Kia 2014 Annual Report Download - page 9

Dear esteemed shareholders,
In 2014, Kia Motors experienced slightly poorer performance
than in recent years, with sales and operating prot affected
by the Korean Won’s ongoing appreciation and the fall of
the Russian Ruble. However, production increased by 8%
from the previous year, reaching our highest-ever level of 3.04
million units. As the 3 million annual sales mark had been
achieved by only eight automakers, this was a meaningful
milestone demonstrating that Kia Motors is primed to
become a leading global player in the industry.
Last year, we significantly reinforced our market
competitiveness. The new Carnival (Grand Carnival/Sedona)
and Sorento models were launched, and their significant
popularity helped boost our status as an SUV powerhouse
while leading our domestic sales in the second half of the
year and contributing to increased sales overseas. In China,
the localized K4 model was successfully introduced, drawing
very positive reviews. In addition, we raised our customer
value by offering a differentiated brand experience thanks
to renovated dealerships and service centers, upgraded
computer systems, and introduction of custom-tailored sales
and service programs.
Meanwhile, we have vigorously promoted Kia’s sports
marketing properties, including our sponsorships of
international sporting events such as the 2014 FIFA World
Cup Brazil, the 17th Asian Games Incheon 2014, the
Australian Open, the NBA, and the Kia Korea Women’s Open
golf championship. And our sensory branding initiatives, rst
introduced in 2013, are effectively communicating our brand
sensibilities to customers around the world through taste,
smell and sound. On the design front, the all-new Soul won
the iF Product Design Award, the Red Dot Design Award and
the IDEA Award, achieving a grand slam of the top 3 global
design awards, and once again garnering recognition for
Kia’s excellence in design.
Hyoung-Keun Lee
Vice Chairman
In 2014, Kia Motors
continued to prepare for the
future, while successfully
coping with challenges both
at home and abroad.
Through such systematic brand marketing, Kia Motors
rose to 74th place on the 2014 Best Global Brands list by
Interbrand, recording USD 5.4 billion in brand value, up 15%
from the previous year.
Kia Motors has been dedicated to securing future key
capabilities and growth engines. We launched the Soul
EV, which boasts global competitiveness in terms of both
performance and price. It has drawn great attention in
the European and North American markets despite being
a recent introduction. The Soul EV will be followed by a
dedicated hybrid/plug-in hybrid vehicle next year, thereby
strengthening our eco-friendly lineup and allowing us to
compete head-on with more established companies in the
eco-friendly car market.
In order to meet rising demand for Kia cars around the world
and guarantee our sustainable growth, we are fortifying our
global production bases including the ongoing construction
of our newest overseas plant in Monterrey, Mexico, which
will boast an annual production capacity of 300,000 units.
Scheduled for completion in 2016, the plant is expected
to serve as a new growth engine by playing the role of
a bridgehead for expanding sales in North America and
exploring new markets in Central and South America.
All of these achievements are a result of your unwavering
support and encouragement, and I would like to take this
opportunity to extend my heartfelt gratitude.
In 2015, we anticipate that the business environment will be
even more difcult. There are concerns that the geopolitical
risk in the Middle East will spread, further affecting ongoing
economic slowdowns in emerging markets including China.
Meanwhile, the efforts of our competitors will intensify, and
the erosion of our domestic market dominance by import
brands will likely accelerate.
Despite these potential unfavorable management conditions,
Kia Motors has set its production and sales goal for 2015
at 3.15 million units, a rise of over 100,000 units compared
to 2014. We plan to carry out differentiated marketing and
promotions alongside exible and speedy production so that
we can effectively cope with the rapidly changing market
environment by closely managing the global marketplace
according to region. In addition, we will enhance our
profitability through the steady sales of the new Carnival
and Sorento models while successfully launching the next
generation K5 (Optima) and Sportage models.
We will further develop our core competiveness in other
ways as well. Since 2012, we have enhanced our capabilities
in all areas, including production and sales, quality, brand,
and organizational culture, after establishing our Vision
2016. In 2015, we will propel our vision forward by delivering
more substantial value to our customers and enhancing our
competitiveness.
We will also prepare new growth strategies for the future
including more detailed and elaborate mid- to long-term
strategies in order to keep pace with the rapidly changing
paradigms in the automotive industry and grow into a truly
global top brand. To this end, all of our divisions will work
together to execute these strategies for the future.
Kia Motors is dedicated to customer value innovation.
We are determined to offer our customers better value by
fostering our own differentiated capabilities, and to reward
our shareholders with greater value by achieving superior
performance. At Kia Motors, our employees and executives
are focused on preparing for the future while addressing
current challenges.
I look forward to your continued interest in and support of
Kia Motors, and sincerely wish you and your families good
health and happiness in 2015.
Thank you.
Vice Chairman’s Message
14 15
Annual Report 2014