Thursday, January 08, 2015

Hyundai, Global Production at Record High




Hyundai Motor and Kia Motors' combined global production is expected to hit a record high in December, analysts said.

Lee Myung-hoon, an analyst at HMC Investment & Securities, said Monday that Hyundai and Kia Motors' global productions have grown 18.6 and 15.6 percent year on year, to record the largest monthly output ever.

"The local factories are running to the maximum capacity. Following those companies' annual wage talks ended, weekend extra working hours have expanded," Lee said.

"Chinese factories, whose production capacity has risen at the beginning of this year, are also revving up the production since Hyundai's ix25 compact SUVs and Kia's K4 sedans continue to enjoy sales hikes following their launches," he added.

The ix25 was launched in October and K3 in September in China.

Lee said that companies' accumulated annual production will hit 8.1 million this year, up 5.8 percent.

The number will reach 8.3 million units next year, a 3.7 percent increase year-on-year, according to the analyst.

"In 2016, when Kia's Mexico plant starts running, their global production will make a conspicuous jump again," he said.

He also said the company will post stronger performance in the fourth quarter and next year, as the won's fall against the dollar will positively affect the company's profits.

The won's weakness makes the company's exports cheaper in overseas markets compared to its rivals.

Hyundai's price-to-earnings ratio in 2015 has been estimated at 5.6, while that of Kia has been forecast at 5.8.

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