SEOUL -- Hyundai Motor is hopeful that the semiconductor shortage afflicting the global auto industry will ease next quarter and that its sales will return to pre-pandemic levels this year, according to the company’s executive vice president, Gang Hyun Seo.
The shortage will continue in the first quarter due to the spread of the Omicron variant, Seo said.
"The normalization of auto chip supply and demand is expected in the third quarter, when the capacity of semiconductor companies is expected to rise," Seo said on Tuesday after Hyundai posted its quarterly earnings.
The prolonged COVID-19 pandemic in Southeast Asia and resulting chip sourcing troubles pushed Hyundai's sales to less than the targeted 4 million vehicles in 2021, he said.
Southeast Asia is central to the supply of basic chips that drive the world's cars, smartphones and home devices, with Malaysia's chip assembly industry accounting for more than a tenth of a global trade worth over $200 billion. COVID-related lockdowns in the region have disrupted several industries since last year.
Hyundai said operating profit in the three months through December fell 6.8 percent from a year earlier to 1.53 trillion won ($1.28 billion).
Consolidated net income slid 57 percent to 546 billion won. Sales, however, were 31 trillion won, up 6.1 percent and marginally higher than estimates thanks to a weaker Korean won and sales of value-added products.
The automaker's global retail sales declined 15 percent last quarter, with a slump of 43 percent in China. South Korea and North America sales fell 8.9 percent and 7.9 percent, respectively. Europe was an outlier with a 7 percent increase.
Hyundai aims to sell 4.32 million vehicles this year, including a 30 percent increase in eco-friendly cars. They will account for up to 40 percent of sales in Europe versus 32 percent in 2021, the company said. Its new Ioniq 6 full-electric-car will be released in South Korea in the first half.
The automaker said it expects a 20 percent sales jump in North America, its biggest market, in 2022.
Hyundai's share of the global EV market is estimated to be 5.7 percent based on sales from January to November in 2021, according to data from Seoul-based Hana Financial Investment.
In addition to supply-chain snags, higher commodity prices have been a burden on earnings. Hyundai said in November that cost of iron ore in the third quarter jumped 63 percent from a year earlier to $165 a ton, while aluminum rose 40 percent to $2,384 a ton, and copper climbed 48 percent to $9,188.
Reuters contributed to this report