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SEOUL, June 2 (Reuters) - Vehicle sales in China for Hyundai Motor, South Korea's biggest car maker, fell 65 percent in May, following political tensions between the two Asian countries over the deployment of a United States missile system.
The result follows reports that competitors are outpacing the South Korean company, with Honda Motor Co Ltd and Geely-owned Volvo Car Group reporting double-digit sales gains in China last month.
Hyundai's China factory sales fell to 35,100 vehicles in May from 100,328 a year earlier, dropping for a third consecutive month, Samsung Securities analyst Esther Yim said on Friday, citing company data.
The persistent weakness in their top market puts Hyundai, and its affiliated brand Kia Motors, on track to miss their global sales target for a third consecutive year in 2017, analysts say.
A Hyundai spokeswoman said the company does not officially release China sales data and could not confirm the figure provided by Yim.
South Korea angered Beijing by deciding to deploy a U.S. missile defence system to counter threats from North Korea, resulting in backlash against Korean goods such as automobiles. China says the system's powerful radar can penetrate deep into its territory and undermine its security.
The political tension has compounded Hyundai and Kia's problems of a lack of a sport utility vehicle line to sell in China and weak brand perception in the country, which pulled down their China market share to an eight-year-low last year.
The election of new South Korean President Moon Jae-in was expected to help mend ties with China, but businesses say there is no evidence ties have improved yet.
Yim said on Friday that Hyundai's sales are expected to remain depressed until the fourth quarter of this year, when the company plans to launch a redesigned ix35 SUV, which is expected to be 10,000 yuan ($1,467) to 20,000 yuan cheaper than its predecessor.
Hyundai Motor shares ended down 1.5 percent while Korea's Kospi index gained 1.2 percent on Friday.
$1 = 6.8162 Chinese yuan renminbi Reporting by Hyunjoo Jin; Editing by Michael Perry and Christian Schmollinger