Aided by government incentives that bolstered sales of fuel-efficient vehicles, Hyundai surpassed its earnings expectations and set a record quarterly profit in the third quarter amidst the global recession.
Hyundai tripled its third-quarter earnings this year even as the automotive industry struggled for sales. The South Korean company capitalized on the turmoil by increasing its marketing to gain a larger market share. The strategy worked. The company leapfrogged Ford to become the fourth-largest automaker based on global sales and now looks set to go head-to-head with Volkswagen as the most profitable automaker this year.
“These are amazing earnings,” said Kazutaka Oshima, CEO of Rakuten Investment management in Tokyo. “The figures reflect Hyundai’s increased share in the Chinese and North American markets, and that’s a threat to Japanese automakers.”
According to the Japanese business paper the Nikkei business daily, Honda is the only Japanese auto manufacturer expected to post a profit in the first half of the fiscal year.
Despite tripling last year’s third-quarter profit with a 979.1 billion won ($832 million) profit in this year (last year’s Q3 profit was 264.8 billion won, $225 million), Hyundai says the months ahead may not be quite as profitable. The automaker warned that rising oil prices, higher interest rates, and a stronger won might hurt the company’s earnings in the coming months.