Hyundai Motor posts record $8 billion profit in 2022 on EV, SUV demand

Hyundai Motor posts record $8 billion profit in 2022 on EV, SUV demand [Photo by Han Joo-hyung]

Despite the global economic slowdown, Hyundai Motor Co. posted record operating profit of nearly 10 trillion won ($8 billion) last year, driven by strong sales of lucrative electric and sport-utility vehicle models and favorable currency influences.

In a conference call on Thursday, Hyundai Motor said that last year’s total revenue increased 21.2 percent on year to 142.52 trillion won with operating profit up 47.0 percent to 9.82 trillion won. Net profit, excluding minority interest, rose 49 percent to 7.36 trillion won. It sold a total of 3.94 million vehicles.

In the fourth quarter of last year, sales rose 24 percent to 38.5 trillion won and operating profit more than doubled to 3.36 trillion won, which is 8.1 percent higher than the market consensus. The company will offer shareholders 6,000 won per share in dividend payment.

The carmaker’s earnings in the fourth quarter increased from a year ago thanks to an increase in sales volume and higher demand for higher-value added models such as Ioniq 6 electric cars, Genesis brands and sport-utility vehicles.

Car production is increasing along with improvement in chip supply shortages, but standby demand is expected to remain solid because inventory levels in major markets are still low, said a company official, adding there are concerns about a decline in demand due to market uncertainties stemming from geopolitical risks and interest rate hikes.

For this year, the carmaker plans to invest 10.5 trillion won, including 5.6 trillion won in capex, and aims to sell 4.32 million vehicles globally. Sales are projected to grow between 10.5 percent and 11.5 percent this year and targets an operating profit margin of 6.5 percent to 7.5 percent. The company plans to sell its revamped Kona EVs and Santa Fe SUVs this year to help it increase market share and profitability.

Hyundai Motor will also retire its treasury shares equivalent to 1 percent of the outstanding shares to boost shareholder value and confidence in the company.