Hyundai and its affiliate Kia Corp., together among the world’s top 10 automakers by sales, have forecast a 12.1 percent jump in their combined global sales for 2022, after their sales fell almost 4 percent short of a target of 6.92 million vehicles last year due to the chip shortages.
Hyundai posted a nearly 50 percent drop in its profit for the quarter ended December, significantly short of analysts’ estimate, mainly due to the payment of corporate taxes.
It reported a net profit of 547 billion won ($456 million), versus 1.1 trillion won a year earlier. That compared with an average analyst forecast of 1.5 trillion won compiled by Refinitiv SmartEstimate.
Higher prices, Omicron
Analysts warn that soaring raw material prices, component shortages and logistical bottlenecks caused by the pandemic are likely to further drive up costs in the current quarter.
“It is still difficult to forecast how the chip shortage will pan out … also there will be other uncertainties involving the spread of the Omicron variant and potential issues related to Ukraine tensions,” said Lee Jae-il, an analyst at Eugene Investment & Securities.
Japanese automakers Toyota Motor Corp. and Honda Motor Co. have said they plan to curb their production this month due to rising COVID cases and part supply issues.
As supply chain and distribution disruptions continue, delaying deliveries and production, analysts expect Hyundai to raise vehicle prices to mitigate the impact.
Major automakers and dealers, such as Tesla Inc. and Honda, have already raised car prices over the past year.
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