Hyundai Surpasses Volkswagen to Become World’s Second Most Profitable Automaker

Hyundai Motor Group has achieved a significant milestone, surpassing Volkswagen Group in operating profit for the first time in 2024 and securing its position as the world’s second most profitable automaker. This achievement comes despite ongoing challenges in the global automotive industry, including U.S. Tariffs and fluctuating demand for electric vehicles.

Key Highlights

• Profitability Leap: Hyundai Motor Group recorded an operating profit of 20.546 trillion Korean won ($17.5 billion) in 2024, exceeding Volkswagen’s 8.9 billion euros (approximately 15.3 trillion won). Business Korea
• Sales Volume: While Toyota Group remains the global sales leader with 11.32 million vehicles, Hyundai Motor Group sold 7.27 million vehicles, maintaining its third-place position, followed by General Motors (6.18 million) and Stellantis (5.48 million). Sedaily
• Toyota Leads: Toyota Group continues to lead in both revenue (50.45 trillion yen, approximately $471.2 billion) and operating profit (4.31 trillion yen, approximately $40.2 billion). Sedaily

Strategic Adjustments Drive Success

Hyundai Motor Group’s success is attributed to strategic adjustments in production and sales, effectively mitigating the impact of U.S. Automotive tariffs and navigating a temporary slowdown in electric vehicle demand. The company focused on expanding local production, particularly in the United States with preparations for a dedicated EV plant in Georgia and adjustments at existing facilities in Alabama and Georgia. Business Korea

Shifting Sales Mix and Profit Margins

A key factor in Hyundai’s improved profitability is a shift towards higher-value vehicles, including SUVs and models from its luxury brand, Genesis. Increased sales of hybrid and electric vehicles have also contributed to higher profit margins. Hyundai Motor Group achieved an operating profit margin of 6.8%, second only to Toyota’s 8.6%, while Volkswagen Group’s margin stood at just 2.8%. Sedaily

Challenges and Outlook

Despite Hyundai’s strong performance, the global automotive industry faces ongoing challenges, including geopolitical tensions, fluctuating raw material prices, and increasing competition from Chinese electric vehicle manufacturers. These factors are expected to create a more volatile market environment in the coming year. Sedaily

Industry analysts expect Hyundai Motor Group to maintain its profitability by continuing to focus on high-value models and adjusting its regional production strategies. The industry is shifting away from a sales-centered approach to one focused on profitability, making it a core competitive variable. Sedaily

Financial Performance of Other Major Automakers (2024)

• General Motors: Revenue of $185 billion (approximately 272.2 trillion won), adjusted operating profit of $12.7 billion (18.7 trillion won). Sedaily
• Stellantis: Revenue of 153.5 billion euros (263.3 trillion won), operating loss of 840 million euros (1.4 trillion won). Sedaily
• Volkswagen Group: Revenue of 321.9 billion euros (approximately 551.9 trillion won), operating profit of 8.9 billion euros (15.3 trillion won). Sedaily