Kia 2000 Annual Report Download - page 5

Greetings Shareholders.
On the occasion of our 57th annual shareholdersmeeting, I offer my gratitude for your unreserved encouragement
and support over the past year. And, as always, I wish you continued health and prosperity.
The year 2000 was one of the most meaningful in Kia Motors57-year history as we embarked on a new beginning.
We got out from under court receivership in an amazingly short period, recorded our second straight year of profitable
operation, and also realized our best year ever with 10.8 trillion won in sales and 330 billion won in net profits. These
achievements, in combination with the successful spin-off of our affiliates, mean that we, along with Hyundai Motor, are
now set to join the ranks of the worlds top automobile producers.
Last year, under a banner of aggressive management, quality innovation and technological innovation, Kia Motors
pursued many challenging business objectives and achieved numerous successes. Domestically, we strengthened product
competitiveness with the launch of the new Spectra and Optima. We sold 410,300 units domestically, for a 36% increase
over the previous year. Meanwhile, we improved profitability by terminating production of non-profitable models and
enhanced our sales system.
Overseas, we exported 549,437 units for a year-on-year increase of 17%. The successful launching of the Rio in
North America contributed to further elevation of the status of Korean automobiles in that strategic market. The
Production Division improved capacity utilization and productivity, establishing a solid foundation for continued
profitability. This was accomplished by specializing production at each of our facilities through the reorganization and
expansion of production lines.
We continued our company-wide Six Sigma Campaign to enhance the quality of our products and services. Moreover,
our real-name maintenance system and round-the-clock Overseas Quality Control Centers have brought customer satis-
faction levels to an all-time high.
In addition, our Headquarters was moved to a new building in Yangjae-Dong in southern Seoul ; a building we share
with Hyundai Motor. We are now achieving maximum synergy effect in all divisions through greater collaboration
between the two companies.
Kia Motors normalized operations sooner than anyone expected. However, rather than engage in self-praise, Kia will
open up a new future of even greater challenge and accomplishment based on the strengths and confidence we have
forged thus far.
For the year ahead, we at Kia have chosen to incorporate belt-tighting, flexibility and crisis controlinto our man-
agement policy. Expected problems in the business environment will be dealt with prudently. At the same time, we are
forecasting sales of 1.14 million units, with gross sales of 13 trillion won and ordinary income of 500 billion won.
Although a year-on-year drop in domestic demand has been forecast, Kia expects to sell 410,000 units locally for a
30% share of the market. We will accomplish this by focusing marketing efforts on our top-selling models, reinforcing
our sales organization and expanding our overall sales activities.
To offset stagnation in the domestic market, Kia has set an export goal of 740,000 units for a 34% year-on-year
increase. Exports of Optimas, Carnivals and other new Kia models are expanding, and we are strengthening our regional
marketing efforts to gain a greater competitive edge.
Our plants in Hwasung, Sohari and Kwangju have implemented a system of accountability that will ensure we achieve
our sales targets without any production setbacks. Our priorities are on quality and delivery dates to further bolster our
international competitiveness in productivity.
Kia is also continuing to push forward with the Six Sigma Campaign, introduced last year. Every Kia employee is
committed to constant quality improvement, with the aim of winning the Korean Quality Grand Prize,the most presti-
gious award of its type in the nation.
We are accelerating efforts to improve profitability. Our approach is to wring out the dry towel againso that ways
are found to reduce costs in all divisions, starting from product planning.
Over the long term, Kia is pursuing projects in China, Brazil and Indonesia. Of course, these and other such projects
are being carried out carefully and with thorough examination.
The corporate tax problem that had long affected Kias operations has been resolved in our favor. The resulting
judgement has had a very positive impact on our liquidity and share price. At the last extraordinary general
shareholdersmeeting, approval was given to reduce the total number of Kia shares by 80 million. As of the end of
January, 43 million shares had been purchased and disposed of. Kia will continue this process until years end, helping
to boost our share price.
Although many economists have predicted difficult business conditions for this year, Kia employees stand united in
their determination to turn crisis into opportunity. For Kia and Hyundai Motor to join the ranks of the worlds elite
automakers by 2010, we will overcome all obstacles while accelerating growth and development.
Once again, we ask you for your continued devotion, support and encouragement in order to make Kia a world-class
automobile producer.
In closing, I humbly thank you for attending the 57th annual shareholdersmeeting. May you enjoy the best of health
and happiness in 2001.
Through record-breaking sales
and two consecutive years of
profit, we now have the necessary
foundation to meet all challenges
in the 21st century.
KiaM otors annual reports 2000
17th March 2001
Kim Soo-joong
CEO & President
Kia Motor Co., Ltd.
PRESEIDEN T' S MESSAGE