Electric Vehicles and Premium Tires Boost... Hankook Tire's 1Q Operating Profit Doubles Year-on-Year

Operating Profit 400 Billion Won... 109% Increase YoY

Hankook Tire's operating profit for the first quarter of this year nearly reached 400 billion KRW, doubling compared to the same period last year. This is believed to be due to increased sales of high value-added tires, such as tires dedicated to electric vehicles.

Hankook Tire & Technology announced on the 30th that it recorded sales of 2.1272 trillion KRW and an operating profit of 398.7 billion KRW in the first quarter of this year. Compared to the same period last year, sales increased by 1.1% and operating profit increased by 108.8%.

Hankook Tire explained, "Despite economic downturns such as the worsening Middle East situation, the results of proactive research and development (R&D) investments, leading the electric vehicle dedicated tire market, and expanding the proportion of high value-added product sales based on high-performance vehicle and global premium brand strategies were effective." They added, "In addition, raw material prices such as synthetic rubber and carbon black, as well as maritime freight costs, remained at favorable levels, which also contributed."

Hankook Tire was the first in the world to launch the electric vehicle dedicated tire brand 'iON' and has steadily expanded its product lineup, currently selling 202 specifications ranging from 16 inches to 22 inches. Last month, it also received excellent evaluations in comparative tests conducted by the global testing and certification organization T?V S?D.

Hankook Tire plans to raise the supply ratio of electric vehicle tires to new car tires for passenger cars and light trucks (PCLT) to about 25% this year. Currently, it supplies new car tires for Porsche 'Taycan', Audi 'e-tron GT', 'Q4 e-tron', BMW 'i4', Volkswagen 'ID.4', Hyundai 'Ioniq 6', Tesla 'Model Y', and 'Model 3'.

The proportion of high-inch passenger car tires of 18 inches or more in sales of passenger car and light truck tires was 46.8%, up 3.3 percentage points (p) compared to the same period last year. The highest proportion of high-inch passenger car tire sales was in China at 62.5%, followed by Korea at 56.5%, North America at 56.4%, and Europe at 37.4%.

Meanwhile, operating profit at Korean factories (Daejeon and Geumsan plants) in the first quarter improved slightly due to stabilization of labor-management relations. However, the Daejeon plant, where a major fire occurred last year, still requires profitability improvement.