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SEOUL — Hyundai Motor said its first-quarter net profit slumped to its lowest quarterly level in a decade, as the coronavirus hit demand in China and losses at its financial business cut earnings.
Net profit fell 42 percent to 552.7 billion won ($448.7 million), the automaker said in a statement on Thursday.
As the coronavirus pandemic prompted governments to order lockdowns and other social distancing measures, consumer demand began tumbling in January — first in China, then in South Korea and from March in Europe and the U.S.
Hyundai said first-quarter operating profit rose 5 percent to 864 billion won ($701 million) on a one-time gain related to its autonomous driving joint venture, along with a favorable currency environment and enhanced product mix as revenue climbed 6 percent.
Revenue was helped by a stronger product mix with higher sales of crossovers and Genesis luxury models. A weaker Korean won against the U.S. dollar offset the decline in global sales volume, Hyundai said.
Tracking the spread of the outbreak, declines for Hyundai’s first-quarter retail vehicle sales were sharpest in China where they slumped 43 percent. In South Korea, they dropped 14 percent while in the United States, they fell 11 percent.
Global vehicle wholesale volume fell 12 percent to 903,371 units.
Hyundai said in the statement it expects to face weakening profitability in the second quarter due to the pandemic.
“Demand is expected to worsen in the second quarter due to the prolonged suspension of dealer operations and factory operations in overseas markets,” Hyundai CFO Kim Sang-hyun said in an earnings call.
With the outlook for many countries’ recoveries from the pandemic unclear, Hyundai has suspended production at three of its eight plants globally.