NEWS: Report: Currency Fluctuations, Mileage Reimbursement Impact Hyundai, Kia Profits

By Edward A. Sanchez - January 27, 2013
2013 Hyundai Sonata Left Side View
In the course of years or even quarters, the fortunes of an automaker can rise and fall relative to the industry overall. Despite record-setting sales in the U.S. and other markets, Hyundai and Kia profits fell short of analysts' expectations for the fourth quarter of 2012, according to reports from Bloomberg and Reuters. Fourth-quarter profits of $1.8 billion were 5.5 lower than the same period last year. Among the major factors affecting profits are the growing strength of the South Korean Won, which makes exports more expensive.
In addition to the impact of currency trends on company profit, Hyundai and Kia have collectively set aside $412 million as part of a settlement to reimburse owners of certain 2011 and 2012 model vehicles that had over-stated fuel economy claims. As many as 900,000 owners have been offered prepaid fuel cards as part of the settlement. Hyundai's 2012 U.S. sales of 703,007 vehicles showed 8.9 percent growth, resulting in a record sales total for the company. However, industry-wide sales were up 13 percent for the ear.
Even in the battered European market, sales were up 10 percent on the popularity of the i30 compact (sold in the U.S. as the Elantra) and the Tucson SUV. China was another sales bright spot for the company, with sales up a combined 16 percent for the Hyundai and Kia brands.
2013 Hyundai Sonata Left Side View

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