Published by Global Banking & Finance Review®
Posted on January 23, 2025
3 min readLast updated: January 27, 2026
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Hyundai Motor forecasts slower revenue growth in 2025 due to U.S. tariffs and softening EV demand, while exploring a deal with GM for commercial EVs.
By Hyunjoo Jin
SEOUL (Reuters) -South Korea's Hyundai Motor said on Thursday it is in talks with General Motors to supply commercial electric vehicles to its U.S. peer, as it expects sales growth to halve this year due to softening demand.
It also flagged policy risk in the United States with U.S. President Donald Trump taking office with promises of import tariffs, though it said any negative impact will be greater for Japanese rivals.
The automaker, which signed a preliminary tie-up deal with GM last year, also said it aims to sign binding contracts on cooperation in parts procurement and passenger and commercial vehicles within the first quarter of this year.
"We are considering re-badging our commercial EVs and supplying GM... The deal will pave the way for our entry into the North American commercial vehicle market," Hyundai Chief Financial Officer Lee Seung Jo said on an analyst call.
The talks come as automakers brace for policy uncertainty in the U.S., the world's second-largest auto market, that could upend demand. This week U.S. President Donald Trump said he could impose 25% tariffs on Canada and Mexico from Feb. 1.
Meanwhile, political turmoil has rattled confidence on Hyundai's doorstep in Seoul.
"We expect more business uncertainties this year than ever before due to potential policy changes not just in the home market but also in the U.S., while there will be tougher emission rules in Europe," Lee said.
Hyundai expects to suffer less impact from U.S. tariffs than Japanese rivals including Toyota Motor and Honda Motor which have bigger manufacturing presence in Mexico and Canada.
The South Korean automaker said it plans to further localise production in the U.S. to minimise any tariff impact. It also said it will make hybrid vehicles at its new factory in Georgia.
SLOWING GROWTH
Hyundai, which with affiliate Kia is the world's third-biggest automaker by sales, on Thursday forecast 2025 revenue growth of 3.0% to 4.0%, versus 7.7% a year earlier. It expects an operating margin of 7.0% to 8.0%, from 8.1% in 2024.
Hyundai flagged uncertainties including slowdown in major markets, slowing EV demand and macroeconomic volatility, as Trump said he would consider scrapping EV purchase tax credits.
A plunge in the won that began early December after South Korea's now-impeached president declared martial law will boost repatriated earnings but also inflate vehicle warranty provisions, hitting profit margins, Hyundai said.
For October-December, Hyundai reported operating profit of 2.8 trillion won ($1.95 billion) as it spent on promotions in a slowing car market.
That was lower than a 3.2 trillion won average of 24 analyst estimates compiled by LSEG SmartEstimate, which is weighted toward estimates from the more consistently accurate analysts.
During the quarter, global retail sales slipped as solid sales in the United States and India were offset by sluggish demand in South Korea, Europe and China.
Hyundai shares were flat after the earnings announcement.
The automaker also said it is considering supplying Ioniq 5 EVs to robotaxi developer Waymo in North America and beyond. Hyundai, which is developing autonomous technology at its Motional unit, said it aims to commercialise robotaxis next year.
It said it is open to listing humanoid robot unit Boston Dynamics but will not consider the matter in the near term.
($1 = 1,436.4200 won)
(Reporting by Hyunjoo Jin; Writing by Miyoung Kim; Editing by Christopher Cushing)
Hyundai forecasts a revenue growth of 3.0% to 4.0% for 2025, down from 7.7% a year earlier.
Hyundai plans to further localize production in the U.S. to minimize the impact of tariffs and will also produce hybrid vehicles at its new factory in Georgia.
Hyundai is facing uncertainties such as a slowdown in major markets, decreasing demand for electric vehicles, and macroeconomic volatility.
For the October-December period, Hyundai reported an operating profit of 2.8 trillion won ($1.95 billion), which was lower than analyst estimates.
Hyundai is in talks with General Motors to supply commercial electric vehicles and is also considering supplying Ioniq 5 EVs to robotaxi developer Waymo.
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