News - Kia
Kia ready to roll with pick-up for Australia
Plans for Kia’s pick-up well advanced, but still needs head office approval
7 May 2018
By TIM ROBSON
KIA Motors Australia (KMAu) stands ready to roll out new dealers in regional areas in a bid to chase a ten per cent share of the Australian light-commercial pick-up market.
With recently appointed president and CEO Woong ‘Ben’ Hur supporting the bid, KMAu chief operating officer Damien Meredith told GoAuto that the company recently presented an advanced strategy plan to its South Korean head office, detailing its strategy for a 4x2 and 4x4 program that could add up to 20,000 utes to the company’s bottom line locally.
“The two biggest pick-up markets in the world are North America and Australia, and I think a lot of senior management from Korea were surprised how big the actual market is in Australia,” Mr Meredith said at the launch of the facelifted Carnival people-mover in New South Wales last week.
“They were probably taken aback a little by our confidence in the volume that we could do.
“Specifically, we'd like to take 10 per cent of that market.”
As GoAuto has reported, if this goal is achieved, it would push KMAu – which sold 54,737 vehicles in 2017 – towards a spot in the top five car companies by volume.
Mr Meredith said that KMAu made a comprehensive presentation in a marathon meeting to Kia Motor Company (KMC) Global Operations Division executive vice-president and chief operations officer, Ho Sung Song, while the company’s highest ranking official was in Australia recently.
“He graciously wrote back to me but straight away saying, ‘Thanks very much for all the information, you guys did a great job on the presentation and we understand fully the urgency of that type of vehicle in the Australian market’,” said Mr Meredith.
“It’s very rare that you get the global head out to Australia and we took the opportunity to lay our cards on the table, but we think that this is a golden opportunity for us as a brand.”
Mr Meredith also confirmed plans to bolster regional support once the green light is given for a commercial program.
“We’ve got a plan ready to put into place once we get the go ahead with it,” he said. “We would put another level of provincial dealers into place around Australia.”
He acknowledged that discussions have been ongoing with KMC for several years, and the key issue is still finding sufficient plant capacity to produce a new commercial line.
“We’ve been very vocal obviously with KMC, and they are well aware of the market opportunity, not just here but in other markets that are (asking for) vehicles like HiLux and Ranger et cetera,” he said. “I think at this stage it is still to be confirmed. The struggle at the moment is where to produce it.”
While the majority of Australian-market utes are supplied from Thailand, there would be no disadvantage in supplying them from South Korea, which also shares a free-trade agreement with Australia.
“Every plant at the moment is at pretty much maximum capacity. Where to find another plant that is going to find you another 50,000 to 100,000 cars (globally) is a challenge,” said KMAu general manager of product planning, Roland Rivero, who believes that the popularity of the pick-up is set to continue.
“I have been watching pick-ups for over ten years now and it doesn't matter what conditions come, whether it be a global financial crisis, be a drought, they just keep churning them out,” he said. “It hasn't shown any signs of slowing down yet and I don't see them slowing down.”
Mr Meredith indicated that a pick-up model line would encompass a full range of vehicles from 4x2 cab-chassis to highly specified 4x4 dual-cabs.
“I like to think that we don’t compromise in KMAu,” he said. “We’ve got to make sure that we’ve got the right varied mix and the right model line-up to fulfil the Australian demand.
“We make sure that if we are going to bring a car to market, we bring it so that it’s highly competitive amongst its competitive set and it puts us in the best position to hit our sales aspirations,” he said. “I think we would probably be impactful straight away in that area.
“We are not an over-confident organisation we’re a confident organisation that likes to fly below the radar, but we think we could probably do that.”
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