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Sales increased by 5.3% to 29.5019 trillion won... Q1 record high driven by high-profit vehicle sales
Only major automaker to see sales increase... Eco-friendly vehicle sales proportion 29.7%
Kia's operating profit decreased by over 20% in the first quarter of this year compared to the same period last year, due to the impact of US tariffs and the Middle East war.
Instead, Kia increased sales and market share at a time when most major automakers saw sales decline due to sluggish global demand.
Kia announced in its Q1 earnings conference call held on the 24th that its consolidated operating profit for the first quarter of this year was tentatively tallied at 2.2051 trillion won, a 26.7% decrease compared to the same period last year.
Sales increased by 5.3% year-on-year to 29.5019 trillion won, marking the highest quarterly sales ever.
Net profit decreased by 23.5% to 1.8302 trillion won. The operating profit margin was 7.5%.
Kia explained that its profitability was hit by the full reflection of the impact of US tariffs on imported finished vehicles in the first quarter of this year. The US tariff cost compiled by Kia was 755 billion won.
In addition, increased incentives due to intensified competition in the North American and European markets, and an increase in sales warranty provisions due to a sharp rise in the year-end exchange rate also negatively affected operating profit. As a result, the selling, general and administrative expenses ratio rose by 1.2 percentage points (p) to 12.2% compared to the same period last year.
However, Kia added that sales reached a quarterly record high due to improved product mix focused on high-profit models and favorable exchange rates.
Global sales (wholesale basis) totaled 779,741 units, a 0.9% increase compared to the same period last year. This includes 141,513 units domestically and 638,228 units overseas.
Considering that most major global automakers, including Hyundai Motor, experienced decreased sales, the general assessment in the automotive industry is that Kia's performance was strong.
In the domestic market (retail basis), sales increased by 5.2%, driven by electric vehicles such as EV3, EV5, and PV5, following the implementation of new year EV subsidies.
Overseas market sales increased by 3.7%, recovering from supply disruptions due to the Strait of Hormuz blockade by shifting sales to other regions and supplying new hybrid models like the Telluride in North America.
As a result, global market share rose by 0.5 percentage points (p) to 4.1% compared to the same period last year. This quarter marks the first time Kia's global market share exceeded 4%.
In the first quarter of this year, Kia's eco-friendly vehicle sales totaled 232,000 units, a 33.1% increase compared to the same period last year.
By type, hybrid vehicles increased by 32.1% to 138,000 units, and electric vehicles increased by 54.1% to 86,000 units.
Consequently, the proportion of eco-friendly vehicles in total sales increased by 6.6 percentage points to 29.7%, up from 23.1% in the same period last year.
The proportion of eco-friendly vehicles in major markets was: ▲ Domestic 59.3% (up 16.6%p) ▲ U.S. 23.0% (up 4.6%p) ▲ Western Europe 52.4% (up 8.5%p).
Kia anticipates that an uncertain business environment, including geopolitical risks, intensified competition, and changes in external conditions, will continue this year.
In response, the company plans to focus on fundamentally defending profitability by improving product mix and ASP (Average Selling Price).
In the Korean market, Kia will strengthen its eco-friendly vehicle-centric sales strategy, including expanding EV4, EV5, PV5, and launching the Seltos Hybrid.
In the U.S. market, the company plans to increase sales of high-profit models like the Telluride and Carnival and strengthen its hybrid lineup to enhance market dominance.
In the European market, Kia plans to solidify its EV leadership by building a full EV lineup, including EV2, EV3, EV4, and EV5.
A Kia official stated, "Although short-term cost increase factors such as US tariffs have emerged, global market share expansion and qualitative growth centered on eco-friendly vehicles are continuing." He added, "We will maintain profitability through improving the sales mix focused on high-value vehicles and efforts to reduce costs."
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