Renault Samsung Motors Co. Ltd., the South Korean unit of French automaker Renault SA, said today that it expected sales growth to fall sharply this year amid a slowdown in the economy and a firmer won currency.
Renault Samsung said it aimed to sell 172,300 vehicles in 2007, up 7.4 percent from 160,408 units last year, which would be at a growth rate way below 2006's 34.8 percent jump.
"In consideration of the internal and external environments facing the domestic automotive industry, including difficult economic conditions and the appreciation of the won that has continued from early this year, Renault Samsung Motors set its sales target for 2007 at 172,300 units," Jean-Marie Hurtiger, Renault Samsung's CEO told reporters.
That compared with top South Korean auto maker Hyundai Motor Co.'s goal to sell 2.74 million units this year, up 9.4 percent from 2006.
Analysts says sales of South Korean auto makers will face challenges at home and abroad amid fierce competition with global peers and weak consumer sentiment in Asia's third-largest economy. South Korea's auto makers plan to launch few new models to boost sales.
Renault Samsung plans to launch a new sport utility vehicle in the fourth quarter of this year, which the company expects to help increase sales.
Renault Samsung Motors said it posted an operating profit of more than 200 billion won last year, helped by higher sales and cost cuts, compared to 128 billion in the previous year.
Also, its sales increased to 2.58 trillion won last year from 2.19 trillion won in 2005.
Renault has an 80.1 percent stake in the South Korean car maker, which had 12.2 percent of the sedan market in Asia's third-largest economy.
Renault took a majority stake in the former Samsung Group unit.