Hyundai hit by first quarterly losses since 2011 as China market fails to drive sales

South Korean car maker Hyundai suffered its first quarterly loss since 2011 in the final three months of last year.

The firm’s sales slumped in China, its biggest market, where car sales contracted for the first time in more than 20 years in 2018 as the effects of trade tariffs and the phasing out of tax cuts on smaller vehicles hampered the sector.

Hyundai reported losses of 129.8bn won (£88m) for the quarter ending 31 December, while operating profit fell 25 per cent to 501bn won.

Despite sales climbing five per cent to 25.67 trillion won in the quarter, the year-end figure was the firm’s sixth consecutive annual fall in profit.

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The company is struggling with overcapacity as well as weakness in its China market, missing its target for sales in the country and reaching only half of its production capacity over the course of the year.

Hyundai’s shares closed 0.8 per cent up on Thursday after initially plummeting 3.5 per cent after the announcement.

Sales in China fell 23 per cent in the quarter, selling only 790,000 against its target of 900,000, only just above its six-year low of 785,000 in 2017, the year Korea’s diplomatic row with Beijing hampered business via poor consumer sentiment. Hyundai’s total capacity for Chinese vehicles is 1.65m annually.