SEOUL - Hyundai Motor Co. posted on Wednesday its poorest sales in six months, as demand weakened in the summer vacation period, but it fared better than smaller rivals after introducing an upgraded car in its domestic market, reported Reuters.

South Korea's Hyundai, the world's No.5 automaker along with its affiliate Kia Motor Corp., said August sales rose 17 percent from a year earlier but fell 2.2 percent from July to 288,313 units, the lowest since February.

Its local sales inched up 0.6 percent after it unveiled a new, upgraded Elantra compact last month.

"Competition in the domestic market remains tough and we plan to further upgrade ageing models and boost marketing to revive weak domestic sales," Hyundai said in a statement.

Sales in overseas markets dropped 2.8 percent from July to 238,951 vehicles but rose 20 percent from a year ago, thanks to increased demand from China and the United States.

Hyundai said sales in the United States jumped more than 18 percent, helped by a new Sonata sedan, which accounted for nearly half of Hyundai's U.S. sales this year and helped it grow its market share there to a record 4.6 percent this year.

But U.S. safety regulators have opened a preliminary investigation into claims that Sonata, Hyundai's best-selling car in America, may have steering problems, government officials said on Tuesday.

Kia Motors, Korea's second-largest automaker, saw its sales slump 16 percent in August from a record in July and hit a 6-month low, affected by weak seasonality.

Ssangyong Motor Co., which is in bankruptcy protection and signed a preliminary acquisition deal with India's Mahindra & Mahindra Ltd. in August, said sales more than tripled from a year ago as it remained on a firm recovery track. But vehicle sales edged down 11 percent from the previous month.

Shares in Hyundai Motor finished up 1.8 percent and Kia shares jumped 3.6 percent after it reached a tentative agreement with its labor union on a wage deal, which will help it avoid annual labor strikes for the first time in two decades.