Kia 2002 Annual Report Download - page 17

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Sorento SUV Launch
Kia M otors moved into the fashionable SUV market w ith the launch of the Sorento.
Development of this w orld-class model began in M arch 2000 and w as completed after 22
months at a cost of 300 billion. The Sorento w as unveiled in Europe at the Geneva
M otor Show , and the popular mid-sized SUV received glow ing reports from the press
around the w orld.
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Aggregate Production Tops 10 M illion
The 10 millionth vehicle produced by Kia M otors rolled off the production line on the
morning of April 18th, 2002. The 10 million milestone w as reached 28 years after Kia
began exporting the Brisa S-1000 in 1975. Aggregate production reached 1 million units
in September 1988, 3 million in early 1993, 4 million the next year, and 5 million the year
after that. Production capacity has increased steadily and now exceeds one million units a
year.
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Carnival/ Sedona Proven Top M inivan Overseas
The Carnival/Sedona received top scores in safety tests at home and abroad. Industry
journals in the U.K. and Canada selected the Carnival/Sedona as the best value car
among 2002 minivans, and it earned the U.S. government’s top five-star safety rating.
The Carnival/Sedona w as ranked first in the U.K. among diesel M PV models as w ell.
This minivan has boosted Kia’s image substantially in overseas markets, raising the com-
pany’s profitability
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Kw angju Plant Expansion Kicked Off
On October 1, the Kw angju Plant held a groundbreaking ceremony for an expansion proj-
ect that w ill increase annual capacity to 300,000 units. This w ill be a major development
for the plant, w here production capacity remained at 60,000 units a year during Korea’s
economic crisis. Attending the ceremony, the M ayor of Kw angju, said the new facilities
w ill invigorate the local economy, create many new jobs, and help develop local subcon-
tractors after going into full operation in 2004.
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Q-Service in Full Sw ing
Kia’s new Q-Service brand w as officially launched at 20 direct-run car service
centers as w ell as authorized after-sales service centers and Car Clinic shops
around Korea. A new compensation program for dissatisfied customers w as
also implemented throughout the after-sales service netw ork. Q-Service (the
“ Q” stands for “ quick,” “ quality,” “ quiet,” and “ qualified” ) empow ers
maintenance and repair technicians to assume greater responsibility for their
w ork and reduces customer complaints. By differentiating its after-sales
service form the competition, Kia M otors w ill ultimately see its sales increase.
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5 New Subsidiaries in Europe
Kia bought out distributors to establish its ow n subsidiaries in the U.K., Austria,
Hungary, the Czech Republic and Belgium. The company has restructured operations to
greatly improve sales and after-sales service functions. The creation of subsidiaries
allow s Head Office to be directly involved in local management. These subsidiaries w ill
play a central role in sales in 2003, after operations are running smoothly.
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Top in Automotive Service Quality
Kia M otors w as ranked first in the Automobile category on the 2002 Survey of Korea’s
Best Service Quality Companies, conducted jointly by the Korea Standards Association
and the Dong-Ah Ilbo newspaper. This honor reflects the objective judgment of cus-
tomers. The survey traditionally has been aimed at service industries such as hotels and
departments stores but w as expanded to include the automotive industry in 2002. Kia’s
top ranking serves as recognition of a customer satisfaction program that has been in
place for years.
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U.S. Retail Sales Grow 6%
Kia broke its record for retail sales grow th in the U.S. for the second straight year in 2002.
The company sold 237,345 units in 2002, w hich w as 13,625 more units (a 6% increase)
over 2001.
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2002 Value M anagement Grand Prize
Kia M otors w as honored w ith the 2002 Value M anagement Grand Prize at a ceremony spon-
sored by the Korea M anagement Association on June 20. The aw ard is given to the company
judged to have increased its EVA the most through management innovation. Kia w on the
Korea Quality Grand Prize and Human Resources M anagement Grand Prize last year, and this
latest honor further elevates the corporate image. In his address at the June 20 ceremony,
Kia M otors President Kim Noi-M yung said, “ We w ill further strengthen our customer-orient-
ed management approach and develop cutting-edge technology for future automobiles in
order to realize our vision of making Kia the w orld’s Top 5 automaker by 2010.”
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China M arket Inroads
Kia M otors signed a joint venture agreement w ith the Dong Feng Train Group and Yueda
Group in Beijing to produce Kia’s latest models in China. Construction of a new plant w as
subsequently begun in Yencheng, Jiansu Province, w hich w ill raise annual output capacity
from 50,000 to 300,000 units. Production of the new TianLima sedan began in November
and has been w ell received by the Chinese public. This is the first car to be completely pro-
duced locally and represents a major breakthrough for Kia in the China market.
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Kia Motors in 2002