Kia's New Challenge in China with the Sportage

Launch in Q4... Annual sales of 52,000 units
China's sales decline every year... Plans to increase sales after electric vehicle launch next year

[Asia Economy Reporter Yoo Hyun-seok] Kia aims for a turnaround in the Chinese market with its Sportage sports utility vehicle (SUV). This is to counter the continuous decline in sales over the years. In particular, next year, Kia plans to introduce one electric vehicle model to continuously boost sales.

According to the completed car industry on the 28th, Kia is scheduled to launch the new Sportage SUV in the Chinese market next month.

They also announced sales targets. The plan is to sell 52,000 units annually in China based on domestic sales. This includes 39,000 internal combustion engine vehicles and 13,000 hybrids.

The new Sportage is the first model released after the Chinese subsidiary was rebranded from 'Dongfeng Yueda Kia' to 'Kia Motors Co., Ltd.' in March. When Kia first entered the Chinese market in 2002, it established a joint venture called 'Dongfeng Yueda Kia.' It was a three-party structure with Kia holding 50%, Dongfeng Motor 25%, and Jiangsu Yueda Group 25%. However, this year, Jiangsu Yueda Group, a state-owned enterprise owned by Yancheng City, completed the acquisition of Dongfeng Motor's 25% stake in Dongfeng Yueda Kia. As a result, the management structure was reorganized into a two-party system, and the company name was changed to its current form.

The new Sportage to be launched in China next month is the 5th generation model, newly introduced after six years since the 2015 release. It is one of Kia's representative SUVs. It began selling domestically in July last year, in Europe in November of the same year, and in the United States starting February this year.

The Sportage ranks among the top-selling models at Kia. From January to September this year, it ranked 3rd domestically with 38,486 units sold, following the SUV Sorento (49,726 units) and the minivan Carnival (39,166 units). During the same period in Europe, it sold 108,973 units, ranking 2nd among all models after the Ceed (109,614 units).

Kia has struggled in China so far. Sales sharply declined in 2016 due to the deployment of the Terminal High Altitude Area Defense (THAAD) system. Wholesale sales in China were 650,000 units in 2016 but dropped sharply to 360,000 units in 2017. Sales increased slightly to 370,000 units in 2018.

However, due to the COVID-19 pandemic and lockdowns in China, sales continued to decline. Sales dropped to 259,000 units in 2019, 225,000 units in 2020, and 154,000 units in 2021. This year also showed poor performance. By the third quarter, cumulative sales were 68,000 units, a 24.4% decrease compared to the same period last year. Kia explained that the decline was influenced by reduced sales of key volume models due to weakened brand power and disruptions in dealer operations caused by local lockdowns.

Kia plans to use the Sportage as a stepping stone to increase sales in China, aiming to raise sales to 38,000 units in the fourth quarter. Furthermore, starting next year with the electric vehicle model EV6, Kia plans to launch new electric vehicle models annually in the Chinese market, building a full lineup of six dedicated electric vehicles by 2027.

This content was produced with the assistance of AI translation services.