News - Kia
Kia aims to shrink gap with Hyundai
Refreshed line-up will help boost local sales to 50,000 in five years, says Kia
9 Jun 2015
KIA has grand plans to significantly expand its presence in Australia, relying on a fresh new model line-up that it believes will boost annual sales to 31,000 this year – and on to 50,000 by 2020.
The South Korean car-maker is working to close the gap between it and sister company Hyundai, achieving a balance between the two brands seen in other parts of the world, where it manages to sell three cars for every five Hyundais.
The current split in Australia sits at about 70:30 in favour of Hyundai.
With the rising popularity of the Cerato small-car range and continually strong sales for the Sportage mid-size SUV, Kia is already turning the tide from previous years when the balance was closer to 75:25.
And the car-maker says the trend is likely to continue.
Speaking at the launch of the third-generation Sorento large SUV in Queensland last week, Kia Motors Australia (KMAu) chief operating officer Damien Meredith said that while the company had aggressive expansion plans, growth would not come at the cost of Hyundai sales.
“From a group point of view, it’s very important that Hyundai remains strong and we grow, but 60:40, that’s where we would like to get to,” he said. “If they are doing 100,000 we would like to be 60,000.
“That’s a long way off, there’s no question about that, but this time last year we were 28 per cent of Hyundai sales and last month we were 34 per cent, so we’ re climbing up.” Mr Meredith explained that Hyundai’s significant lead was attributable to key products and critical decisions made during the global financial crisis.
However, he is confident that Kia’s upcoming models will almost double sales by 2020, taking it to a point where it is a permanent fixture on the top-10 sales list and holding around five per cent of the entire market – the point where Nissan, Mitsubishi and Volkswagen are now.
“I think that growth was based on two products – i30 and iLoad – and it was GFC time and Hyundai made a lot of good decisions with regards to product and pricing strategy and that growth happened very quickly,” he said.
“We’ve got to be a little bit different to what Hyundai did and we have to focus on what we believe Kia means to the market and to the customer – great product, tuned for Australian conditions and great value.
“We would like to be at the 50,000 mark in about five years’ time.” While sales of the Korean brand have slipped slightly from a peak of about 30,000 in 2012, the company is enjoying an upward trend from five years ago when it recorded 23,848 new registrations.
In addition to the strengthening Cerato, over the next 12 months Kia will bolster its line-up with a succession of new offerings to tempt more Australian customers to the brand.
Kia has modest ambitions for the freshly launched Sorento large SUV, with a predicted 10 per cent increase for the third-generation version, with greater volume expectations resting on the redesigned version of the smaller Sportage, which is due for release in Australia in January next year after debuting at the Frankfurt motor show in September.
The company has all but confirmed the addition of its Picanto micro-hatch to further enhance the local range and give Kia a competitor for the likes of the Suzuki Celerio, Nissan Micra and Fiat 500.
“You will have a final decision on Picanto in July,” said Mr Meredith. “We would like to have it in the marketplace very late this year or very early next year.” A refreshed and sportier Optima mid-sizer is arriving in November this year, bringing with it a new 2.0-litre turbocharged petrol option aimed at more enthusiastic drivers, but the range could be boosted further with a wagon version which is still under consideration.
In a setback for the brand, the Pro_cee’d GT will not be getting a dual-clutch automatic transmission to help boost its appeal, with the three-door hot hatchback to push on as a manual-only proposition for the foreseeable future.
In other global regions the hottest GT variant is sold alongside less performance-focused Cee’d models, and while there are no plans to bring the full range here, KMAu senior product manager Jeff Shafer said the door had not yet closed.
“Our main focus is on Cerato and that’s been a really consistent focus for us over the last six or eight months and I think that’s showing now in the fact it’ s making some moves in the marketplace,” he said.
“That’s the car that we really want to make work. Having said that, Pro_cee’d still gets good press and we are really proud of what it represents and I wouldn’t say never.” Kia’s best seller so far this year is the Cerato, which has risen 54.9 per cent to 4082 registrations. This puts it ahead of big names such as the Ford Focus, Nissan Pulsar, Mitsubishi Lancer, Honda Civic and Subaru Impreza, but well behind the mechanically related Hyundai i30 which has found 10,280 homes over the same period.
In the light-car segment, the Rio continues to attract healthy numbers with 2396 sold so far this year, but despite a minor mid-life update arriving back in January, Kia’s baby is down 28.2 per cent as it faces competition from newer rivals including the Mazda2 and Honda Jazz.
The Rio is once again trumped by its Hyundai counterpart, the i20, which has more than doubled the Kia’s result with 6100 shifted this year.
In the SUV stakes, Hyundai’s ever-popular ix35 has found 7620 homes this year compared with the 3247 Sportages that were sold during the same period, but the soon-to-be-replaced Kia is up by 20.9 per cent year to date.
The Sportage sits in the sub-$60,000 mid-size SUV category according to official VFACTS sales figures, while the ix35 is the best seller in the sub-$40,000 small SUV segment, however when the larger Tucson arrives to replace the ix35 later this year it will compete in the same segment as the Kia.
Following the launch of the all-new version earlier this year, the Carnival has rebounded by 34.8 per cent in 2015 and at 1085 sales is now sitting just 17 units behind the segment-leading Honda Odyssey in the sub-$60,000 people-mover segment.
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