Seoul: Hyundai Motor Co., South Korea’s leading automaker, reported a significant 20.5 percent decline in its third-quarter net profit, attributing the drop to the newly imposed U.S. import tariffs that took effect earlier this year. The company’s net profit from July to September decreased to 2.54 trillion won (US$1.8 billion), compared to 3.2 trillion won during the same period last year, as detailed in a regulatory filing.
According to Yonhap News Agency, the imposition of 25 percent tariffs on all imported vehicles by the U.S. government since April 2 has been a substantial factor affecting Hyundai’s quarterly earnings. The tariffs on Korean vehicles have persisted at this rate, contrasting with the revised 15 percent tariffs applied to vehicles from Japan and the European Union.
On a positive note, Hyundai’s prospects in the U.S. market may improve following an agreement reached on Wednesday. U.S. President Donald Trump consented to lower the tariffs on Korean vehicles to 15 percent during a summit with South Korean President Lee Jae Myung. This agreement is part of a broader tariff deal finalized in July, which includes Seoul’s $350 billion investment pledge. Hyundai anticipates that the reduced tariffs will enable it to compete more effectively with Japanese carmakers and other competitors in the U.S. market.
The company’s operating profit also saw a substantial decrease, falling 29.1 percent to 2.53 trillion won from 3.58 trillion won a year earlier. In contrast, sales experienced a growth of 8.8 percent, rising to 46.72 trillion won from 42.92 trillion won. Hyundai attributed the increase in revenue to favorable exchange rates and a surge in vehicle sales in key markets such as Europe and the United States.
Looking ahead, Hyundai intends to boost the share of gasoline hybrid models in its global lineup during the fourth quarter, amid a slowdown in demand for electric vehicles (EVs). The company is also planning an aggressive rollout of new models next year, aiming to capitalize on the evolving automotive market dynamics.