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Hyundai, Kia Motors show slow sales growth in 2018 on China, US pressure

Analysts said that would be a slight increase on 2017, when the automakers are estimated to have sold about 7.3 million vehicles, their lowest in five years.

Reuters  |  Seoul 

Hyundai Motors, Kia Motors
(Photo: Reuters)

South Korea's and on Tuesday flagged only modest growth in 2018, suggesting a slow recovery from a slump linked to their lack of SUVs in the and diplomatic tensions with

and smaller affiliate Kia, which together make the world's fifth-largest automaker, said demand was expected to soften in the US and Chinese markets as they unveiled a combined target of 7.55 million vehicles this year.

Analysts said that would be a slight increase on 2017, when the automakers are estimated to have sold about 7.3 million vehicles, their lowest in five years.

"The target for and Kia is lower than expected. It seems to be a conservative target, reflecting a slow recovery in and ongoing U.

S difficulties," Kim Jin-woo, an at & Securities said.

The 2017 figures are due out later on Tuesday but analysts expect the South Korean duo to fall well short of their target of 8.25 million vehicles, marking their third consecutive annual miss.

shares declined 2.2 per cent after falling as much as 4.5 per cent on Tuesday morning, and stocks were down more than 1.6 per cent. The broader market rose 0.2 per cent.

The firms' tumbled last year in China, the world's largest auto market, amid a chill between and Seoul over South Korea's deployment of a US anti-missile system.

in and the were also hurt by a failure to capitalise on surging demand for sports utility vehicles (SUVs).

While has plans to offer more SUVs in the and China, analysts said new models such as the redesigned Santa Fe SUV may come too late in the year to significantly impact

The expiration of a tax cut on small-engine cars in also would be a negative for Hyundai's sedan-heavy line-up, they said.

Group Mon-koo said in a statement the South Korean automakers would launch 12 new or refreshed models this year.

They would "actively venture into" new markets like Southeast Asia, as protectionism was expected to grow elsewhere, he added.

and the will hold talks on a trade deal on Jan. 5 although US has threatened to withdraw from the pact.

Chung, 79, skipped his annual New Year speech to employees for a second year in a row. He has not made any public appearances since December, 2016.

First Published: Tue, January 02 2018. 10:48 IST
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