Fleet News

Kia kick-starts expansion

KIA has announced plans to build a European product plant in Slovakia. The move will help it to boost sales in the region as part of an ambitious expansion drive.

The €700 million factory will produce 200,000 cars a year, divided evenly between a B and C-sector car, and is expected to open in late 2006.

'This will have an impact on our cost base and the supply chain, reducing leads times and enabling us to react quicker to market trends,' said Kia UK managing director, Paul Williams.

'Our original mid-term predictions were for 300,000 sales in Europe; with this plant we could sell 500,000.'

Kia is targeting 30,000 UK sales this year; 40,000 in 2005 and 50,000 in 2006, equating to around 2% market share.

It will have 134 dealers by the end of March rising to 155 by the end of the year.

'The quality of groups that are approaching us is improving - more dealers are considering us and the new product plans help,' says Williams. 'We've also got a lot of dealers who want to expand with us by opening multi-million pound single franchise sites. Block exemption has helped us because we have picked up a number of dealers who lost their franchise.'

Once the factory is churning out cars, Williams forecasts Kia will need around 180 sales points to handle the increase in volume. Mid-term market share could reach 3.5%.

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