Kia sales lift parts affiliates as Hyundai Motor slips

Hyundai Motor Group's major parts affiliates saw diverging sales trends depending on which automaker they supplied. As Kia posted record-high sales in the first half of this year, sales linked to Kia at Hyundai Mobis, Hyundai WIA and Hyundai Transys all rose, while sales linked to Hyundai Motor fell across the board.

According to each company on Friday, Kia sold 1.63 million vehicles worldwide in the first half of this year, up 2.7 percent from the same period last year and marking its best first-half sales on record. Hyundai Motor's first-half sales, meanwhile, fell to 1.97 million vehicles, down from a year earlier and marking its first drop below 2 million in four years, since 2022.

This sales pattern was also reflected in the first-half sales breakdown by customer at Hyundai Motor Group's major parts affiliates. According to Hyundai Mobis's half-year report, Kia and its subsidiaries accounted for 38.2 percent of the company's total sales in the first half, surpassing Hyundai Motor and its subsidiaries at 36.3 percent. In the same period last year, Hyundai Motor and its subsidiaries accounted for 39.9 percent, higher than Kia and its subsidiaries' 35.7 percent -- meaning this is the first time Kia has overtaken Hyundai Motor since Mobis began disclosing the figures.

Applying the disclosed sales-mix ratios to Hyundai Mobis's first-half consolidated sales of 31.89 trillion won ($23.8 billion), sales linked to Kia are estimated at about 12.18 trillion won, up 11.2 percent from the same period last year. Sales linked to Hyundai Motor, by contrast, are estimated at about 11.57 trillion won, down 5.5 percent.

At Hyundai WIA, the tilt toward Kia was even more pronounced. The company's first-half sales tied to Kia rose 15 percent to 2.15 trillion won, up from 1.87 trillion won a year earlier. Sales tied to Hyundai Motor, however, fell 18.2 percent to 353.9 billion won.

The increase in Kia-linked sales coincided with the expansion of new engine production. Hyundai WIA began mass-producing the Gamma2 turbo engine for the K4 at its Mexico factory in the first half, followed by mass production of the Gamma2 turbo hybrid (T-HEV) engine used in the Sportage. The combination of Kia's rising sales and the ramp-up of new engine production appears to have driven the sharp increase in Kia-linked sales.

Hyundai Motor, on the other hand, saw sales decline. A fire at Anjeon Gongeop, an engine valve supplier based in Daejeon, disrupted the supply of engine valves in the first half, affecting production of major models. Hyundai WIA receives parts from Anjeon Gongeop to produce engines, which it then supplies to Hyundai Motor. The fire was a key factor behind the drop in Hyundai Motor-linked sales.

Hyundai Transys discloses combined sales and purchases figures. Its Kia-linked sales and purchases rose 5.1 percent to 767.3 billion won compared with the same period last year, while its Hyundai Motor-linked sales and purchases fell 4.9 percent to 1.14 trillion won.

Hyundai Transys's main projects are manufacturing and selling automotive powertrains and seats. It supplies power-transmission devices such as transmissions and reduction gears, as well as seats for finished vehicles, to Hyundai Motor and Kia. Changes in vehicle production therefore directly affect its sales.

"With Hyundai Motor's sales relatively sluggish, production was further disrupted in the first half by the fire at the parts supplier, which also affected related affiliates," said an industry official. "The key question for the second half is how much of a boost the new models will provide, now that the labor union's strike has ended."

Hyundai Motor plans to expand its new-model lineup in the second half in a bid to turn around its sales performance. Following the launch of the New Grandeur in the first half, the All New Avante went on sale last month. Genesis's GV90 and a fully redesigned Tucson are also set to be unveiled in succession. The GV90, Genesis's first flagship large electrified SUV, is aimed at the premium market. The new Tucson, meanwhile, is expected to launch domestically in the second half of this year and in the United States next year.