Hankook Tire Sales Exceed $1 Billion for Third Consecutive Quarter despite Economic Pressures
- Global sales record $1.06 billion, increasing by 24% year-on-year and 2.5% quarter-on-quarter
- Ultra-high performance (UHP) tire sales grow by 40% year-on-year
- Sales to North America increase 37% despite reported consumer slowdown
- Ongoing investment in technology and increased marketing activities maintain strong growth in face of 34.8% year-on-year increase in raw material cost
SEOUL, KOREA, October 31, 2008 - Hankook Tire (www.hankooktire.com), the seventh-largest and one of the fastest growing tire manufacturers in the world¹, today announced third quarter year-on-year global sales growth of 24 percent year-on-year and 2.5 percent quarter-on-quarter. For the third consecutive quarter this year, sales were driven by year-on-year gains of over 40 percent in its profitable ultra-high performance (UHP) tire business, an area reflecting Hankook Tire’s increasing global reputation for the quality and technology behind its products.
Hankook recorded sales of $1.06 billion over the quarter, marking the third consecutive quarter where sales exceeded $1 billion, which the company had not achieved prior to 2008. The tire industry, however, is still experiencing pressure as raw material costs increased again by 34.8 percent year-on-year. The cost of natural and synthetic rubber increased by 30.9 percent and 72.9 percent year-on-year, respectively. Hankook Tire’s operating profit margin decreased 45.2 percent year-on-year due to these economic pressures as well as fluctuating currency rates deriving from the unstable global economy.
Mr. Seung Hwa Suh, Global CEO of Hankook Tire said, “Hankook Tire should continue to focus on what has been differentiating and fueling our consistent double-digit growth over the last several years: the quality of our tires and the technology behind them. Experts and consumers are showing increasing trust and recognition of our tires as evidenced by tire test results in Europe and our ongoing success in winning new customers and gaining market share. There are great opportunities for Hankook Tire to emerge strongly from this current period of economic pressure on all tire makers.”
In spite of challenging market conditions, year-on-year sales performance for Hankook Tire remains strong throughout key regions and within key business units. Thanks to a consistent focus on quality and fostering stronger ties with retail channels, sales within the UHP business accounted for $103.4 million, increasing by 40 percent (UHP tire exports from Korea increased by 26.3 percent)². The North America market saw sales increase by 37 percent while Europe continued to grow by 14 percent. Hankook Tire continued to show strong sales increase in emerging and newer markets. Sales to Other Markets³ increased by 55 percent, while sales to growing markets in Europe such as Russia increased significantly by 158 percent.
Hankook Tire continues to sustain double-digit growth thanks to consistent investment of approximately 5 percent of revenue into technological innovation, and building the Hankook Tire brand by leveraging its growing OEM reputation and conducting ‘smart marketing’ activities, programs that return multiple benefits for the company. This increasing reputation been proven by a series of auto magazine consumer tests, particularly in Europe.
¹ According to Modern Tire Dealer (Jan. 2008)
² Year-on-year figures based on FOB price
³ Other Markets comprise sales from Latin America, Asia Pacific, Africa and the Middle East
2008 Consolidated Profit
Currency rate: Percentage changes differ because of exchange fluctuations
||990.6 million USD
||1.06 billion USD
||83.8 million USD
||39.8 million USD
*Average Currency Rate
About Hankook Tire Co., Ltd
Hankook Tire (CEO: Seung Hwa Suh) is the seventh largest and one of the fastest growing tire manufacturers in the world. It produces innovative, superior quality, and high performance radial tires for passenger cars, light trucks (SUVs, RVs, etc.), trucks, buses and special motor sports vehicles. It invests approximately five percent of revenue in research and development and develops cutting-edge technologies through its five global R&D Centers meeting regional customer demands and enhancing customer satisfaction. Selling in 185 countries around the world, the company has more than 14,000 employees around the world. Approximately 70 percent of revenue comes from growing overseas sales.
For more information, please visit Hankook Tire’s web site at www.hankooktire.com.
About Hankook Tire America Corp.
Headquartered in Wayne, N.J., Hankook Tire America Corp. is a technology-focused, market-driven company that markets and distributes a complete line of high performance and ultra-high performance passenger, light truck and SUV tires, as well as medium truck and bus tires to more than 400 independent dealers through 3000+ retail sales locations in the United States and Canada.
For more information, please visit the Hankook website at www.hankooktireusa.com
||Melissa Vander Laan
|Director Brand Communication
||Senior Account Executive
|Hankook Tire America Corp
|Phone: 973-633-9000 x 531