Kia's Q3 Operating Profit Plummets by Half, Sharp Decline Year-Over-Year
Kia's Q3 Operating Profit Takes a Dive, Despite Record Revenue
Kia announced on October 31, 2025, that its operating profit for the third quarter fell by 49.2% compared to the same period last year. This decline is attributed to a combination of factors, including the global economic slowdown, intensifying competition across the automotive industry, and rising raw material prices. Notably, the sluggish sales of traditional internal combustion engine vehicles amidst the rapid growth of the electric vehicle (EV) market significantly impacted profitability. Kia stated its intention to continue expanding investment and R&D to secure its position in the future mobility market, even amidst this challenging business environment. However, the lack of specific details regarding profitability improvement measures has left some market concerns unaddressed. Experts suggest that strengthening its EV lineup, developing high-value-added vehicle models, and establishing an efficient cost management system are crucial for Kia to secure long-term growth drivers. A proactive response strategy to global supply chain instability is also deemed an urgent task. Kia's Q3 operating profit decline reflects the rising sense of crisis across the domestic automotive industry, prompting calls for government support policies.
Despite the profit slump, Kia recorded revenue of ₩28.6861 trillion in the third quarter, marking an all-time high. This achievement is attributed to strong sales of SUVs and high-end vehicles, along with favorable exchange rate effects. In particular, steady growth in the North American market and increased EV sales in the European market significantly contributed to revenue growth. Kia stated its intention to expand investments to strengthen its competitiveness in the future mobility market, leveraging this revenue growth, and to continuously pursue efforts to improve profitability. However, given the significant decline in operating profit, some argue that revenue growth alone is insufficient to fully offset the poor performance. Experts emphasize that Kia needs to focus more on developing high-value-added vehicle models and enhancing brand image, rather than simply increasing sales volume, to achieve sustainable growth. They also advise proactive investment in securing next-generation battery technology and expanding charging infrastructure in preparation for intensifying competition in the EV market. While Kia's revenue increase is a positive sign, it highlights the need for multifaceted efforts to address the challenge of declining operating profit.
Meanwhile, the automotive industry is divided on whether Kia's poor performance is a temporary phenomenon or a structural problem. Some believe that external factors, such as the global economic slowdown and rising raw material prices, played a significant role, while others point to Kia's weakening competitiveness and lack of innovation as the root cause. In particular, sluggish performance in the Chinese market and delayed competitiveness in the EV market are cited as problems. Kia stated its intention to address these issues by establishing a customized strategy for the Chinese market and accelerating the expansion of its EV lineup and strengthening its technological competitiveness. However, forecasts suggest a difficult battle ahead due to intensifying competition in the Chinese market and the expanded entry of global automakers into the EV market. Experts emphasize that bold innovation and differentiated competitiveness are essential for Kia's long-term survival. They also expect government deregulation and support policies to play an important role in strengthening Kia's competitiveness. Kia's poor performance is raising awareness across the domestic automotive industry and is expected to further accelerate the competition for innovation for survival.
In this context, the news that Lee Jae-yong, Chairman of Samsung Electronics, Chung Euisun, Chairman of Hyundai Motor Group, and Jensen Huang, CEO of NVIDIA, held a meeting at a fried chicken restaurant in Samseong-dong, Gangnam-gu, Seoul on the 30th is noteworthy. This suggests the possibility of cooperation in artificial intelligence (AI) semiconductors, a core technology for the future mobility industry, and is expected to have a positive impact on the domestic automotive industry as a whole, including Kia. In particular, NVIDIA's AI semiconductor technology is essential for the development of future mobility technologies such as autonomous vehicles and connected cars, and synergy effects are expected to be created through cooperation with Samsung Electronics and Hyundai Motor Group. However, the lack of specific details regarding the content and timing of cooperation suggests the need for further observation. Experts assess that this meeting has more meaning than a simple dinner and could be an important opportunity to change the landscape of the future mobility industry. They also emphasize that the government should actively support cooperation between these private companies and strive to create an ecosystem for the future mobility industry. It remains to be seen whether the meeting between Chairman Lee Jae-yong, Chairman Chung Euisun, and CEO Jensen Huang will become a harbinger of a bright future for the domestic automotive industry.
