Kiwoom Securities announced on October 12 that it has lowered its target price for Hyundai Motor from 700,000 won to 600,000 won, reflecting production disruptions and weak sales due to domestic factory strikes. However, the firm maintained a positive outlook on the automotive sector, particularly regarding the potential for increased demand for hybrid electric vehicles (HEVs).
Shin Yoon-cheol, a researcher at Kiwoom Securities, stated, "We expect third-quarter consolidated revenue to be 43.8 trillion won and operating profit to be 2.41 trillion won, falling short of market expectations. Global wholesale sales are projected to decline by 11.5% year-on-year to 919,000 units, while domestic sales are expected to drop by 27.2%."
He attributed the disappointing sales figures in major regions during the third quarter primarily to strikes at the Asan and Ulsan plants that occurred from July to August. The situation was exacerbated by production halts due to the replacement of aging equipment at the Asan plant.
Despite the lowered target price, the potential for increased sales of new hybrid models is viewed positively. Shin noted, "As consumer sentiment weakens due to rising market interest rates, demand is likely to concentrate on HEVs, especially in the fourth quarter. With the depletion of electric vehicle subsidies in key regions by year-end, we anticipate a stronger focus on HEV demand."
He added, "We expect a robust volume cycle for the new hybrid models of the Tucson, Avante, and GV80. If the existing annual guidance for 2026 is maintained based on these new models, we can expect new foreign investments to flow in."
* This article has been translated by AI.
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