Nexen results hit by "weak" North America despite record revenue

Seoul – Nexen Tire Corp. saw its profitability decline due to weak sales in North America, despite registering a record revenue for 2024.

The Korean tire maker posted sales of KRW2,840 billion (€1.9 billion) for the full year, up 5.4% compared to 2023, Nexen reported on 7 Feb.

Operating profit, however, fell nearly 8% year-on-year to KRW172 billion (previously million—likely a typo), due to weak sales in North America, as well as downstream distribution costs such as logistics and warehousing.

Sales performance during the year was "solid" in Europe, with revenue in the region up 13% at KRW1,230 billion, accounting for 40% of overall sales.

Here, the OE market achieved growth by “securing stable supply volumes and optimising the portfolio,” despite slowing market demand.

Replacement sales grew for large tires and premium products.

In North America, revenue fell 5.4% year-on-year to KRW682 billion, with the final quarter seeing a slump in OE due to lower new car sales and the impact of a distribution network restructuring.

Overall, during 2024, Nexen’s OE sales outperformed replacement sales, which declined in the second half due to the financial difficulties of a major customer.

In Korea, sales increased 2.2% compared to 2023, reaching KRW463 billion, accounting for 16% of overall sales.

The tire maker increased OE supply to register “the largest number of EV models in the domestic market,” with replacement sales strengthening through new channel diversification initiatives.

Overall, Nexen said OE sales fell 1.5% year-on-year, mainly due to lower demand in the second half, particularly in the EU.

Replacement demand, however, grew 3% over 2023, driven by increased sales of winter and all-weather tires in Europe.

Nexen expects a similar growth rate in 2025, “amid slowing global consumer spending and widespread protectionism.”