[Concall Summary] Hyundai Motor "Semiconductor Supply Shortage Continues in Q4... Doing Our Best to Defend Profitability"

Possibility Mentioned That 2025 Electric Vehicle Sales Could Exceed 560,000 Units

[Asia Economy Reporter Ki-min Lee] Hyundai Motor Company plans to explore various methods to prevent a decline in profitability in the fourth quarter despite the semiconductor supply shortage. Hyundai also mentioned the possibility that its electric vehicle sales in 2025 could exceed the sales target of 560,000 units.

Seo Kang-hyun, Vice President and Head of Hyundai Motor’s Planning and Finance Division, said at the third-quarter earnings conference call held on the 26th, "Although the spread of COVID-19 in the Southeast Asia region has slowed down after September, it is expected that additional time will be needed for semiconductor manufacturers to normalize their production lines. We are making efforts to minimize the impact of weakened profitability through discussions on semiconductor supply stabilization measures, production and sales optimization, and mix adjustments."

He added, "Going forward, we will devote company-wide capabilities to stabilize semiconductor supply by developing alternative components, placing early annual volume orders, and operating regular consultative bodies with suppliers to build friendly relationships."

However, Hyundai stated, "Due to an increase in production days compared to the previous quarter and some improvement in semiconductor supply, we plan to increase wholesale sales in the fourth quarter by approximately 15-20% compared to the third quarter."

Hyundai also hinted at the possibility that electric vehicle sales could increase beyond the original target. Koo Ja-yong, Executive Director in charge of IR at Hyundai Motor, said, "When we announced our future technology strategy in 2019, we shared an electric vehicle sales target of 560,000 units for 2025. However, considering the rapidly changing electric vehicle market recently, Hyundai recognizes that this target is somewhat conservative."

Although he did not mention a direct forecast of sales volume, he expressed optimism, saying, "Cumulative electric vehicle sales in the third quarter reached 99,403 units, a 40% increase compared to last year. The Ioniq 5 began full-scale sales in Europe from the third quarter, surpassing 30,000 units cumulatively. Next year, we expect continued expansion of electric vehicle sales with the full-scale launch of the Ioniq 6 and Genesis GV60."

In particular, Hyundai is considering local production to accelerate its entry into the U.S. electric vehicle market. Yoon Tae-sik, Hyundai Motor’s IR team leader, said, "The U.S. is showing strong commitment to electrification by raising the electric vehicle ratio from the current 30% to 50% by 2030. We are also reviewing the U.S. electric vehicle market from various angles, and will announce plans for local production once they are finalized."

Hyundai expects continuous growth for its luxury brand Genesis and reiterated plans to launch eco-friendly vehicles for carbon neutrality. Executive Director Koo explained, "Genesis’s cumulative sales in the third quarter reached 244,000 units, with its sales share rising to 4.6%. We expect sales to increase further in the fourth quarter with new model launches such as the GV60 and G90." He added, "Although the sales target for next year has not been finalized, it is expected to increase by more than 10% compared to this year. Especially, growth is anticipated as sales begin in earnest in Europe and China."

He also said, "Genesis plans to release only electrified models from 2025 and to sell only electric and hydrogen models from 2030. By 2030, we aim to complete a lineup of eight electric and hydrogen vehicles and target annual sales of 400,000 units." He further explained, "Genesis’s electrification strategy is not merely about expanding sales of electrified vehicles but aims to achieve carbon neutrality across the entire Genesis value chain by 2035."

Meanwhile, Hyundai reported consolidated third-quarter sales of 28.8672 trillion KRW, operating profit of 1.6067 trillion KRW, net profit of 1.4869 trillion KRW, and sales volume of 898,906 units on the day.

This content was produced with the assistance of AI translation services.