- Kia secures inroad into China by localizing the production of Cheolima
- Strategic positioning to capitalize on vast potential of Chinese market
SEOUL November 18, 2002 -Kia Motors Corporation cemented its foothold in the Chinese automobile market today by holding a celebration event to commemorate production of the first Cheolima - a car developed exclusively for the Chinese market.
The ceremony, held at the plant site in Yencheng City, Jiangsu Province in China, was attended by various dignitaries and guests including Mr. Byung-Jae Park, Vice Chairman of Hyundai-Kia Motors, as well as Kia`s Senior Executive Vice President and C.O.O. Mr. Myung-Hun (Mark) Juhn.
Mr Park took the opportunity to outline Kia`s immediate plans for China, saying, "Kia Motors Corporation, in cooperation with our partners in Dong-Feng Yueda, will further modernize and raise the capacity at our existing plant in Yencheng City for the Cheolima and the Pride. The new plant that we are currently constructing will feature state of the art production capabilities and will be by far the finest facility of its type in China. This plant will be used to produce the new models that we are developing for the Chinese market."
He added, "As a member of the WTO, China will gradually lower tariffs and quotas on completed cars and auto parts and the booming economy and increasing demand from the local market for automobiles presents great potentials for Kia." Leading analysts are predicting a market of 50 million vehicles by 2010.
Designed to cope with the wide extremes of climate and terrain in China and available in three trim levels, the Cheolima is a four-door saloon with a choice of a 1.3 and a 1.6 gasoline engine. 5,000 units of the Cheolima will be produced this year with a production of 50,000 scheduled for 2003.
Today`s event was the cornerstone of Kia`s sales strategy in the Chinese market. Besides the Cheolima and Pride model, which is currently being assembled in China on a knock-down basis, DYK will produce other Kia models in the next two to three years in order to expand its market share and to lay the foundation to eventually produce and sell approximately half a million cars in China by 2010, the target year for Kia`s goal of becoming a global top five automaker as part of the Hyundai Automotive Group.
On an earlier occasion in China, Hyundai-Kia Motors Chairman Mong-Koo Chung summed up Kia`s involvement in China, saying, "Considering the geographical proximity and historical ties between Korea and China, the DYK partnership and Kia`s overall presence is not only an ideal business opportunity, but also a relationship that will greatly benefit both countries."
Dongfeng Yueda Kia Motor Co., Ltd., is a joint venture established in March 2002 between Kia, the Dongfeng Automotive Group - one of China`s top three automakers - and the Yueda Group. Kia controls 50% of the company and Dongfeng and Yueda each control 25%.
Founded in 1944, Kia Motors Corporation (www.kia.co.kr) is Korea`s oldest manufacturer of automobiles. A part of the Hyundai Automobile Group, the company currently exports approximately 600,000 vehicles per year through a network of distributors that covers 160 countries. Kia Motors is the major sponsor of the Australian Tennis Open.