Business

Hyundai Motor Q1 profit nearly triples, in line with expectations

SEOUL (Reuters) – South Korea’s Hyundai Motor Co reported on Thursday a 187% rise in first-quarter net profit on demand for high-margin sports-utility vehicles and its premium Genesis cars, but a chip shortage threatens to derail its growth momentum.

Hyundai, which together with affiliate Kia Corp is among the world’s top 10 automakers by sales, reported a net profit of 1.3 trillion won ($1.16 billion) for the January-March period versus 463 billion a year earlier.

That compared with the 1.3 trillion won forecast of analysts in the Refinitiv SmartEstimate.

Revenue rose 8.% to 27.4 trillion won.

Demand for Hyundai’s pricier cars such as SUVs and the luxury Genesis model stood out in the first quarter.

While major automaking rivals including Volkswagen and General Motors were forced to cut production due to the global shortage of semiconductors, Hyundai managed to stave off that in the first quarter thanks to its healthy chip inventory.

But the South Korean automaker too has begun to run out of semiconductors now, prompting it to temporarily pause production three times and save chips for its most popular models.

(Reporting by Heekyong Yang and Joyce Lee; Editing by Muralikumar Anantharaman)

Read the original article on Business Insider

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