Hyundai Motor Group, the No. 3 automaker worldwide by sales volume, last year for the first time surpassed the operating profit of No. 2 Germany's Volkswagen Group. It sold fewer vehicles than its rivals yet posted higher profitability, proving its competitiveness despite headwinds such as U.S. tariffs and the electric-vehicle chasm (a temporary demand slowdown).
On the 11th, according to the auto industry, Hyundai Motor Group (Hyundai Motor, Kia, Genesis) sold 7.27 million vehicles in the global market last year, maintaining third place in sales behind Japan's Toyota Group (11.32 million) and Volkswagen Group (8.98 million). U.S. General Motors (6.18 million) and Stellantis (5.48 million) followed.
However, there was a shift in rankings on profitability. Hyundai Motor Group's operating profit was 20.546 trillion won, surpassing Volkswagen Group, which posted 8.9 billion euros (about 15.3 trillion won). This is the first time Hyundai Motor Group's operating profit has exceeded Volkswagen Group's.
Toyota Group, No. 1 in sales volume, recorded operating profit of 4.3128 trillion yen (about 40.2 trillion won), also keeping the top spot in profitability. GM, ranked fourth to fifth in sales volume, had adjusted operating profit of $12.7 billion (about 18.7 trillion won), while Stellantis posted a loss of 840 million euros (about 1.4 trillion won).
Hyundai Motor Group's operating margin last year was also 6.8%, ranking second after Toyota Group (8.6%). Volkswagen Group stood at just 2.8%.
Analysts say profitability diverged between Hyundai Motor Group and Volkswagen Group in their strategies for addressing the electric-vehicle chasm and U.S. tariffs.
Hyundai Motor Group quickly shifted production from electric vehicles to hybrids, minimizing the impact of the chasm. In contrast, Volkswagen Group maintained its existing electrification strategy. Volkswagen Group's operating profit plunged 53.5% from a year earlier.
Amid the U.S. tariff environment, Toyota Group and Volkswagen Group responded with price hikes and volume adjustments, but Hyundai Motor Group minimized price increases. As a result, it sold a record 1,836,172 vehicles in the United States last year. It buffered the tariff shock by increasing local production volume, among other measures.
Hyundai Motor Group also bore lower tariff expenses (7 trillion won) than Toyota Group (120 billion yen, 11 trillion won), whose tariffs were cut earlier than Korea's.