Hankook posts significant Q1 earnings growth

SEOUL, South Korea — Hankook Tire & Technology Co. Ltd. reported significant first-quarter operating profit growth, due mainly to external developments such as lower costs.

The South Korea-based tire maker reported a 108.8% increase in first-quarter operating profit to $295 million on 1.1% higher sales of $1.5 billion.

Hankook linked the improved margins to "external changes" such as the stabilization of raw material prices and freight costs.

"Prices of raw materials such as synthetic rubber and carbon black were maintained at a decent level, as did ocean freight costs, contributing to this quarter's solid performance," the tire maker said.

The company achieved this growth, it said, despite the global economic downturn and tensions in the Middle East.

The company's business in North America dropped 10.1% during the quarter, dropping to $406 million. Hankook attributed the decline to "intensified competition" in passenger/light truck tires and weakened demand for truck/bus tires.

Hankook said its focus on electric vehicle tires, particularly, had brought it to "the forefront of the worldwide EV tire market."

"Hankook Tire has yielded success by leading the EV tire market and expanding sales of high-value products," Hankook said.

During 2023, Hankook said it continued diversifying its portfolio for the EV tire brand iON and is selling 202 tire specifications covering rim diameters of 16 to 22 inches.

This year, Hankook said it aimed to boost the proportion of EV tires in its passenger car and light truck (P/LT) OE supply to 25%.

In P/LT sales, the proportion of sales of high-inch passenger tires (18 inches and above) was 46.8%, up 3.3 percentage points year-on-year.

Breaking down by region, the share of high-inch passenger tires was highest in China at 62.5%, followed by South Korea at 56.5%, North America at 56.4% and Europe at 37.4%.