Hyundai Q2 profit hits record on U.S. and China demand

Hyundai Motor Co (005380.KS), South Korea's top automaker, said on Thursday its quarterly net profit rose 71 percent to a record high, beating estimates on healthy demand in the United States and China.

Hyundai, which with its affiliate Kia Motors Corp (000270.KS) is the world's No.5 car maker, may face a tougher road ahead in the second half on worries over the strength of the U.S. and European economies as well as rising raw material costs.

But new models, such as a revamped version of its best selling Elantra compact, will help it recapture domestic customers from its competitors, analysts said.

"We aim to reduce costs and increase market share with new product launches in the second half to fight uncertainties stemming from the potential global economic slowdown," Hyundai said in a statement.

China, which surpassed the United States to become the world's top auto market last year, could see an easing economy due to expected monetary tightening later in this year.

In the second quarter, Hyundai's volume sales to China rose 17.4 percent from a year earlier, while domestic volume sales fell 17.5 percent during the same period, the company said.

Hyundai's U.S. volume sales during the April-June jumped 32.6 percent from a year earlier and its market share rose to a record 5.2 percent in June, despite sharply reduced incentives given to customers in the country.

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