(Yicai Global) April 11 -- South Korean carmaker Kia Motor Corp.’s joint venture in China fell behind its sales target in the first quarter, but hopes to get back on track with the release of a new vehicle this month and 17 more over the next two and a half years.
Dongfeng Yueda Kia Motor Co. plans to sell 500,000 vehicles this year, General Manager Su Nanyong told Yicai Global in an interview. The firm sold just 82,200 in the first quarter after a shaky start, but shipped 30,500 in March, up 9,000 from the month prior. February was a slow month across the country, mostly due to Chinese New Year, a week-long holiday which people tend to spend at home with family.
However, Su is confident that the release of a smart sports car on April 17 will put the firm back on target. He also has a grander plan to promote new-energy vehicles, for which China is the world’s largest and fastest-growing market, and have electric cars making up 40 percent of all sales by 2025.
Dongfeng Yueda Kia, a three-way partnership founded by state-owned Dongfeng Motor Corp., Jiangsu Yueda Investment Co. and Kia, was once among the top eight carmakers in China by sales volume. It made its five millionth vehicle on April 9 to become the ninth China-foreign joint venture ever to reach the milestone. The firm hit an all-time high of 650,000 units sold in 2016, but saw a sharp decline the following year, the same year China snubbed South Korea for allowing the United States to build a missile defense system in the peninsula nation.
Su believes rising competition from China’s own brands, as well as rivals from Japan, was one of the key factors in the 2017 decline. He also blames a relaxed attitude to cost-effectiveness and vehicle features. He plans to improve design, technology and cost control to regain physical strength after the firm “caught a cold” last year.
The firm partnered up with China’s leading search provider and artificial intelligence giant Baidu Inc. in November to release a revamped version of its Forte model. The car features a Baidu-made navigation system and voice recognition assistant.