SEOUL (Reuters) -South Korea’s Hyundai Motor (OTC:) expected on Thursday its 2025 sales growth would halve due to softening vehicle demand and rising competition after reporting a 17% drop in fourth-quarter profit.
Hyundai, which together with affiliate Kia is the world’s third-biggest automaker by sales, forecast 2025 revenue would grow 3.0% to 4.0% this year, versus 7.7% a year earlier. It expects its operating margin to be 7.0% to 8.0%, slipping from 8.1% in 2024.
“Business uncertainties are increasing this year,” Hyundai said, citing a slowdown in major markets, slowing demand for electric vehicles and macroeconomic volatility.
Global automakers are bracing for policy uncertainty in the U.S., the world’s second-largest auto market, that threatens to dampen demand, as U.S. President Donald Trump said this week he could impose 25% import tariffs on Canada and Mexico from Feb. 1.
Trump also said he would consider scrapping tax credits for purchases of electric vehicles.
North America and South Korea are the two biggest markets for Hyundai and Kia.
Hyundai reported operating profit of 2.8 trillion won ($1.95 billion) for October-December as it spent more on promotions in a slowing car market
The result was lower than a 3.2 trillion won average of 24 analyst estimates compiled by LSEG SmartEstimate, which is weighted towards estimates from analysts who are more consistently accurate.
Hyundai shares rose 1.4 % after the earnings announcement.
During the quarter, Hyundai’s global retail sales slipped as solid sales in the United States and India were offset by sluggish demand in South Korea, Europe and China.
A weaker local currency against the U.S. dollar helped raise Hyundai’s repatriated earnings but also increased foreign debt and related financial costs, weighing on profit, analysts said.
($1 = 1,436.4200 won)