Kia set to level Hyundai’s sales Down Under

KIA Australia chief operating officer Damien Meredith says the brand is on its way towards levelling – or even bettering – the third-place sales position set by its sister brand Hyundai and that it would continue to grow its sales success by adhering to, and investing in, its current dealership model.

 

Locally, there is little doubt that the Kia brand is gaining more traction in the Australian market with each passing year. The South Korean importer finished 2021 in fifth place overall by selling 67,964 new vehicles, which was a 6.5 per cent market share, a 21.2 per cent increase over the previous year, and just 4908 units shy of sister company Hyundai’s overall total (a 6.9% market share, which includes commercial vehicles).

 

Varying supply levels between Hyundai and Kia locally have resulted in an intriguing stoush between the duo; the rising quality of Kia products, divergent design languages and increasingly competitive value propositions have put the brands in a neck-and-neck race toward the pointy end of the annual sales ladder.

 

Kia is also within striking distance of Ford, which finished 2021 in fourth place. A broadening Kia range and the arrival of Ford’s new Ranger light commercial utility could see the Korean marque engage in a similar battle with the Blue Oval throughout 2022, with mere thousands of units separating third, fourth and fifth.

 

But it’s the battle between Kia and Hyundai that is piquing the attention of motoring statisticians. The group’s rise through the ranks is unprecedented in terms of speed, a factor that Kia Australia’s COO insists is not a one-off; the ongoing growth of the marque in our market can be attributed to a wide variety of factors.

 

“If you consider the last seven years, in 2014, we were at 28 per cent of Hyundai’s local sales volume, and this year we were somewhere between 90 and 92 per cent. So obviously there has been a dramatic shift, but the fact of the matter is that that can be for a lot of different reasons,” Mr Meredith explained.

 

“In the earlier part of last decade, Kia was undersold in many ways. Our products have undergone major changes since then, and there’s been an equally significant change in the way buyers see the Kia brand.”

 

Kia is likewise asserting its dominance over key sectors of the Australian new-car market. The brand’s Picanto holds top place in the Micro car category, while the Rio now holds a second-place position in the Light Car (Under $25k) segment behind the MG 3. The Cerato finished in fourth place in the Small Car (Under $40k) division for 2021, while the Kia Carnival again topped the people-mover segment.  

 

The brand also saw a significant uptick in sales and segment share across its growing SUV line-up. The Stonic light SUV topped its category in 2021, while the next-size-up Seltos finished sixth in the hard-fought SUV Small (Under $40k) segment. 

 

The mid-sized Sportage was one of the few Kia models to slip in 2021 – perhaps as a result of the model-year changeover and ongoing supply constraints – down to seventh place, while the larger Sorento finished ninth outright in the SUV Large (Under $70k) category.

 

Speaking to Mr Meredith at the launch of Kia’s all-electric EV6 this week, GoAuto News discovered that the success of the Kia brand Down Under has been something of a slow burn – its current results reflect a decade’s hard work.

 

Mr Meredith attributed much of the step change in Kia’s fortunes to a strong dealer network. He said the professionalism of the brand’s more than 90-strong dealer network reflected the maturity of the brand, and that it would continue to improve as newer – and more premium – models arrived.

 

“We’ve got a far better dealer network than we did all those years ago. There has been a lot of change internally and we’ve had a lot of experienced people enter the business over that period. 

 

“There’s also been the introduction of the seven-year warranty, etc. Overall, there have been many variables that have changed the dynamic of the Kia brand in Australia,” he said.

 

“As for whether we can outsell Hyundai, well, there’s certainly no edict from South Korea that says we can’t. In fact, it’s happened a few times throughout the year month by month, and is quite common in regions including Scandinavia, parts of the Middle East and in Israel.

 

“But I need to stress, it’s not a datum that we’re driven by. If it happens, it happens. What we want to do is be a consistently improving brand. We’ve done that reasonably well over the years, and we’ll continue along that pipeline,” Mr Meredith added.

 

Mr Meredith said the increased quality, desirability and proven reliability of Kia vehicles, as well as the brand’s participation in a growing number of market sectors, would continue to propel the brand forward. 

 

He said the company would continue to invest in staff training and the customer experience offered at its dealerships and service centres, but it would not expand its number of premises to inflate sales figures. What’s more, Kia Australia would, under no circumstances, consider an agency model to bolster its profits.

 

“One of our drivers is to increase the number of sales per dealership, and that’s jumped dramatically over the years, but we don’t want to ‘over dealerise’,” he said to reiterate the importance of the brand’s existing dealerships to the company’s ongoing success.

 

“We want our dealers to be profitable, (because) if they’re profitable, they’ll reinvest, and if they reinvest in our brand, that will make the brand even stronger at a retail level, and stronger overall,” he outlined.

 

“There is certainly no appetite whatsoever to move to an agency model,” Mr Meredith clarified.