Kia ramping up production in China with additional factories
Kia have taken the world auto market by storm over the past 24 months, gone are the odd, quirky designs that were only able to rival second hand cars and in are sleak, slender designs that are enough to make the Bavarian’s blush and the Japanese worry themselves to sleep at night. Kia’s unique selling point for the longest time was that they are cheap and cute, but the average buyer with 15,000USD in their pocket would probably jump for the second hand BMW rather than the new Kia Rio, but that’s changing. Kia have proven their worth with the new Kia Sportage (SportageR in China) and the new K2 compact and K5 mid size sedan, Chinese consumers are also waking up to Kia’s new found confidence – Kia’s 2010 sales were up by 38% at 330,000 vehicles in China.
Reuters reports:
South Korea’s Kia Motors said on Wednesday that its Chinese joint venture plans to build its third vehicle manufacturing facility in China by 2014, producing cars targeted at the world’s top auto market.
The new facility with an annual capacity of 300,000 vehicles will bring Kia’s total capacity in China to 730,000 vehicles and is aimed at “meeting dramatically increasing local demand and maintaining positive sales momentum in the Chinese market,” Kia said in a statement.
Shares in Kia were up 1.1 percent versus the wider market’s ‘s 1.6 percent fall as of 0239 GMT.
Kia, an affiliate of Hyundai Motors , makes cars in China in a tie-up with Dongfeng Motor Group Co Ltd and Jiangsu Yueda Investment Co Ltd .
Kia and Hyundai have been among the best performing foreign brands in China in recent years, posting record-high monthly sales in September on strong demand for Hyundai’s new Sonata sedan and Kia’s new K2 (Rio) subcompact.
Hyundai-Kia expects to reach sales of around 1.15 million vehicles in China this year, placing it third in the market behind Volkswagen and General Motors .
On Wednesday, Dongfeng Yueda Kia (DYK) Motors and the local government signed a memorandum of understanding on the new plant in Yancheng, Jiangsu Province.
Kia said the plant would produce “strategic models developed especially for the Chinese market.”
Hyundai Motor also plans to start production at its third China plant next year, bringing its total annual capacity to 1 million units.
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I saw a new Kia K5 today, looked pretty slick.
It’s still a Kia, in my eyes… but it’s a Kia in the right direction!
Same here – love the new K5, it looks brilliant, but its still a Kia and somehow not ‘worthy’ of another look. Put a Merc badge on it and I would have bought one already.
@ Ash
> its still a Kia and somehow not ‘worthy’ of another look.
Kinda shows you how out of touch with reality you are after being stuck in China for so many years. Kia is a killer brand now in the US.
US October 2011 Auto Sales
http://www.freep.com/article/20111102/BUSINESS01/111020409/1014
I usually delete your comments on sight, but I think you have raise a good point for once, albeit indirectly.
Kia for the longest time were only able to compete with the second hand car market, their brand was the butt of all jokes, but now they are coming around with decent cars. It’s taken them 15-20 years to get this far, how many more years will it take for the brand to become valued? This is lesson that Chinese car manufacturers are going to have to learn at some point, you cannot experiment with consumers as you learn how to make cars, this has been Kia+Hyundai’s drawback for far too long, when they enter Western markets they have to enter with world class cars and not China market cars that have been slightly remodeled for Western tastes.
Congratulations to Kia, their Oct US sales show a 20%+ difference, so does Hyundai, I wouldn’t over exaggerate and call them a killer brand yet but they have certainly turned a corner. They are breaking out of the molds and bringing exciting new designs to the market, the Big 3 plus the Japanese Big 3 seem to have lost the design plot in some respects, plus Hyundai Kia’s engine technology is getting better and better.
The only reason they are doing so well is they don’t look like garbage anymore and they are cheap. You get more in them than any other car for the same price. It doesn’t mean they drive better or are any better than anything else. I have two family members that recently bought Hyundai and Kia. The only reason was the price. They can dominate lower priced vehicles with lower price and more features inside the car all day long. They are still going to need another 10-15 years to get into higher priced cars if that is a direction they want to pursue. It seems Hyundai wants to give it a go anyway.
I’d wager It’s doing well because the US has been heading/in recession for a few years and people are broke, so they buy cheaper stuff. It’s not doing well because they make superior vehicles, but perhaps hit the recession-ready “value-shopper” demographic.
I don’t find it strange at all. I can’t comment on the US as I haven’t been there in years. In Europe however Kia is a second class brand which needs to use a long warranty to win over customers.
I actually think Kia has a much better reputation in China than in Europe. Chinese people respect Korean engineering.
The warranty in US is also very long. Longer than any other brand. Most people buy he car thinking they will have warranty on it until they sell it. So it will never be there problem financially even if it does have problems.