Hyundai Motor Q2 profit jumps 48.4 pct on weak won

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SEOUL, July 23 (Yonhap) -- Hyundai Motor Co., South Korea's largest automaker,
reported a 48.4 percent jump in second-quarter profit as a soft local currency
helped cushion the impact of a downturn in global auto markets.

Hyundai earned 811.8 billion won (US$649.7 million) in the three months ended
June 30, compared with a profit of 546.9 billion won a year earlier, the company
said in a regulatory filing.
The result was far above what analysts had been expecting. The median forecast by
analysts surveyed by Yonhap Infomax, the financial news arm of Yonhap News
Agency, was for 564 billion won.
Coupled with the local currency's weakness against the U.S. dollar, analysts had
expected the growing popularity of smaller and more fuel-efficient cars worldwide
during the economic downturn to contribute to the better-than-expected results.
The won fell some 20 percent against the U.S. dollar in the April-June period,
compared with the same period a year ago. A weaker won makes it easier for
Hyundai to cut prices abroad to attract customers.
Second-quarter operating profit, however, fell 0.8 percent to 657.2 billion won,
hurt by rising marketing costs and falling exports. Sales declined 11.3 percent
to 8.07 trillion won amid the global economic slump.
Looking ahead, Hyundai Motor Chief Financial Officer Chung Tae-hwan said the
company expects to sell 1.6 million vehicles in the second half of this year by
stepping up marketing and cutting prices.
"In the second half, we are targeting a 5.1 percent market share in the U.S.,"
Chung told analysts and reporters after the earnings release. Hyundai claimed to
have held 4.3 percent of the U.S. market in the first half.
In the first six months of this year, Hyundai's vehicle sales fell 6.2 percent to
1.38 million units as the company grappled with the auto industry's worst global
downturn.
But analysts say Hyundai is better positioned to navigate the global economic
slump due to the fact that its line-up is focused on small cars.
Kang Sang-min, an auto analyst at Tong Yang Securities Co., said Hyundai's
vehicle sales may have already hit bottom.
"With demand seen to be recovering in the first quarter, Hyundai is expected to
maintain its sales momentum in coming quarters," Kang said.
On Wednesday, Hyundai and its affiliate Kia Motors Corp. said they would invest
4.1 trillion won by 2013 to develop fuel-efficient cars and cut carbon emissions.

Despite the handsome results, shares of Hyundai Motor, which released earnings
about an hour before the local stock market closed, declined 2.97 percent to
close at 81,700 won.
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