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Kia Motors sees 35% drop in Q1 profit

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(Globalpost/GlobalPost)

South Korea's Kia Motors said Friday that its first quarter net profit plunged 35 percent from a year earlier due to a strong won and work stoppages.

Consolidated net profit fell to 784 billion won ($706 million) in the January-March period, from 1.2 trillion won a year earlier, the country's second largest car maker said.

Operating profit fell 35 percent from a year earlier to 704.2 billion won, and sales were down six percent at 11.08 trillion won.

The company said that as well as sluggish domestic sales, profits were hurt by the won's strength against the dollar, which had made Kia cars more expensive overseas.

Work stoppages also undermined the bottom line, with Kia workers refusing weekend shifts since March 9.

The company vowed to strengthen profitability through competitive cars and quality, but acknowledged it would face tough business conditions from the second quarter.

Kia is an affiliate of South Korea's largest automaker Hyundai Motor. The two together form the world's fifth-largest carmaking group by sales.

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http://www.globalpost.com/dispatch/news/afp/130426/kia-motors-sees-35-drop-q1-profit