Citing summer strikes and weak domestic demand, Hyundai announced that it has cut its 2006 sales projections by up to 6% for Hyundai and Kia. This despite the fact that September sales were up 23% compared to August figures. Hyundai vice chairman and CEO Kim Dong-jin said that he expects 2007 sales to rebound, but didn't provide additional information. Kim explained that the group slightly changed its business plan when they experienced strikes during the summer: "Late last year, we set our 2006 production target at 4.1 million. However, we reduced our production or sales volume down to 3.85 million because of labor disputes."
Analysts have said they expect Hyundai to achieve higher sales thanks to lower oil prices next year, despite weak domestic demand during the economic slowdown in Asia's third-largest economy, and because of consumers' possible negative reaction to North Korea's nuclear tests. "In 2007, sales are expected to be slightly higher than this year, but I don't see a sharp turnaround as the global economy may deteriorate," said CJ Investment auto analyst, Choi Dae-sik.
In related news, fellow Korean automaker GM Daewoo said it expected growth to slow from 38 percent so far this year, to 12.5 percent next year, as the impact of new product launches wears off.
[Source: Reuters]
Source: AutoBlog
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