Hyundai Motor Co. will turn its focus to luxury models, SUVs and electric vehicles (EVs) to achieve record-high earnings this year, the automaker noted in its quarterly earnings report. 

The South Korean automaker reported operating profit for the three months through September at $1.07 billion, below the 2.7 trillion won average estimate from analysts tracked by Bloomberg. Sales rose 31% from 2021 to 37.7 trillion won, up slightly from the 35.3 trillion won forecast. 

Hyundai’s shares fell 3.3% to 3.8% with the news and are on track for their lowest close in more than two years.  

Hyundai has trimmed the 2022 sales target to 4.01 million vehicles from 4.32 million, and also lowered its planned investment for the year to 8.9 trillion won from 9.2 trillion won. 

Hyundai told investors it will focus on sales recovery through a plan that will “enhance its product mix with SUVs and luxury models.”  

Hyundai’s third-quarter operating profit fell 3.4% from 2021, while net income dropped 5.1%. But, excluding provisions, operating profit topped 2.9 trillion won, the company reported.

Hyundai and affiliate Kia Corp. reported they would book a combined 2.9 trillion won as provisions in third-quarter earnings due to costs related to Theta engines. The automakers reported higher numbers of owners than expected demanded replacement engines during the pandemic versus buying new cars, which drove up warranty costs. 

Hyundai is down about 22% overall this year.

EV sales remain a bright spot for the company, which reported EV sales rose more than 27% to about 52,000 units, accounting for 5.1% of overall sales volume, in the third quarter.

The automaker raised its EV sales target for 2023 by 40% to around 300,000 units, with the Ioniq 6 expected to comprise 20% of 2023 sales.

Hyundai also reported plans to invest in a joint venture to make batteries in the U.S.