Ssangyong Motor Reports Profit in Q2 2013

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Ssangyong Motor, the Mahindra Group owned Korean auto maker, announced that it sold 29,286 units in the Korean market and exported 40,174 units (including CKD), selling a total of 69,460 units in the first half (January to June) of 2013. It reported revenue of 1,660.6 billion won, operating loss of 14.3 billion won and a net loss of 3 billion won. The operating loss of 14.3 billion won is 70% less than the previous year’s H1 loss of 48.6 billion won.

Ssangyong Motor’s first half sales volume and revenue grew by over 22% compared to the same period last year, resulting in another record performance since H1 of 2007 when the company sold 69,755 units.

Commenting on the results, Dr. Pawan Goenka, Chairman of the Board, Ssangyong Motor said, “”The financial performance of Ssangyong for the second quarter of this year is another significant step forward for the company. This turnaround is being driven by the increasing appeal of its new and refreshed product line-up coupled with an intense focus on greater operational efficiencies.

According to Lee Yoo-il, CEO, Ssangyong Motor, “the combined effort to increase sales of our face-lifted models and ensure profitability, coupled with synergies derived from the Mahindra Group has helped turn around the company in the second quarter.” He added “we will continue to further increase our sales with the introduction of improved models such as the New Korando C in the second half which will help improve our profitability.

Ssangyong Motor was the only automotive company that recorded growth among the Korean automakers despite the sluggish domestic automotive market in the first half. During this period, the market saw a 2.6% decline in demand compared to the previous year. Ssangyong was able to increase sales with the newly launched Korando Turismo and other brands in the Korando family recording a growth of over 34% in the Korean market.

In exports, Ssangyong was able to continue with the sales growth trend by recording a 15.4% increase over the same period last year due to increased volume in overseas markets including Russia, Latin America and India. In the second quarter, Ssangyong recorded sales volumes of more than 12,000 units for three consecutive months largely due to the success of the Korando Turismo, to record sales of 38,195 units.

As a result, the company recorded a net profit of 6.2 billion won in the second quarter, compared to a loss of 21.5 billion won in Q2 of the previous year, signaling a steady improvement in the company’s performance.

Ssangyong reported a quarterly profit for the first time in six years since the third quarter of 2007 except for the third quarter of 2010, when there was a profit on account of gain from disposal of idle assets of 112.5 billion won during the rehabilitation process.

Ssangyong Motor also started a two-shift system at its Korean plant in May to actively meet growing demand for SUVs, and it successfully concluded its wage negotiations on July 25th without strike for the fourth consecutive year, demonstrating stable labor-management relations in the company, based on which Ssangyong is fully concentrating on production and sales to achieve a turn around.

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