Korea's Hyundai Motor October 2003 Sales Jump

SEOUL, Nov 3, 2003; Kim Kyoung-wha writing for Reuters reported that South Korea's biggest auto maker, Hyundai Motor Co, posted a nine percent rise in October sales on Monday, aided by soaring exports to the United States and Europe but weighed down by stagnant domestic demand.

Hyundai affiliate Kia Motors Corp and smaller rivals had similar results, as tighter consumer lending hit local sales, but improving global economic conditions boosted offshore demand.

Overall, five auto makers posted a 22 percent rise in sales in October to 406,736 vehicles compared with 333,164 a year ago.

Analysts said slower domestic sales would continue in the months ahead as surging consumer defaults and tougher financing delayed a long-awaited revival in consumer spending.

Kim Hag-ju, an auto analyst at Samsung Securities, said he did not expect domestic consumption to recover any time soon, but was upbeat on foreign sales.

"Declining inventories at overseas plants mean there would be more shipments in the coming months," Kim said.

Hyundai, 10 percent owned by U.S.-German auto maker DaimlerChrysler AG, said its sales in October rose to 198,122 vehicles from revised a 181,847 a year earlier.

"We had record monthly sales as a brightening world economic outlook bolstered overseas sales," said Hyundai spokesman Jake Jang.

"Key markets such as the United States, Europe and China enjoyed good sales."

Hyundai, which produces the Elantra compact and Sonata mid-sized sedan, exported 146,363 vehicles in October, up 28 percent from revised 114,179 units a year ago.

Buoyant shipments of automobiles powered South Korean exports for October, helping to stoke expectations that Asia's fourth-largest economy may be on the mend. The South Korean economy tipped into its first recession in five years in the first half on sluggish consumption.

Hyundai shares rose 2.4 percent to end at 40,400 won and Kia shares jumped five percent to 8,710, outshining the wider market's 1.23 percent rise.

SMALLER RIVALS

Kia, the country's second-largest auto maker, which makes the Sorento sport utility vehicle, said October sales rose 6.5 percent from a year earlier to 108,221 vehicles against 101,571.

Kia said exports during October jumped 28 percent to 81,421 vehicles from 63,492 a year ago. It said a better brand image in the North American markets bolstered demand for its new large model Opirus.

GM Daewoo Automotive and Technology, South Korea's third-largest auto maker, said October exports rose to 70,275 vehicles to take total sales to 80,313 from 21,998 a year earlier.

General Motors Corp, the world's largest auto maker, and partners took a majority stake in some of the assets of Daewoo Motor last year, creating the unlisted GM Daewoo. The former Daewoo Motor Co halted U.S. exports in 2001 due to financial stress.

The South Korean unit of French auto maker Renault SA posted a 36 percent fall in October sales to 8,007 units on falling domestic sales.

Sport untility vehicle maker Ssangyong Motor Co said its October sales fell 21 percent to 12,073 vehicles compared to 15,292 a year earlier. Ssangyong, which makes the Rexton and Korando SUVs, sells most of its vehicles at home.