Hyundai Motor Co.’s deliveries in China, the world’s largest auto market, have gone down 8.5 percent after the first six months of the year, the South Korean company being the latest global carmaker to report lagging demand in the region.
The carmaker, the world’s fifth largest when considered with affiliate Kia Motors, delivered a total of 513,784 units in China during the first half of the year, and excluding imports, sales last registered a drop during the final six months of 2007, when the company had a massive fall of 24 percent. “Hyundai didn’t have enough SUVs and seems to have been slow in increasing incentives in China,” commented Lee Sang Hyun, an analyst at IBK Securities Co. “You can say that the company’s share performance this year hinges on how well Hyundai recovers sales in China in the coming months.” Hyundai is going to deliver the overall second quarter financial results this Thursday, which could be impacted by the drop in demand in China throughout the first half of the year.
Hyundai joins other automakers, such as Germany’s Volkswagen – also counting China as its largest market by volume – in posting negative results in the market that just a few years back was growing steady at double-digit percentage levels. The South Korean automaker has also been impacted by its mostly sedan-prone lineup of models and the strong currency at home – with Chinese consumers still snapping more sport utility vehicles than models in other segments. The company responded lately by lowering production and cutting costs.