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THE INVESTOR]
Kia Motors, a
Hyundai Motor's smaller affiliate said on July 27 it plans to roll out a new sport utility vehicle in China in response to stagnating car sales in the world’s second largest economy.
“In China, we will unveil a new SUV, similar to Sorento, next year,” Han Chun-soo, Kia’s chief financial officer, said at the conference call after announcing the Q2 results. “Besides SUVs, we will also include compact cars and the K5 hybrid model in the new lineup to increase presence in the country.”
Kia Sorento is one of the carmaker’s best-selling SUV models overseas. / Kia Motors
South Korea’s second-largest automaker and Kia Motors posted a solid profit in the first six months this year, however, its presence in the fast-growing Chinese market has stumbled.
In the first half of the year, Kia sold 286,000 units in China, down 5.8 percent on-year.
“Chinese sales struggled in comparison to other markets,” Han said. “But sales of the Chinese unit are gradually improving and the operating profit grew at 3.6 percent in the second quarter. We will plan our sales strategy based on regaining profitability rather than on increasing the volume (of sales).”
Meanwhile, Kia posted the second-quarter operating profit of 770.9 billion won (US$679.20 million), up 18.5 percent from the same period last year.
Net profit came to 825.7 billion won, up 10.6 percent on-year. Sales also jumped 16.1 percent on-year to 14.45 trillion won, the company’s best results since 2010. In total Kia sold 752,133 units in the cited period.
As for the first half of the year, sales jumped 14.7 percent on-year to 27.9 trillion won, with operating profit surging 20.8 percent to 1.40 trillion won, reaching a three-year high. In total, Kia sold 1 456,590 units in Korea and overseas.
By Ahn Sung-mi (
sahn@heraldcorp.com)