Hyundai only anticipates seeing a modest recovery in demand and sales of vehicles in China and elsewhere this year.
Speaking during a recent earnings call and reported by Reuters, Hyundai chief financial officer Kim Sang-hyun forecasted a bleak year for the auto industry.
“Demand is expected to worsen in the second quarter due to the prolonged suspension of dealer operations and factory operations in overseas markets,” he said. “Global automakers are expected to see their profitability decline in earnest.”
The South Korean automaker says global auto demand dropped by 24 per cent in the first quarter and by more than 40 per cent in March. Hyundai was hit particularly hard in China with sales falling by 43 per cent. Sales in South Korea and the United States decreased by 14 per cent and 11 per cent respectively for the brand.
Read Also: Hyundai Cars Shipped To The U.S. Sitting At Ports Over Lack Of Demand
Hyundai has idled production at plants in the United States, Brazil and India but has resumed production at factories in China, South Korea, Russia, Czech Republic, and Turkey.
The head of Hyundai’s investor relations, Koo Za-yong, said that recovery in China will only be modest due to the economic fallout from the coronavirus pandemic.
“Although we forecast a sales recovery in the second half, annual demand is expected to drop sharply,” he said.
It’s not all bad news. Thanks to a cheaper South Korean won and better sales of higher-end models, Hyundai’s revenue has climbed by 6 per cent to 25 trillion won ($20.4 billion).