Kia Lost a Fifth of Its Value in a Year of US Sales Records

Kia’s stock market value fell 20.6 percent between January 2 and November 4, from 47.08 trillion won to 37.4 trillion won, in a year in which Kia America has set six straight monthly sales records. Over the same stretch Hyundai Motor lost 5.6 percent of its value, falling from 61.12 trillion won to 57.68 trillion won.

Together the two companies are worth 95.08 trillion won, down 13.12 trillion won or 12.1 percent since the first trading day of the year, according to Korea Exchange figures. The slide has pushed Kia from 10th to 17th among the most valuable companies on the KOSPI, excluding preferred shares, and Hyundai from fifth to eighth.

The figures were compiled by the Seoul Economic Daily, which tied the decline to a stronger won that is expected to lower next year’s profit, tougher competition in electric vehicles, including a rising share for Chinese-made cars and a fiercer fight in Europe, and heavier sales incentives combined with a bigger share of low-margin models, mainly at Kia as it pushed EV sales hard. Goldman Sachs has downgraded Kia to neutral from buy and cut its target price to 120,000 won from 210,000 won, citing slowing profit growth and a lack of near-term catalysts, while brokerages the paper did not name are trimming their targets for Hyundai to reflect lower profit next year.

Kia’s third quarter weighed hardest. Its operating profit of about 1.82 trillion won came in 22.9 percent below what analysts expected, the paper said, while Hyundai’s 2.68 trillion won beat expectations by about 10 percent, though the paper noted that much of Hyundai’s gain came from exchange rates and one-off cost savings. Kang Sung-jin, an analyst at KB Securities, pointed to Kia’s choice to expand EV sales sharply while accepting narrower margins.

None of that has shown up in American showrooms. Kia America sold 80,008 vehicles in October, up 16 percent from 69,002 a year earlier, with retail sales up 20 percent, electrified sales up 112 percent and hybrid sales up 114 percent. Through October it has sold 747,394 vehicles against 705,150 a year ago, and the new EV3 added 976 sales in October. "With six consecutive months of record-breaking sales, Kia is accelerating toward a fourth straight annual sales record," said Eric Watson, Kia America’s vice president of sales operations.

Kia also set a record in September, when its EV sales fell even as the total climbed. For Hyundai, Jang Moon-soo, head of research at Hyundai Motor Securities, told the paper that establishing Robotics America, the group’s robotics production unit, and giving that business concrete shape are urgently needed.

The HyundaiHQ Take

A carmaker that sets sales records every month while its shares fall by a fifth is telling two different stories to two different audiences, and right now Seoul’s investors believe the profit story more than the sales one. That puts Kia in a tight spot heading into 2027, because the incentives that have made the Telluride, Sportage and EV3 such strong sellers here are exactly what Goldman and the Korean brokers are punishing. If Kia responds by pulling back on discounts, American buyers will feel it first, so the next few months of incentive spending may be the best read on which audience Kia decides to please.