Kia Expects to Increase Market Share
SEOUL - Driven in particular by strong demand for its cars in the U.S., Kia Motors Corp. expects to grab a significantly larger slice of the global automobile market this year, a senior executive said on Friday.
"The company will have no problem in exceeding the previously-announced sales target of 2.43 million units for this year as demand is strong, particularly in the U.S., Latin America and Russia markets," Thomas Oh, senior executive vice president of Kia Motors' international business division, told Dow Jones Newswires in an interview.
Kia Motors, which together with parent Hyundai Motor Co. forms the world's fifth-largest car maker, is targeting a 3.4 percent share of the global market in 2011, reported The Wall Street Journal. Last year, Kia had a 2.9 percent market share as it sold a total of 2.13 million vehicles, including overseas sales of 1.65 million vehicles.
In the U.S. alone, the company is aiming for a share of more than 3.2 percent this year, up from 3.1 percent a year earlier.
Kia's bullish outlook comes as strong sales of new models such as the Optima sedan, Sportage R sport-utility vehicle and Picanto mini car helped it record a 91 percent jump in net profit in the first quarter. The new models are part of a revamped brand strategy, under which Kia has overhauled its designs, guided by Peter Schreyer, a former top designer at Audi and Volkswagen.
Analysts have identified Kia as a potential beneficiary of supply problems at Japanese auto makers who have had to idle plants in the wake of the earthquake and tsunami in Japan.
Mr. Oh wouldn't be drawn on the impact of the earthquake on sales, but said that any benefits for Kia depend on whether customers are willing to wait for delayed shipments of Japanese cars.
As it seeks to raise its market share in the U.S., Kia recently decided to add a third shift at its Georgia plant to raise its overall production volume of Optimas.
"Once the third shift is adopted, productivity at the Georgia plant will rise to 360,000 units [annually] from the existing 260,000 units," said Mr. Oh, who also serves as chief operating officer for the South Korean auto maker.
Mr. Oh identified high oil prices, high raw materials prices and a strengthening won as major challenges for the year.
"We will try our best to complete our business plans [drawn out based on an exchange rate of 1,100 South Korean won to the dollar] this year by cutting costs and boosting sales of new models," he said. The won traded around 1,083 to the dollar on Friday.
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