Kia aims to lift EV sales after record profit
KIA wants to increase sales of electric vehicles (EVs) so they account for 9 per cent of revenue by the end of the year, up from 5.5 per cent last quarter.
Kia is part of Hyundai Motor, which this month committed to spending about 24 trillion won (S$24 billion) to lift production of EVs to 1.5 million a year by 2030. Hyundai has set itself a goal of being one of the world’s top three EV makers, with 31 models across its brands by the end of the decade.
Kia executive vice-president Woo Jeong Joo mentioned the 9 per cent revenue target in an earnings call Wednesday (Apr 26) after the automaker said its operating profit for the quarter till March jumped 79 per cent from a year earlier to 2.9 trillion won, beating analysts’ estimates.
Revenue rose 29 per cent to 23.7 trillion won and Kia’s operating margin was 12 per cent.
Easing chip shortages and the popularity of models such as sport utility vehicles (SUVs) in the US spurred growth, Joo said. The company is maintaining “strong control” over incentives to dealers to lower costs, he added.
Kia’s average US incentive spending was 52 per cent lower than the first quarter last year, Bloomberg Intelligence said, citing TrueCar.
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“Dealers in US are favouring our cars,” Joo said. “We are trying to get the right prices.”
Kia’s US sales jumped about 22 per cent from a year earlier to 184,000 vehicles, while in India and Western Europe they rose 24 per cent and 2 per cent, respectively. China sales plunged 38 per cent and Russia sank 67 per cent. Kia sold 768,251 cars in total globally.
“Despite weak global economies, its Sportage SUV has stoked US demand while the Sonet SUV and Carens MPV boosted sales in India,” Bloomberg Intelligence analyst Steve Man wrote in a note.
Kia said it is seeking to increase EV sales in China – the world’s biggest car market – to 20 per cent of revenue in the country by 2025. The EVs will be produced at its plant in Yancheng. BLOOMBERG
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