Hankook Tire, the seventh largest and one of the fastest growing tire manufacturers in the world, announced second quarter year-on-year sales growth of 67% in its ultra-high performance (UHP) tire business, helping return strong global sales growth of 27.5% year-on-year and 11.5% quarter-on-quarter.

US$1.09 billion in sales was recorded for the period with an operating profit margin of 7.1%. As well as the ongoing and strong demand for Hankook Tire’s high-end tire technology, high revenue was boosted in part due to a weakened Korean won and an increase in the price of tires. The tire industry is facing increased pressure from a 24.3% year-on-year raw material cost increase (the cost of natural rubber alone increased by 40.5% year-on-year). This is putting pressure on all tire makers to increase their prices with more than 50% of the cost of tire production based on raw material costs.

Mr. Seung Hwa Suh, Global CEO of Hankook Tire, said, “The tire industry continues to be fiercely competitive and rising oil prices are also affecting consumers’ purchasing intentions and decisions throughout the world. The industry is closing in on a significant cross-road where leading next-generation tire manufacturers, like Hankook Tire, with increasing reputations for quality and technology coupled with relatively more affordable prices have an opportunity to continue to gain further market share.”

In spite of these challenging market conditions, year-on-year sales performance for Hankook Tire remains strong throughout key regions and within key business units and were not affected by price increases made in the second quarter. Thanks to a consistent focus on quality and fostering stronger ties with retail channels, sales within the UHP business accounted for US$114.2 million, increasing by 67% (UHP tire exports from Korea increased by 48.5%).