Hyundai Motor Group's Genesis luxury-brand GV80 SUV / Courtesy of Hyundai Motor Group

By Baek Byung-yeul

Chung Euisun, chairman of Hyundai Motor Group

Hyundai Motor displayed better-than-expected performance in the first quarter of this year, on the back of increased sales of high-priced cars such as its luxury brand Genesis models and SUVs, despite production disruptions caused by supply chain instability, the carmaker said Monday.

The company said its first-quarter operating profit hit 1.92 trillion won ($1.53 billion), rising by 16.4 percent compared to the same period last year. Its sales also increased by 10.6 percent to 30.29 trillion won from a year ago.

"Although the number of car sales fell year-on-year in the first quarter due to a lack of production caused by a global supply shortage of semiconductors and other parts, operating profit increased year-on-year thanks to improved sales mix centered on Genesis cars and SUVs," a company spokesman said.

Hyundai sold 902,945 vehicles in the global market during the January-March period, down 9.7 percent compared to the same period in 2021. In Korea, the company sold 152,098 cars, an 18 percent decrease year-on-year, while 750,847 cars were sold overseas, down 7.8 percent year-on-year.

However, sales of high-priced vehicles such as Genesis and SUVs buoyed the performance of the company and favorable currency exchange rates helped boost the results. The company said its average won-dollar exchange rate in the first quarter rose 8.2 percent year-on-year to 1,205 won.

Regarding the company's performance in the following quarters, the company predicted the business environment will remain difficult due to growing uncertainties such as an imbalance in parts supply caused by COVID-19 lockdowns in China and soaring raw material prices because of geopolitical conflicts.

"It is difficult to predict the environment because of the possibility of a prolonged Russian invasion of Ukraine," Seo Gang-hyun, executive vice president in charge of the company's finance and accounting division, told investors during a conference call. "We have established various plans to respond quickly to the rapidly changing business situation."

Kia, a sister brand of Hyundai Motor, also announced its operating profit in the first quarter increased 49.2 percent year-on-year to 1.6 trillion won.

The automotive group is also working on improving its climate change response. The group said four of its key affiliates ― Hyundai Motor, Kia, Hyundai Mobis and Hyundai Wia ― joined RE100, a global initiative committed to moving toward 100 percent renewable energy.

"While all four companies aim to transition to 100 percent renewable energy by 2050, each will make independent efforts to achieve targets ahead of schedule, by as early as 2040, depending on energy supply-and-demand conditions at their respective overseas operations," the automotive group said.