Hyundai Motor India posts quarterly profit drop as costs, production disruption weigh
- The carmaker shuts down production at one of its plants in Chennai due to a fire at one of its suppliers
Hyundai Motor India reported a 35.1% drop in first-quarter profit on Thursday, hurt by a jump in costs as well as a production disruption at its Chennai plant.
The unit of South Korea’s Hyundai Motor reported a profit of 8.89 billion rupees ($92.96 million) for the quarter ended June 30, from 13.69 billion rupees a year before.
The carmaker shut down production at one of its plants in Chennai due to a fire at one of its suppliers. However, production was restored by June-end, Hyundai India said.
Vehicle sales in India had recovered following New Delhi’s tax cuts last September, but Hyundai Motor India was unable to fully shield itself from disruptions from the Middle East war that raised raw material costs and impacted exports.
Hyundai India says Chennai plant to resume normal production by June 22
Domestic sales rose 5.4%, while exports dropped 19.6%. This hurt overall revenue, which fell 0.5% to 163.35 billion rupees.
Although the carmaker implemented price hikes during the quarter, higher steel and commodity prices continued to pressure margins.
Total expenses climbed 4.2% to 154.07 billion rupees.
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