Hyundai Misses Estimates After Tariff Hit, Warns of Tough 2026

SEOUL, Jan 29 (Reuters) – Hyundai Motor reported a sharper-than-expected 40% drop in fourth-quarter operating profit on Thursday, as U.S. auto tariffs continued to weigh on earnings, marking the company’s third consecutive quarterly decline.

The South Korean automaker posted operating profit of 1.7 trillion won ($1.19 billion) for the October–December period, down from 2.8 trillion won a year earlier and below the 2.7 trillion won LSEG SmartEstimate based on 17 analysts.

The profit slump follows the U.S. government’s decision under President Donald Trump to impose 25% tariffs on imported vehicles in April, later reduced to 15% in November after a trade deal with Seoul. However, uncertainty resurfaced this week after Trump said tariffs on South Korean autos and other imports could be raised again due to delays in implementing the agreement.

Hyundai, together with affiliate Kia, the world’s third-largest automaking group by sales, expects challenging conditions to persist amid slowing demand in key markets and intensifying competition in emerging economies.

Despite near-term pressures, Hyundai forecast higher sales and profitability in 2026 and said it aims to lift its operating profit margin to 6.3%–7.3% this year, up from 6.2% in 2025, driven by higher vehicle shipments and increased sales of premium models.