Recently, Yang Honghai (Richard), Chief Operating Officer of Kia China, stated during a media briefing after the Kia EV5 static evaluation event that it is impossible for Kia to withdraw from the Chinese market. He dismissed these rumors as false information created by some self-media outlets for the sake of generating traffic. The entire research and development team in China has put in tremendous effort into the global model EV5, and we will steadfastly advance on the path of electric vehicle electrification.
The Kia EV5 is the first domestically produced battery electric SUV by South Korean automaker Kia in China. It was previously pre-sold at the 2023 Chengdu Auto Show, with a pre-sale price range of 159,800 to 229,800 yuan (approximatly ＄21,837-31,402). It is expected to be officially launched at the 2023 Guangzhou Auto Show. The Kia EV5 is positioned as a compact battery electric SUV, with dimensions of 4615/1875/1715mm (length/width/height) and a wheelbase of 2750mm. In terms of powertrain, the Kia EV5 is equipped with a front-mounted single motor with a maximum power output of 160 kW and maximum torque of 310 Nm. For its battery, it will use lithium iron phosphate batteries produced by Xiangyang Fudi Battery Co., Ltd. As for suspension, the Kia EV5 will feature front MacPherson struts and rear multi-link independent suspension systems.
According to the plan, this year will be the first year for Kia’s entry into the Chinese electric vehicle market. Starting from 2023, Kia will launch at least one pure electric vehicle based on the Electric-Global Modular Platform (E-GMP) in the Chinese market every year. By 2027, a total of six EV models will be launched. It is expected to achieve an annual sales volume of 450,000 units by 2030, with EV models accounting for 40% and reaching 180,000 units.
In addition to the Kia EV5, the Kia EV6 has been launched at the 2023 Chengdu Auto Show. This is Kia’s first electric vehicle built on the E-GMP platform, with a suggested price range of 282,800 to 419,800 yuan (approximatly ＄38,645-57,366). Furthermore, Kia plans to introduce a flagship electric SUV called the EV9 in 2024. Then from 2025 to 2027, they will respectively release an entry-level pure electric SUV, a high-end electric sedan, and a mid-size pure electric SUV. These products aim to bring more diverse and outstanding options for Chinese consumers.
Ideals are lofty, but reality can be harsh. Although Kia has promised not to withdraw from China, it is ultimately just a promise. Currently, the Kia brand does not have a strong presence in the domestic market, which is why there have been multiple rumors about its withdrawal from China. Retail data shows that in the first three quarters of 2023, Kia’s cumulative sales reached 61,681 vehicles, ranking 18th among domestic joint venture brands, between Changan Mazda and Changan Ford.
In fact, in recent years, it is not only Korean brands that have seen a decline in sales. German, Japanese, American, and Korean brands are all facing the same situation. Even Volkswagen and Toyota are finding it difficult to resist the breakthrough of domestic brands. The relatively strong sales background of these brands is also due to the expansion of discounts in the consumer market.
For modern Kia, although its performance in the Chinese market has been unsatisfactory, it is still the third largest automotive company globally with a sales volume of 6.848 million units in 2022. Hyundai Motor Group attributes the sales bottleneck in the Chinese market to the three-year epidemic situation, as communication was disrupted and they were unable to better understand the needs of the Chinese market. Now, Hyundai Motor Group has also noticed that China’s automotive industry has taken a leading position globally in terms of smart cars, and competition for intelligentization in the Chinese automotive market is already quite intense.
Currently, the transformation task of Korean car brands is challenging. If this transformation fails, they may face the possibility of withdrawing from the Chinese market. However, compared to some struggling brands on the verge of collapse, Korean car brands still have a certain market foundation, including the supply strength of overseas groups, which gives them a chance to turn things around.
From the current market changes, Korean car brands have taken two different paths. On one hand, Hyundai and Kia are undergoing a transformation towards high-end positioning. Similar to Chinese brands, they are significantly improving their products and targeting blank markets strategically. This also involves phasing out old and low-end models while striving to enhance brand image. On the other hand, there is a transition towards new energy vehicles including electric cars and hydrogen fuel cell vehicles.
