Double-Digit Sales Decline in Module and Core Parts Business
"Impact of Electric Vehicle Volume Reduction... Aggressive Sales in Second Half"
Due to reduced production by automakers and the electric vehicle chasm (temporary demand stagnation), Hyundai Mobis's performance in the second quarter of this year showed some slowdown.
On the 26th, Hyundai Mobis announced that it recorded sales of 14.6553 trillion KRW and an operating profit of 636.1 billion KRW in the second quarter of this year. These figures represent decreases of 6.6% and 4.2%, respectively, compared to the same period last year. Net profit for the period increased by 7.0% to 997.7 billion KRW.
The decline in production by automaker clients supplying electrification parts and the stagnation trend in the eco-friendly vehicle market due to the electric vehicle chasm are interpreted as factors affecting the performance.
By business division, sales in the module and core parts business recorded 11.6909 trillion KRW, down 10% compared to the same period last year. On the other hand, sales in the after-sales service (A/S) business division increased by 9.9% to 2.9644 trillion KRW during the same period. The module and core parts business reflected the global automotive industry trends such as the decrease in electric vehicle volumes, while the A/S business saw sustained global demand.
A Hyundai Mobis official stated, "Although the fixed cost burden has temporarily increased due to the decrease in electric vehicle volumes, sales in the manufacturing sector of high value-added parts such as electronic components are showing remarkable growth." He added, "We will strategically secure future growth engines and respond to market conditions by expanding the supply mix of eco-friendly vehicle parts and increasing the supply of high value-added core parts, including increasing parts supply for hybrid vehicles."
Meanwhile, Hyundai Mobis achieved order intake of approximately 2.32 billion USD from global customers in the first half of this year. This accounts for 25% of the annual order target of 9.34 billion USD. Despite some delays in electrification projects due to the electric vehicle chasm, the company secured additional orders for key vehicle components such as infotainment and lamps from automakers in the North American and Asian markets. With major order plans concentrated in the second half of the year, aggressive sales activities will be carried out to achieve the annual target. Since the proportion of electronic parts in core parts sales has exceeded half since last year, the company plans to increase orders focusing on high value-added electronic parts.
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