Posted Jul 30th 2012 6:45PM
Bloomberg reports Kia has missed analyst profit estimates for the second quarter after net income slipped to US$965 million at current conversion rates. On average, analysts estimated the South Korean automaker would bring in somewhere around US$1.1 billion, though Kia did see its revenue increase by 8.4 per cent. The automaker said its less-than-estimated profit results came down to increased spending as the company strove to market its new Pride subcompact and K9 luxury sedan (a model that will be known as Quoris in other markets). Kia also saw its operating profit increase by 18 per cent, falling just shy of industry estimates. But additional marketing wasn't solely to blame for the missed goals.
The report also indicates recent strikes by workers vying for better pay and reduced hours may have had an impact on the bottom line as well. All told, Kia estimates the company lost production of 5,450 units worth somewhere around US$82.5 million during strikes held on July 13 and 20.
The news isn't all dark and stormy, however. Kia sales in China blossomed by around 18 per cent, and Europe saw an even bigger increase of around 25 per cent thanks largely to the introduction of the Pride. Europe saw its industry-wide sales slacken by 3.2 per cent by comparison.