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08_
Kia Motors Annual Report 2007
President’s Message
The year 2007 was a period in which Kia Motors
faced numerous adversities and challenges such as
shrinking sales caused by intensified competition at home
and abroad. Nevertheless, we were successful in laying
the foundation for taking a new leap into the future.
In 2007, Kia Motors recorded 1.114 million units in
sales, KRW 15.95 trillion in revenue, KRW 55.4 billion in
operating loss, KRW 25 billion in ordinary income and
KRW 13.6 billion in net income. Due to sluggish sales, the
shrinking domestic RV market and declining export prices,
sales revenue fell by 8.6% compared to the previous year,
and operating profits also dropped below zero. However,
thanks to the strenuous efforts to reduce costs, the
operating loss decreased by KRW 69.9 billion compared to
the previous year.
Kia Motors failed to reach its target sales and profits
due to the worsening domestic and overseas business
environment. However, we took it not a risk but as an
opportunity to improve the fundamental factors that drive
our overall competitiveness such as development of future
growth engines and strengthening our corporate structure.
In particular, with rapid stabilization of the Slovakia
plant and successful launch of the cee’d, establishment of
our European operation’s new head office, start of
production at Kia’s second plant in China and smooth
construction progress of our North American plant in
Georgia, USA, we have significantly expanded our global
management activities. This far reaching establishment of
global production lines and sales networks will allow us to
more effectively respond to today’s rapidly changing global
auto industry.
Backed by sound global quality management, Kia
Motors for the first time has entered the top tier of
automakers in J.D. Power and Associates’ 2007 Initial
Quality Study (IQS). By joining the ranks of the top quality
leaders, Kia is now presented with a golden opportunity to
change the public perception of Kia Motors around the
world.
In the domestic market, we responded to market
demands last year by strengthening product attrac-
tiveness. Moreover, we were able to reap meaningful
results under difficult market conditions without any of
new models launches in 2007. The Opirus (Amanti) has
maintained its top market share position in the large
passenger car segment, the Pride (Rio) and Sportage also
ranked first in market share in their respective segments,
and we have maintained the top position in the KS-SQI
(Korean Standards - Service Quality Index) for four years in
a row.
In addition, we began to establish a long-term
foundation for profitability improvement by launching the
Greetings to
our valued shareholders,