South Korea’s largest automaker will sell three new models including the SUV and upgrade some existing ones this year, BAIC Motor Corp, Hyundai’s Chinese partner, said in a statement on Thursday. The local joint venture, Beijing Hyundai, cut production and supply to ease pressure on dealers after retail sales fell 30% in the January-to-February period, it said.
Hyundai’s deliveries slumped in the first two months after a tax cut on small-engine capacity cars was rolled back at the start of the year, only to be compounded by a drop in showroom visits and postponement of purchases after South Korea deployed a US missile system, a move that was opposed by China.
“Under the confluence of multiple negative factors, Beijing Hyundai had weaker end-market performance than other brands,” BAIC said in the statement. “Beijing Hyundai will boost market confidence via proactive adjustment measures to ensure it meets full-year sales goal.”
Beijing Hyundai brought forward and used the down period to perform routine maintenance work, preparing for a rebound in the market, BAIC said.
The US missile defence system being deployed in South Korea, called Terminal High Altitude Area Defense system, or Thaad for short, is raising diplomatic tensions with China. The shield is supposed to help South Korea protect itself from a North Korean missile strike.
Hyundai’s shares have climbed 1.4% this year, trailing the 6.2% gain in the benchmark Kospi index.