Kia's sales and share keep growing, as its local boss lays out bold new EV, crossover SUV and warranty plans for the next phase
Overall new vehicle sales continue to go backwards in Australia, but one brand that keeps bucking the trend is Kia, having doubled its sales between 2014-18 and continuing to climb so far in 2019 to boot.
The ‘second’ Korean brand after Hyundai has gone from also-ran, to fast-growing upstart, to established brand hovering around the top 5 overall position in impressively rapid time, clawing its way ahead of Volkswagen, Nissan, Honda, Holden and Subaru in the process.
This is despite lacking any light commercial vehicles (utes and vans), though this corner of the market comprises more than 20 per cent of overall sales.
Consider this: in just-announced February 2019 figures, the company sold 4856 new cars and finished sixth on the overall ladder - between Ford and Volkswagen. That’s more than double its haul from February five years ago, when it sold 2391 units. One month earlier in January 2019, it cracked the top 5 mark for the first time.
Put another way, Kia’s market share in 2019 so far sits at 5.6 per cent. It finished 2018 with an annual share of 5.1 per cent (equating to 58,815 sales). In 2014, its market share was a paltry 2.5 per cent. Thus, within five years its sales and market penetration more than doubled. And hardly off a negligibly low base like some fly-by-night brands.
Perhaps more interestingly, in this five year period between 2013 and 2018, Kia’s market share relative to its biggest stakeholder Hyundai went from being less than one-third the total (2.6 per cent share points for Kia, 8.5 for Hyundai) to being to being 62% of its big brother (5.1 per cent versus 8.2 per cent).
In 2019 so far, the gap between the two big Koreans has narrowed further, with Kia’s 5.6 per cent market share about 75 per cent of Hyundai’s tally and share totals (7.5 per cent market share). The relationship between the pair is clearly different than even the recent past.
Indeed, as this list shows, Kia’s sales have been heading in just one direction since the end of 2014, perhaps not coincidentally the same year in which former Hyundai Australia’s then-sales director Damien Meredith took the reins as Kia’s local COO, charged with the daily operations across all areas.
Kia actually sits at number one in two vehicle segments (Picanto in Micro Cars and Carnival in People Movers), and has capitalised on other brands placing less emphasis on passenger cars by reaping big sales of the Rio and Cerato, while building hype with the Stinger GT muscle car, also used as a Police Pursuit Car locally to much fanfare.
SUVs are now the dominant vehicle choice, and Kia is less well-covered here, though the Sportage (2269) is its second most popular car and the Sorento (699) is its real profit centre.
The aforementioned Meredith told CarAdvice today that the company’s goal this year was to grow once again in 2019, belying a market widely tipped to decline in the face of numerous economic headwinds, potentially luring buyers after a bargain and who are keen on Kia’s industry-topping seven-year warranty.
He said the goal was to get 5.5 per cent share, and said that plans to grow in the passenger space while adding at last one new SUV model this year (a new baby SUV to rival the Mazda CX-3) and “hopefully” a pickup by 2021/22 would theoretically see the company nudge 100,000 annual sales - currently ballpark with Hyundai, which presumably would also grow.
Kia Australia sales, and growth percentage over the preceding year:
- 2018: 58,815 units, up 7.5%
- 2017: 54,7437 units, up 28.3%
- 2016: 42,668 units, up 26.5%
- 2015: 33,736 units, up 20.5%
- 2014: 28,005 units, down 6%
Double digit growth over the course of one or two years are common enough, but growing into a fifth consecutive year (in a market that’s started to sour inside the past 12 months, notably) is something quite unusual.
Kia’s local arm isn’t laying idle this year, either, with the new B-segment small crossover (previewed here) to take the fight to the CX-3, Mitsubishi ASX and Hyundai Kona from about October/November this year.
At the same time, Kia will make its dealers’ lives easier by axing three slow-selling cars from its range by year’s end: the Optima sedan, Soul hatchback (which will not be replaced by the new version, except perhaps in EV form during 2020/21) and the Rondo people-mover all to be axed.
Beyond this, the company is expected to lob the Niro electric SUV in January 2020 at the Australian Open tennis, giving it an EV to rival the Nissan Leaf and Hyundai Kona Electric.
“I believe in EV and if we want to keep improving the brand we need to be at the cutting edge of these types of vehicles,” Meredith said.
Meredith also added that if any fellow top-selling brand introduces a permanent seven-year warranty across its range (Holden and Mitsubishi have flirted with it, while SsangYong offers it but is still a minnow), he’d push the Korean head office to allow the company here to offer a warranty of up to 10 years, like in the US.