Hyundai Europe defers target on dismal outlook
By Christiaan Hetzner
(Reuters) - Hyundai Motor Co's (005380.KS: Quote) European business has deferred its sales and market share target by at least a year due to a dismal outlook that is now starting to worry the stronger carmakers as well as the weak.
Plunging car sales in markets such as Italy, where demand has plumbed lows not seen in decades, has prompted carmakers such as GM's (GM.N: Quote) Opel and Fiat FIA.MI to record heavy losses at their European operations.
"I suspect the whole plan of selling 500,000 cars next year and achieving 5 percent market share in 2015 is being deferred by one year to be realistic, because the market decline exceeded our expectations," said Allan Rushforth, Chief Operating Officer of Hyundai Motor Europe in an interview published on Wednesday.
"So 2013 should give us half a million, with the 5 percent achievable in 2016 at the earliest."
For the current year, Hyundai forecasts sales to rise about 10 percent to 445,000 cars this year and aims for a 3.5 percent share of the European market.
Only five years ago its share was roughly half the size and Rushforth expects to add another 0.1 or 0.2 percentage points in 2013.
Rushforth was relaxed about the outcome of France's request that the EU require South Korea to give advanced warning of planned car exports to the EU, the first step towards the possible re-introduction of duties a year after a free-trade deal came into effect.
"Our business was growing long before the FTA (free-trade agreement) really had a material affect, and it will continue to grow," he said, referring to the gradual phase-out by July, 2016 at the latest of tariff duties that had been as high as 10 percent. Continued...