Hyundai Motor Co. and its affiliate Kia Motors Corp. are likely to see their combined sales exceed 7 million units next year on the back of improved brand images, production quality and increased capacity, analysts said Sunday.
For this year, South Korea’s top duo of carmakers expect to sell a combined 6.5 million units with Hyundai Motor posting sales of 4 million units.
But they warned last week that they may face increased competition with foreign rivals and unfavorable business conditions down the road.
“Their product quality and brand awareness improved sharply, which will help them weather the global economic slump,” said Seo Sung-moon, an analyst at Korea Investment & Securities. “They may sell up to 7.2 million units next year.”
Last week, Hyundai Motor, the country’s largest automaker, reported a 20.7 percent on-year rise in its third-quarter earnings to 1.91 trillion won on strong overseas sales.
Kia Motors, the nation’s No. 2 automaker, said its third-quarter earnings declined 8 percent from a year earlier due mainly to a loss from equity ties with its affiliates.
Analysts said overseas sales by the two carmakers would also get a boost from free trade deals with the European Union and the United States. (Yonhap News)
The free trade deal with the EU took effect on July 1 of this year, and a similar deal with the U.S. is now pending at South Korea’s parliament, after getting approval from the U.S. Congress early this month.
Kim Byung-kuk, an analyst at Daishin Securities, said production capacity by the two automakers will increase 200,000 units next year, which will help them increase sales in overseas markets. (Yonhap News)