SEOUL, South Korea (AP) — Hyundai Motor Co. reported Thursday its lowest quarterly earnings in more than five years after underestimating strong demand for SUVs and losing ground to local brands in China.
South Korea's largest automaker said its third quarter net income was 1.2 trillion won ($1.1 billion) for July-September quarter, slumping more than 25 percent over a year earlier.
The result, its worst since the first quarter of 2010, was below even the lowest estimate by analysts. The maker of Sonata and Tucson vehicles was expected to post 1.5 trillion won in quarterly profit, according to a survey of analysts by FactSet, a financial data provider.
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2 comments:
Allow me to let you in on a little secret of the automotive industry that you may not realize (most salespeople don't realize this either).
Hyundai has the best warranty of any manufacturer that I am aware of (10yr-100k pwrtrain, 5yr-50k bumper2bumper), however if you sell your Hyundai while still under warranty it gets cut in half, making it the same as most other manufacturers. Hyundai basically had to have that warranty when they first hit US shores because of quality issues hurting sales (and they were junky). In the last 10 or 12 years the quality of Hyundai cars has shot up dramatically, and I would put one up against any Honda or Toyota as far as durability.
There is however a downside to this warranty and that is that you are losing 1/2 one of the biggest selling points of the car when you buy used. This lowers the value of a Hyundai trade, making it look like they are not holding their value because they are bad cars (they are not).
Back to Honda and Toyota, I'm sure that most of you have heard of the "certified-used" program that both these manufacturers offer. If you are buying a "certified-used" car you are not buying anything special. There is not much done to inspect it that isn't already done in a normal Maryland inspection. A dealership knows just as much about how a used Toyota was cared for as a used Hyundai, just what they can see from the outside.
There is a trick going on here though. When you buy that Honda or Toyota certified vehicle, the only thing that you are doing is buying a car that has already had an extended warranty rolled into it. When you go into the finance office at the dealership you can buy an identical extended warranty for the Hyundai as well. When they "certify" it though, the warranty that you would typically but separately is rolled into the cost of the car.
The result is that Honda and Toyota are able to artificially inflate the resale value of their cars by forcing the extended warranty on anyone buying a late model low mileage car. At the same time the Hyundai is losing artificially because nothing about the physical car has changed. It was still built to meet the demands of a 10 year warranty. This even affects lease prices of new vehicles because they are based on projected resale value at the end of the lease.
2:27-If it matters,I drive cars until the wheels fall off,so the Hyundai warranty would suit me perfectly.I am lucky to get a $1500 trade in allowance when I finally do trade in after driving the vehicle for 15 or so years.
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