Morgan Stanley reported that Kia delivered month-over-month strength in March, recording a 2.7% increase in global volumes year-over-year, while Hyundai Motor posted a 2.3% decline for the same month.
The contrast between the two South Korean automakers was most pronounced in the domestic market. Kia’s sales inside South Korea rose 12.8% year-over-year in March, a performance that notably exceeded Hyundai’s 2.0% fall in domestic volumes. Morgan Stanley attributed Kia’s domestic improvement in part to the arrival of new models including the PV5, EV4 and EV5, and highlighted a 149% year-over-year jump in battery electric vehicle sales for Kia.
On overseas deliveries, Kia eked out a small gain of 0.4% in March while Hyundai’s international volumes slipped 2.4%. Both brands experienced soft demand in the United States, according to Morgan Stanley, but Kia’s overall monthly result was assisted by stronger sales in India and Europe.
Looking at the first quarter of 2026, Morgan Stanley’s figures show Hyundai finished with volume down 2.6% year-over-year, while Kia posted modest growth of 0.8% versus the prior year. Both quarterly outcomes fall short of the automakers’ stated annual guidance: Hyundai had targeted 0.5% growth, and Kia had a target of 6.8% growth for the full year.
The data underline a divergence in near-term performance between the two groups, with Kia’s gains concentrated in its domestic market and supported by new models and electric vehicle sales, and Hyundai contending with weaker volumes across several markets including the United States. While the quarterly numbers show Kia ahead on year-to-date volume growth, both companies remain below the growth trajectories they set out for the year.
Summary
Kia outperformed Hyundai in March with 2.7% year-over-year volume growth versus Hyundai’s 2.3% decline. Kia’s domestic market drove the outperformance, with a 12.8% increase and a 149% surge in battery electric vehicle sales. Overseas, Kia was flat to slightly positive, while Hyundai declined. Through Q1 2026, Kia’s volumes were up 0.8% year-over-year and Hyundai’s were down 2.6%, both missing their annual guidance targets of 6.8% and 0.5% respectively.
Key Points
- Kia recorded 2.7% year-over-year volume growth in March, supported by domestic demand and new model introductions.
- Hyundai Motor’s March volumes fell 2.3% year-over-year, with continued weakness in the U.S. market.
- For Q1 2026, Kia posted 0.8% growth year-over-year and Hyundai was down 2.6%; both missed their annual guidance targets (Kia 6.8%, Hyundai 0.5%).
Risks and Uncertainties
- Weak demand in the United States is cited for both automakers and could continue to weigh on overseas volumes.
- Both companies' first-quarter volumes are trailing their annual guidance targets, introducing uncertainty around meeting full-year goals.
- Kia’s March strength was concentrated in the domestic market and driven by specific new models and BEV sales, which could leave results sensitive to shifts in those segments and markets.
Data source: Morgan Stanley (monthly and first-quarter volume comparisons year-over-year).