Hyundai reports a 39% year over year decline in May sales due to COVID-19 restrictions

Hyundai reports a 39% year over year decline in May sales due to COVID-19 restrictions
  • Hyundai reports a 39% year over year decline in May sales due to COVID-19 restrictions.
  • Sales were up 30% in May as compared to April when Hyundai sold 167,693 vehicles.
  • Kia Motors also posts a 33% decline in provisional May sales to 160,913 vehicles globally.

Hyundai Motor (KRX: 005380) revealed on Monday that its provisional sales in May came in 39% lower as compared to the same month last year. The company sold a total of 217,519 vehicles globally in May.

Hyundai attributed the slump in its global sales to the Coronavirus pandemic that weighed on demand and pushed the company into temporarily closing its production factories in recent months to minimise the fast spread of the flu-like virus. Before the outbreak, Hyundai posted its best quarterly performance since 2017 in January.

Hyundai posted an over 2% intraday gain on Monday. At £65.74 per share, the automaker is roughly a little under 15% down year to date in the stock market. Learn more about why prices rise and fall in the stock market.

Hyundai’s sales climb by 30% on a monthly basis

On a monthly basis, however, the South Korean auto manufacturer’s sales were roughly 30% up in May as compared to April when it had sold an even lower 167,693 vehicles. The monthly increase, as per the company, hinted at early signs of recovery as COVID-19 starts to subside, paving the way for businesses to resume operations.  

The carmaker also reported a 5% increase in its domestic sales in May as compared to the comparable month of 2019. This increase, according to Hyundai, was attributed to its new models, including the Genesis G80 sedan and an all-new Elantra. Its world-renowned Grandeur sedan remained a prominent sales driver for the automaker in May.

Hyundai’s overseas sales, on the other hand, tanked 50% on a year over year basis as the ongoing health crisis wiped global demand for automobiles.

South Korea’s auto exports decline by 54% in May

South Korea’s trade ministry also announced separately on Monday that the country saw an unparalleled 54% year over year decline in auto exports in May. The ministry specifically attributed the decline to lower demand in Hyundai’s key markets like Europe and the United States.

Hyundai’s subsidiary, Kia Motors (KRX: 000270), also posted a 33% decline in provisional May sales as compared to last year. Kia sold 160,913 vehicles globally in May. On a domestic level, its sales were up by 19% that partially offset a massive 44% decline in overseas sales in May. Together, Hyundai and Kia make up the world’s 5th largest car manufacturer.  

Hyundai’s also remained flat on average in the stock market last year. At the time of writing, it is valued at £17 billion and has a price to earnings ratio of 10.04.

By Wajeeh Khan
Mr. Khan specialises in Public Health by academia but is a trader by passion. Taking up two new hobbies of writing and trading in his teen years, he is now a professional trader and news writer with over 5 years of experience in various financial markets. Khan is passionate about bringing insightful articles to his readers and hopes to add value to their portfolios.
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