* Q1 net profit 668 bln won vs consensus 1 trln won
* Higher domestic sales offset by sales slump in U.S., China
* GM Korea woes benefit Hyundai, imported cars
* Introduction of new SUV models to help improve results -CFO
* Hyundai shares drop almost 6 percent on disappointing results (Add CFO, analyst comments, updates share movement)
By Hyunjoo Jin
SEOUL, April 26 (Reuters) - Hyundai Motor Co’s quarterly profit halved to an almost six-year low, as bleak U.S. and China sales contrasted with those at home where the automaker is picking up customers of General Motors Co’s troubled South Korean arm.
The lacklustre results serve as a reminder of how Hyundai, which has been in the red for five years, continues to struggle due to its heavy reliance on sedan sales and slow response to rising demand for sport utility vehicles (SUVs) in China and the United States, the world’s top two auto markets.
Hyundai shares fell almost 6 percent after it reported a January-March profit of 668 billion won ($619.15 million), the weakest since the first quarter of 2012 and below 1.3 trillion won reported in the corresponding 2017 period.
The result compared with an average forecast of 1 trillion won from analysts polled by Thomson Reuters I/B/E/S.
The earnings are “very shocking, more shocking than ever”, said Ko Tae-bong, an analyst at Hi Investment & Securities.
Hyundai has sharply lowered production at its U.S. factory to cut supply of unpopular sedans like the Elantra and Sonata, leading to the first-quarter earnings slump, the analyst said.
He estimated Hyundai’s U.S. factory ran below 70 percent of its capacity, and will remain sluggish until it starts making the next-generation Santa Fe SUV by as early as May.
Hyundai has already launched the Kona SUV in the United States, its third-biggest market after China and South Korea, but that has not been able to offset the slack in sedan sales.
The introduction of new SUV models like the Santa Fe in overseas markets should help improve earnings going forward, Hyundai CFO Choi Byung-chul said on an earnings call.
He said Hyundai would be able to achieve its sales target of 4.68 million vehicles this year.
Hyundai and affiliate Kia Motors, together the world’s No.5 automaker, have missed their global sales target for the past three years.
For the three months ended March, Hyundai posted sales of 22.44 trillion won, down 4 percent from a year ago, led by a 15 percent drop in China and a 12 percent slide in the U.S. market.
Its domestic sales, however, rose 5 percent as uncertainty stemming from GM’s plan to slash production and restructure its loss-making South Korean operations prompted customers to switch to Hyundai and imported German vehicles.
GM Korea’s share of the South Korean market halved to 4.7 percent over the first three months versus 2014 levels, while Hyundai and Kia saw their combined share rise to 69 percent - the highest since 2014, according to government data.
Hyundai shares ended down 4.6 percent on Thursday, lagging the broader market that ended up 1.1 percent.
The shares are, however, still up around 9 percent for the month, supported by Hyundai’s parent’s plans to streamline a complex ownership structure.
Activist hedge fund Elliott, which holds over $1 billion worth of shares in three key affiliates of Hyundai Motor Group, has dismissed the restructuring plan as insufficient, calling on the conglomerate to adopt a holding company strategy, boost shareholder returns and appoint more independent board members.
CFO Choi said Hyundai Motor Co would make continuous efforts to bring its dividend payout ratio to levels offered by global peers.
$1 = 1,078.9000 won Reporting by Hyunjoo Jin; Editing by Himani Sarkar