Kia 2003 Annual Report Download - page 12

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Competitive Edge in Passenger Vehichles Sharpened by
Opirus and Cerato
Kia Motors, unchallenged in its number-one position in the RV (SUV
and MPV) market with the Sorento and Carnival II, is now setting its
sights on the passenger vehicle market for this year. Competitveness
in Korea has been boosted with the launch of the full-sized luxury
Opirus in March, followed by the Cerato, a compact sedan, in
November. Opirus, having already been launched in Europe and the
US, has become the first full-sized passenger car from Korea to
compete in the overseas luxury vehicle markets. The Cerato was
developed at Kia’s special pilot plant using a state-of-the-art quality
assurance system. This flagship car boasting unprecedented quality
sports a sleek European-style exterior and has scored five stars in the
NCAP safety test. The model is loaded with top-grade components
and features like the curtain airbag, which will continue to attract
strong interest and attention within the C-segment car market.
4 Millionth Unit Exported, US$ 5 Billion Export Tower
Award Received
Kia Motors exported its first vehicles in 1975 with the shipment of 10
Brisa Pickups to Qatar. The company’s overseas marketing operations
acquired a massive export network through its North-American
distribution of the Pride in 1987. Kia successively passed the million-
car export mark in 1995, the 2 million mark 1998 and the 3 million
mark in 2001. In November this year, aggregate exports broke 4
million-units. Kia Motor’s market share is growing at a dazzling
speed, particularly in the US and Europe. Nine years after its
automobiles first entered the US market, Kia Motors’ cumulative
sales surpassed 1 million units there in February 2003. Meanwhile,
Canadian sales reached 100,000 units in September, only 48 months
after the company’s market debut. Kia Motor’s remarkable success
received official recognition on November 28 during the 40th
International Trade Day, when the company was awarded the US$5
Billion Export Tower Award.
Average Exported Automobile Price Reaches US$ 10,000
The average price for Kia’s exported vehicles has been rising steadily.
The average price per unit was a mere US$8,700 in 2000, climbed to
US$9,400 in 2001, US$9,800 in 2002, and on to US$11,200 in
2003. Such a sharp rise in price is largely due to expansion of value-
added models. SUVs and large-size passenger cars are occupying a
greater portion of the sales mix, which once almost exclusively
consisted of low-end and mid-market models. The improved prices
indicate Kia Motors is not only selling more cars each year, the
company is also growing into a maker of high-quality, high-value-
added automobiles.
Notable Expansion in the China Market
The TianLiMa, produced and marketed by DYK(Dongfeng-Yueda-Kia), a
joint venture with local automobile makers, proved to be a huge success,
giving rise to a ‘Korean car fever’ in China. A mere 3 months after its
market debut, sales of the compact model soared to an impressive 10,000
units, and by 2003, a total of 43,900 cars were sold. Chinese respondents
to consumer surveys described the TianLiMa as ‘the best-quality and the
most dynamic car,’ ‘the car the most favored by young adult drivers,’ and
‘a contemporary car in keeping with the temperament of our times.’ The
TianLiMa has indeed captured the local consumers’ hearts, becoming one
of the most popular economy models in the market. Dongfeng-Yueda-
Kia sold close to close to 51,000 units in 2003, a 150% rise year on year,
and the upward trend is expected to continue.
Sports Marketing Beefed Up for Heightened Brand
Recognition
Kia Motor’s sports marketing operation, launched as an effort to boost
brand recognition, turned out to be right on the mark. The positive
outcome of the campaign has prompted Kia Motors to extend its contract
for the main sponsorship of the Australian Open, originally entered for the
Australian Open 2003, for five more years. The company has also
concluded a three-year contract to be an official sponsor for the Davis Cup
tournaments in Europe and Africa through 2005 in an all-out bid to
broaden recognition of the Kia brand. Meanwhile, Kia sponsored the
Korean national team at the 21st Winter Olympics early in 2003, and the
squad garnered two gold medals. The company was also the official
sponsor for Le Tour de Langkawi 2003, one of the world’s most prestigious
bicycle races.
12 Kia Motors Corporation
2003 at a Glance