Hankook Tire reported year-on-year sales growth of more than 40% in its ultra-high performance (UHP) tire business, helping the company record sales of more than $1 billion for the first time in its history.
Hankook Tire reports it exceeded market expectations with global sales increasing 18.4% year-on-year. The company also recorded operating profit of 7.4% in the first quarter of 2008.
Sales within the UHP business accounted for $96.6 million. Sales to OE manufacturers also increased by 15.7% year-on-year.
In North America, first quarter sales increased 18.1% year-on-year.
“Awareness of our product in North America continues to grow, and therefore so does demand,” said Greg Pae, president of Hankook Tire America Corp. “We opened our sixth distribution warehouse in the United States in April to better serve our customers in the Midwest. We’re committed to growing our aftermarket and OE business in the States and we have long-term strategies in place to do so.”
Seung Hwa Suh, Global CEO of Hankook Tire, said, “Our long-term and consistent investments continue to strengthen our technology, and the surge in sales for our high-end products reflects our growing reputation for providing high-quality, high-performance tires. The company is in a strong position to build on this reputation, and we should continue to highlight the quality and technology behind our tires to sustain success in emerging markets, as well as continue to challenge in other more established markets.”
The company said rising supply costs continue to shape a challenging business environment for all tiremakers. Hankook Tire's cost of sales, which include investments aimed at increasing production capacity to 74 million tires by the end of 2008, increased by 21.9% to $772 million.
Suh continued, “The tire industry is fiercely competitive and it is critical that we continue to manage costs effectively, while balancing investment to ensure sustained future growth. We continue to take a long-term view. Demand for our quality products continues to outstrip supply and we are continuing to increase production in all countries where we are manufacturing.”
The company also globally introduced Kontrol Technology at Auto Beijing on April 21. Kontrol Technology is a set of technological innovations applied throughout research, development and production to ensure controlled driving experiences. The campaign, to be rolled out at different stages market-to-market, will make it easier for customers and dealers to understand the advanced technology behind the company’s tires.
