Hankook Tire & Technology announced 2021 financial results with consolidated global sales of KRW 7.142 trillion and an operating profit of KRW 641 billion.
Having recorded solid sales in major regions during the first half of 2021, Hankook Tire was able to continue its steady growth accounting to a 10.7% rise in sales and a 2.2% increase in operating profit year-on-year.
As momentum slowed in the second half with the global economy collectively tackling issues such as the global supply chain disruption, semiconductor shortage and rising raw materials costs, Hankook demonstrated resilience with promising business performance.
Key contributing factors included continued increase in sales of replacement tires, effective regional pricing strategy and strong sales of high-inch tires. Sales of high-inch tires, 18 inches or higher, increased 3.1%p compared to the previous year, accounting for 37.7% among total sales of passenger car tires.
The fourth quarter was particularly a bump in the road for Hankook Tire. The company saw a decline in sales revenue that ended in KRW 1.889 trillion and its operating profit down 61.3% YoY and 51.3% QoQ at KRW 87.9 billion. This decrease was largely due to rise in operational costs and delayed sales opportunities caused by labor strikes at Hankook’s Daejeon and Geumsan plants in Korea.
However, sales of high-inch tires again became the driving engine for growth. High-inch tires sales rose by 1.5%p YoY to account for 38.9% among total sales of passenger car tires in the fourth quarter. In particular, high-inch tire sales in China amounted to 46.4%, a 6.7%p increase YoY. Other markets also saw strong performance in high-inch tires with increases of 2%p in Europe and 2.9%p in Korea.
Hankook also strengthened its standing in the premium original equipment (OE) sector and electric vehicle (EV) tire sector in 2021, with the company starting to equip Porsche Panamera, BMW X3M and X4M, while fitting its EV tires on Audi e-Tron GT and Volkswagen ID.4.
In 2022, Hankook plans to further enhance its brand value. The company is aiming to achieve double-digit growth this year and to increase portion of high-inch tires sales to 42% among total sales of passenger car tires.