Kia logged record-high quarterly revenue in the first quarter, driven by strong demand in major global markets, including high-margin hybrid models in the US and electric vehicles in Europe.
According to Kia’s earnings call on Friday, its sales revenue rose 5.3 percent to 29.5 trillion won ($19.9 billion). Vehicle sales climbed 0.9 percent to 779,741 units — the highest-ever first-quarter volume — while global market share climbed 0.5 percentage point to 4.1 percent, surpassing the 4 percent mark for the first time.
Chief Financial Officer Kim Seung-jun said the US, Europe, Korea, India and other emerging markets have exceeded the company’s planned sales target for the first quarter, offsetting the relative slump in the Africa-Middle East region affected by the Iran war.
Notably, Kia saw a sharp increase in eco-friendly vehicle sales, which rose 33.1 percent year-on-year to 232,000 units in the first quarter. As a result, these models accounted for 29.7 percent of total sales, up from 23.1 percent a year earlier. Kia said hybrid cars and battery-powered vehicles each contributed to the sales expansion in the US and Europe.
Despite rising raw material costs and the Middle Eastern conflict, Kim reaffirmed Kia’s annual sales target of 3.35 million units, led by region-specific sales strategies.
“In North America, we expect solid momentum to continue, supported by full second-quarter sales of hybrid models, including Telluride hybrids shipped from April 1,” Kim noted. “In Europe, we plan to expand our lineup of more accessible EVs, from the EV2 through EV6, as part of our mass-market EV strategy.”
Kim said while the war in Iran may disrupt shipments to the Africa-Middle East region, overall exports from Kia’s domestic plants are expected to increase, supported by stronger demand in emerging markets such as Latin America. To meet this, this year’s production output in Korea and China is expected to increase by approximately 5 percent and 10 percent, respectively.
Citing challenges in Europe, Kim noted Kia’s incentive spending has increased in the region — unlike in the US — due to intensifying competition from lower-priced Chinese EV makers. This has led to price gaps of up to 25 percent, which is making it difficult to reduce incentives in the near term.
“We are maintaining high single-digit margins in the region and will focus on expanding market share while preparing additional countermeasures,” Kim said.
By Byun Hye-jin (hyejin2@heraldcorp.com)
