Hankook's profit soared in 2024, with an increase of more than 30%!
Recently, South Korean tire manufacturer Hankook Tire announced its performance in 2024 - sales increased and profits increased significantly!
In 2024, Hankook Tire's revenue reached 9.41 trillion won (47.3 billion yuan), an increase of 5.3% over 2023, and operating profit was 1.76 trillion won (8.865 billion yuan), an increase of 32.7% over 2023; the operating profit margin reached 18.7%.
Large-size tires boost performance
Hankook Tire's large-size tire sales layout that it has adhered to for many years will continue to contribute to its overall revenue in 2024.
In 2024, Hankook Tire's sales proportion of 18-inch tires rose to 46.5%, a year-on-year increase of 2.3%.
This also explains why Hankook can achieve a big step-by-step growth in profits in 2024. The high profit margin of high-value tires not only helps Hankook's high profit growth, but also fully guarantees Hankook's long-term development.
Especially in the Chinese tire market, Hankook's large-size tire sales performed particularly well. In the fourth quarter of 2024, Hankook's sales of 18-inch and above tires accounted for 69.3% in the Chinese market, 7.5% higher than the same period in 2023, and performed best in its major global markets. It can be understood that about 70% of Hankook's products sold in China are large-size high-value tires.
In the first four quarters, Hankook's large-size tire sales in the Chinese market accounted for an average of 65%; the sales of large-size tires of 18 inches and above in the Korean domestic market accounted for an average of about 57%; the North American market was about 55%; and the European market was about 37%.
It can be seen that in the Asian market, Hankook's large-size tires are relatively hot, and the North American market has also made a strong breakthrough, which is about 9 percentage points higher than the average (the sales of large-size tires in the North American market in the fourth quarter of 2024 increased by 3.5% year-on-year), and the European market still has potential for growth.
It is worth noting that although Hankook needs to continue to strengthen large-size tire sales in Europe, the overall sales of tires in Europe are very good. Even Hankook Tire's "rapid progress" in the European tire market has become an important support for its sales and profit growth in 2024.
European sales are on the rise
In 2024, Hankook's sales in Europe soared, with annual sales reaching 3.88 trillion won (about 19.5 billion yuan), accounting for 41% of its total sales, and is the most important part of Hankook's sales in 2024.
In the third and fourth quarters, Hankook's European sales broke through the trillion mark one after another. Hankook said that many European countries introduced strict winter tire-related regulations in 2024, resulting in increased demand for winter tires and all-season tires, bringing more opportunities for Hankook's sales in the European replacement market. However, Hankook also mentioned that due to the EU's tariffs on Chinese electric vehicles, the sales of electric vehicles in Europe have declined, affecting the growth of its supporting sales.
Overall, Hankook Tire has achieved growth in the "full track" of the European replacement tire market, helping its sales to hit a record high in Europe.
In the supporting market, although the EU has imposed tariffs on Chinese electric vehicles, the increase in overall European automobile production still brings more orders to Hankook's supporting business.
Outlook for 2025
The growth in performance has brought more confidence to Hankook Tire. In its financial report, it mentioned that in 2025, Hankook will continue to increase its large-size sales share and strive to achieve quantitative and qualitative growth by expanding its 18-inch and above tires and electric vehicle-specific tire product portfolio.
In addition, Hankook will continue to expand production capacity as planned to ensure sustainable growth while maintaining a solid financial foundation.
Specifically, the sales proportion of large-size tires will exceed 50% in 2025-aiming to improve competitiveness by promoting sales of high-value-added strategic products and strengthening the high-end brand image. The proportion of electric vehicle tire supporting business strives to reach 29% in 2025.
Hankook's goal in the electric vehicle tire business in 2025 is to lead the high-end tire market through the "iON" tire dedicated to electric vehicles. In terms of production capacity, Hankook will continue to expand its factories in the United States and Hungary as planned, and the overall performance of the channel group will grow sustainably in the long term.
According to its financial report, the expansion project of Hankook's Hungarian plant is expected to start production in mid-2026 and be fully operational in 2027, when the plant can produce about 2,380 truck tires per day.
The expansion scale of the Tennessee plant in the United States is to add 16,000 passenger car and truck tires per day, and 3,000 truck tires per day; in the second half of this year, it will enter the trial operation stage of the expansion project and be fully operational in 2026.
