[Edaily LEE YUNHWA Reporter Lee Bae-woon] #HyundaiMotor and KIA CORPORATION(000270)both posted record-high quarterly sales in the second quarter of 2026 (April–June). However, amid an unfavorable external environment—including U.S. tariffs, rising raw material prices, and production disruptions caused by suppliers—both companies saw their operating profits decline year-over-year, reflecting a trend of “growth in revenue but a decline in profitability.”

According to HyundaiMotor and KIA CORPORATION on the 24th, the two companies’ combined revenue for the second quarter totaled 82.2523 trillion won, a 5.9% increase compared to the second quarter of 2025 (77.6363 trillion won). In contrast, combined operating profit stood at 5.4794 trillion won, a 13.9% decrease from the second quarter of 2025 (6.3664 trillion won).

Looking at the cumulative figures for the first half of 2026, the contrast between growth and decline is even more pronounced. HyundaiMotor’s revenue for the first half of 2026 was 95.1542 trillion won, a 2.7% increase compared to the first half of 2025 (92.6944 trillion won), but its operating profit plummeted 25.8% to 5.3656 trillion won. KIA CORPORATION’s revenue for the first half of 2026 was 62.5389 trillion won, a 9.0% increase compared to the first half of 2025 (57.3671 trillion won), but its operating profit fell 16.3% to 4.8336 trillion won.

Combined revenue for the two companies in the first half of 2026 was 157.6931 trillion won, a 5.1% increase compared to the first half of 2025 (150.0615 trillion won). In contrast, combined operating profit was 10.1992 trillion won, a 21.6% decrease compared to the first half of 2025 (13.0086 trillion won). Although sales volume increased, the burden of tariffs and incentive costs weighed on profitability.

HyundaiMotor announced during a conference call the previous day (the 23rd) that it recorded revenue of 49.2153 trillion won and operating profit of 2.8509 trillion won for the second quarter of 2026. Revenue increased by 1.9% compared to the second quarter of 2025, setting a new all-time high on a quarterly basis. Strong hybrid (HEV) sales and favorable exchange rate effects—including the appreciation of the won against the dollar—offset the decline in sales volume. In fact, while wholesale sales in the second quarter of 2026 fell 6.9% year-over-year to 991,885 units due to production disruptions caused by a fire at a parts supplier, the share of HEV sales rose to 18.9%, the highest ever for a single quarter. On the other hand, operating profit fell by 20.8% due to rising raw material prices and the aftermath of production disruptions, and the operating profit margin stood at 5.8%.

At an investor briefing held that day, KIA CORPORATION announced second-quarter 2026 revenue of 33.37 trillion won and operating profit of 2.6285 trillion won. Revenue rose 12.6% compared to the second quarter of 2025, setting a new quarterly record, while wholesale sales also increased by 4.5% to 851,639 units. Rising demand for electric vehicles (EVs) in South Korea and Europe, and for hybrid vehicles (HEVs) in the U.S., drove revenue growth, expanding the share of xEV sales to 35.3%. However, operating profit fell by 4.9% due to expanded incentives to compete with Chinese EV brands in Western Europe and the domestic market, as well as an increase in sales warranty provisions resulting from the weak won. The operating profit margin stood at 8%, marking the third consecutive quarter of growth since hitting a low of 5.1% in the third quarter of last year.

The industry views new model launches in the second half of the year, the expansion of local production in the U.S., and increased sales of eco-friendly vehicles as key factors for a turnaround in performance. HyundaiMotor plans to make up for lost volume in the second half by launching a large number of high-volume new models, starting with “The New Grandeur” and followed by the Avante. A HyundaiMotor official stated, “To minimize the impact of domestic production disruptions, HyundaiMotor made maximum use of its inventory in the second quarter, and we expect to make up for a significant portion of the lost volume through expanded production in the second half of the year.”

KIA CORPORATION plans to begin delivering the Sportage Hybrid—produced at HyundaiMotor Group’s Meta Plant America (HMGMA) in Georgia, U.S.—to customers starting in the second half of the year, while in Europe, it aims to enhance the price competitiveness of mass-market EV models by locally producing the EV2 and EV4.

A KIA CORPORATION official stated, “We believe there is potential for approximately 10% year-over-year growth in the second half,” adding, “Although there are risks in the Middle East, we believe we can achieve the sales targets set at the beginning of the year based on balanced growth across all regions. Financially, we also expect to achieve the annual operating profit of 10.2 trillion won set for this year.”

However, given the ongoing external variables—such as the war in the Middle East, U.S. tariffs, and global competition over incentives—the pace of profitability recovery in the second half of the year is expected to be the key factor in determining whether the company can meet its annual performance targets.