Hyundai Motor's Profit Rises on Higher South Korean Auto Demand

Hyundai Motor Co., South Korea's third-largest exporter, reported its first increase in profit in six quarters after it sold more cars at home.
Net income in the three months ended June 30 rose to 611.5 billion won ($666 million) from 403.1 billion won a year ago, the Seoul-based automaker said in a statement today. That was higher than the 502 billion won median estimate in a Bloomberg survey of 11 analysts. Sales rose to 8.03 trillion won from 7 trillion won.
Hyundai Motor boosted domestic vehicle sales 16 percent in the second quarter as a growing economy helped increase consumer spending. A 38 percent gain this year in South Korea's benchmark Kospi stock index increased investors' wealth and helped fuel demand for the carmaker's Grandeur premium sedans and Veracruz sport-utility vehicles.
``Local auto sales are finally picking up after being sluggish for so long,'' said Choi Se Jin, who helps manage about $11 billion in assets as an analyst at Daehan Investment Trust Management Co. in Seoul. ``The rising stock market typically leads to higher demand for new cars and Hyundai Motor will benefit.''
Hyundai Motor, the maker of Sonata sedans and Santa Fe sport-utility vehicles, sold 161,227 vehicles at home in the second quarter. Exports from domestic plants gained 6.6 percent to 292,038 vehicles. Shipments from its factories in China, India, Turkey and the U.S. increased 4.3 percent to 235,241 during the quarter, according to the company's Web site.
Demand for high-end cars helped raise the average selling price for Hyundai Motor vehicles by 4.6 percent compared with a year earlier, Nam Kyung Moon, an analyst at Meritz Securities Co., estimated in a report on July 16.
South Korean sales of the Grandeur rose 20 percent in the quarter from a year earlier. Hyundai Motor also sold 4,565 Veracruz SUVs, introduced in October, in the period.