This article is from the comprehensive economic media outlet Hanyang Economy.
In the U.S., Hyundai Motor has been setting new quarterly and monthly sales records, but its stock price remains stagnant in the domestic market. The obvious correlation of ‘performance improvement = stock price increase’ doesn’t seem to apply here due to the uncertainty surrounding U.S. tariffs, which the market collectively points to. Tariffs are simultaneously constraining cost and pricing strategies, solidifying a valuation discount. If signals indicating a resolution of the tariff issue emerge, expectations for a recovery in stock prices will rise, but there are concerns that protracted negotiations will further impair perceived gains and losses.
On the 14th, Hyundai Motor’s stock price on the KOSPI closed at 223,000 KRW, up by 2.06%. Over the last month, it has increased by 3.26%, remaining within a narrow range. Comparing a one-month KOSPI growth rate of 4.58% and a six-month rate of 45.21%, Hyundai’s stock performance, rising only by 23.81%, significantly lags behind, indicating it hasn’t participated in the KOSPI rally.
Despite record sales in the U.S. in September with an increase of 14% year-over-year, the stock price remains sluggish due to the ‘tariff variable.’ While the U.S. is actively pursuing a reduction in tariffs on Japanese passenger cars to 15%, the 25% tariff on Korean cars remains prolonged. Hyundai lowered its 2025 operating profit margin target by 1 percentage point to 6~7% during the September New York Investor Day. Despite raising revenue forecasts, guidance for profitability was conservatively adjusted due to tariffs and marketing costs. The market now sees this adjustment as evidence of the tension between maintaining ‘topline growth’ and ‘tariff cost impacting profits.’
Analysts like Kang Seong-jin from KB Securities have warned that the positive sales performance may have limited contributions to operating profit and that delays in tariff negotiations pose a persistent risk to profitability forecasts. Meanwhile, SK Securities analyst Yoon Hyuk-jin notes the potential rise in tariff-related costs as U.S. electric vehicle market dynamics change and inventory secured before the tariff implementation depletes. However, he’s optimistic regarding Hyundai’s market share in the U.S., despite tariff rates putting it at a competitive disadvantage.
The timing of any resolution through Korea-U.S. tariff reduction negotiations is critical. Although there’s consensus on the general direction, an implementation timeline hasn’t been set, which broadens the gap between the optimistic “it will happen” and the uncertain “when it will happen.” Any clarity on the signing and implementation of tariff reductions might immediately elevate performance estimates and cause stock prices to be reevaluated. In the interim, expanding the share of high-margin vehicle models like hybrids, SUVs, and Genesis will partially offset tariff costs, with promotions and rebates toward the year’s end crucial for preserving profitability.
Hyundai’s stock continues to face pressure from the ‘policy variable’ of ongoing tariffs, despite strong sales in North America. If tariff delays persist, it’s likely this defensive trend will continue until each quarterly earnings announcement, necessitating downward adjustments in expectations. The sluggish stock performance stems more from ‘policy timing’ issues rather than fundamental failures, indicating that any shift in tariff news could quickly reflect on the stock chart.
Meanwhile, Deputy Prime Minister Koo Yoon-cheol has requested a meeting with U.S. Treasury Secretary Scott Bessent on the 15th, expressing his intention to ensure practical resolutions prioritizing national interests. The market is keenly observing how the U.S., maintaining its $350 billion cash investment direction, will respond to the various alternative investment proposals, including technological collaboration, joint development, and financial support, presented by Korea.