[Edaily Reporter Kim Hyung-wook ] HANKOOK TIRE & TECHNOLOGY posted record-high quarterly revenue in its tire division during the third quarter, driven by expanded sales of high-value-added products. However, operating profit declined slightly year-over-year due to rising raw material and logistics costs stemming from the war in the Middle East.
Hankook Tire announced on the 6th that its tire division’s revenue reached 2.8083 trillion won, a 3.7% increase from the previous year and a record high for a single quarter. This figure is 1 billion won higher than the previous record of 2.8073 trillion won set in the second quarter of this year.
The rise in sales was driven by increased sales volume combined with a strengthening won-dollar exchange rate. In particular, Hankook Tire has recently been increasing the sales share of high-inch tires (18 inches and larger)—which are relatively high-value-added products—and tires specifically designed for electric vehicles. In the third quarter, the sales share of high-inch tires (18 inches and larger) reached 49.4%. Among original equipment (OE) tire sales for passenger cars and light trucks, the share accounted for by tires specifically designed for electric vehicles reached 32.3%.
However, operating profit fell 2.6% year-over-year to 505.9 billion won. Geopolitical instability in the Middle East caused a simultaneous rise in raw material costs—such as rubber—and logistics expenses, leading to increased cost pressures. While the expansion of high-value-added products partially offset this burden, it did not translate into an increase in operating profit.
The industry expects these cost pressures to persist for the time being due to the prolonged conflict in the Middle East. Furthermore, as the European Union (EU) plans to impose anti-dumping and countervailing duties of approximately 20% on Chinese-made tires in early December, there is a high likelihood of additional cost burdens arising from exports to Europe from Hankook Tire’s Chinese plants.
Hankook Tire plans to strengthen its market competitiveness by responding to changes in demand in major markets through expansions of production facilities at its Tennessee and Hungary plants, while simultaneously expanding original equipment (OE) supply partnerships with global automakers.
Meanwhile, Hankook Tire’s global consolidated third-quarter revenue, including the results of its subsidiary Hanon Systems, reached 5.465 trillion won, a 1.0% increase year-over-year. Operating profit rose 2.2% to 598.8 billion won.
On a consolidated basis, operating profit marked a record high for a single quarter, while revenue reached a record high for the third quarter. The all-time high consolidated revenue was 5.6824 trillion won, recorded in the second quarter of this year.
Hanon Systems, a provider of automotive thermal management solutions, posted revenue of 2.6569 trillion won for the same period, down 1.8% year-over-year, but its operating profit rose 26.6% to 103.7 billion won.
