Kia Motors’ profit falls in Q4
South Korean automaker Kia Motors Corp. announced that its net profit during the final quarter of 2004 dropped 42.2% to Won 168.1 billion (around $163.8 million) from Won 290.7 billion a year earlier.
A stronger Won, which jumped 11% against the US dollar in the final quarter of 2004, higher steel prices and heavy marketing costs contributed to Kia's net profit decline.
Because of the decline in net profit, Kia reduced its 2005 sales target to from 1.34 million to 1.21 million units.
The company anticipates no improvement in its earnings until the third quarter of 2005, when consumer demand for autos is expected to rise.
Kia also increased its exports to
Europe, where the stronger Euro enables the company to sell cars at a higher margin.
Kia's auto sales to
Europe accounted for 35% of total exports last year. Kia predicts that sales to
Europe will account for 45% of the company's exports.
The South Korean automaker's exports rose 40.1% to 244'182 units in the final quarter of 2004, while domestic sales fell 14.7% to 64'072 units.