Kia Motors Corporation today announced its business results for the third quarter of 2020. Third-quarter revenue increased 8.2 percent, year-on-year, to KRW 16.32 trillion (from KRW 15.09 trillion).
Kia sold 699,402 vehicles around the globe in the July-September 2020 period, slightly lower than 702,258 units sold in the same period last year – -0.40 percent year on year.
Sales outside of Korea declined by just 1.3 percent to 562,678 units as lockdown measures eased in advanced markets, with reviving demand despite the ongoing adverse impacts from COVID-19. Sales in Korea rose by 3.2 percent to 136,724 units, led by sales of the newly launched Carnival minivan, as well as the Sorento SUV and K5 sedan.
Kia recorded revenues of KRW 16.32 trillion in the third quarter, 8.2 percent higher than KRW 15.09 trillion over the same period in 2019. An enhanced product mix helped mitigate the impacts of the unfavorable economic environment, including currency exchange rate movements. Higher sales in China and India also contributed to revenue growth.
The company recorded operating profits of KRW 195.3 billion, down 33 percent from a year earlier, and net profits of KRW 133.7 billion, down 59 percent, after making provisions for quality issues. The company has taken preemptive measures to ensure customer safety and to avoid future cost increases. Excluding provisions, the company’s business performance exceeded market expectations, despite the persistently weak global demand caused by the effects of COVID-19.
For the first nine months of 2020, Kia’s global sales totalled 1,864,137 units, down 10.3 percent from a year earlier, while revenue rose 0.5 percent to KRW 42.26 trillion. Year-to-date operating profit stood at KRW 784.9 billion and net profit was KRW 526 billion.
To combat the adverse business environment stemming from the pandemic, the company says it plans to guard profitability and competitiveness with new models, while optimising production capacity to best cope with the recovery in market demand.
Despite the tough business environment, Kia will continue to focus on realizing its ‘Plan S’ strategy. Under Plan S, the company aims to proactively introduce 11 battery electric vehicles and increase its operating profit margin to 6 percent by 2025.