Kia Motors posts double-digit fall in Q3 profit on labor strikes

Kia Motors, South Korea's second-largest automaker, recorded a double-digit decline in its third-quarter profit as labor strikes disrupted production and sales, the company said on Thursday.

Operating profit was 524.8 billion won (461 million U.S. dollars) in the July-September quarter, down 22.5 percent from a year earlier.

The company said in a statement that fixed costs increased on partial strikes by unionized workers amid the local currency's appreciation versus the greenback.

Revenue fell 3.1 percent over the year to 12.7 trillion won in the September quarter, but net income expanded 20.8 percent to 664.3 billion won.

Labor strikes disrupted production in domestic factories, which declined 14.6 percent in the quarter compared with a year earlier, but production in overseas plants jumped 30.3 percent thanks to the launch of a new plant in Mexico.

Kia's global car sales increased 3.9 percent from a year earlier to reach 684,302 units in the third quarter thanks to higher sales in cars produced in overseas factories.

For the first nine months of this year, revenue increased 8.4 percent to 39.8 trillion won compared with the same period of last year. Operating profit rose 4.9 percent to 1.92 trillion won, and net income advanced 10.7 percent to 2.43 trillion won.

The company affiliated with top South Korean carmaker Hyundai Motor said its unionized workers downed tools 22 times this year, disrupting production of about 90,000 vehicles worth about 1.9 trillion won. Enditem