Seoul, Oct 30 (IANS) Hyundai Motor, South Korea’s leading automaker, said on Thursday its third-quarter net profit fell 20.5 per cent from a year earlier, hit by newly imposed US import tariffs that took effect in April.
Net profit for the three months ended in September declined to 2.54 trillion won ($1.8 billion) from 3.2 trillion won in the same period last year, the company said in a regulatory filing.
The company said U.S. tariffs on imported vehicles have continued to weigh on its quarterly earnings since April 2, when the U.S. government began imposing 25 percent tariffs on all imported vehicles, reports Yonhap news agency.
Currently, tariffs on Korean vehicles remain at 25 per cent, far higher than the revised 15 per cent applied to vehicles from Japan and the European Union.
On Wednesday, however, U.S. President Donald Trump agreed to lower the auto tariffs on Korean vehicles to 15 per cent during his summit with South Korean President Lee Jae Myung, as the two sides finalised details of Seoul’s $350 billion investment pledge under a broader tariff deal reached in July.
Hyundai said it expects the lower auto tariffs will help the company compete on a more level playing field with Japanese carmakers and other rivals in the U.S. market.
Operating profit fell 29.1 per cent to 2.53 trillion won in the third quarter from 3.58 trillion won a year earlier, while sales rose 8.8 per cent to 46.72 trillion won from 42.92 trillion won.
“Favourable exchange rates and increased vehicle sales in major markets such as Europe and the United States helped support quarterly revenue,” the company said.
In the fourth quarter, Hyundai plans to increase the share of gasoline hybrid models in its global lineup amid slowing demand for electric vehicles (EVs), while also planning aggressive new model launches next year.
Meanwhile, Hyundai Motor Group welcomed the Seoul-Washington trade deal, which cuts U.S. tariffs on imported cars from 25 per cent to 15 per cent, and vowed to continue efforts to strengthen its competitiveness.
“We express our gratitude to the government for its dedicated efforts throughout the difficult negotiation process that led to this agreement,” the company said in a statement.
—IANS
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