INTERVIEW: Kia Motors’ 2021 plan includes 11 electric vehicle launches — but India may have to wait longer
- Kia India’s top executive Tae-Jin Park revealed to Business Insider that the company is gearing up to launch its first EV in 2021 globally and aims to have 11 EV models by 2025.
- However, he highlighted that those EVs might not enter India right after the launch, given the weak infrastructure.
- The South Korean automaker said it would continue to expand its business in India, making it the global export hub.
- "We are finalising our upcoming expansion plan, and we will soon announce that. We are aiming to reach 300 touchpoints soon with a prime focus on cities beyond the metros like the northeast, the northern part of Telangana, Karnataka, and Western Rajasthan, etc.," Park said.
The top executive at Kia India said the company is gearing up to launch its first electric vehicle (EV) in 2021, in the global market, and aims to have 1 million electric vehicles by 2026. "Under our Plan S, we aim to have 11 EV models by 2025 to target 6.6% of the global market for EVs, which is approximately 500,000 units per annum of different segment vehicles and 1 million vehicles cumulatively by 2026. We are working towards launching our first product under Plan S to the global markets by 2021," Park said.
However, he highlighted that those EVs might not enter India right after the launch, given the weak infrastructure. Indeed, the Indian electric vehicle (EV) market is now gaining momentum, but the infrastructure continues to be a big challenge for automakers. And, so it is for Kia.
AdvertisementThe company said its manufacturing plant is already capable of producing electric vehicles, but it will have to wait till EV is viable for Indian consumers. "Electric Vehicles are like completely new technology altogether, which requires strong foundations for people to adapt. These foundations are infrastructure, affordability and strong policy," Park explained.
While this may come as discouraging news for its Indian followers, Park revealed that Kia has other big plans for its operations in the country.
Making India a global hub for Kia
The South Korean automaker said it would continue to expand its business in India, making it the global export hub. "India is a key market in the global scheme of things for Kia. In fact, our Anantapur manufacturing plant has been developed to make India one of the most critical hubs in the Kia network globally. With the Seltos and Sonet, we are already exporting to over 70 countries across the world. With this, we have planned to make India a global export hub for Kia," Park said.
Given the government's new production-linked incentive (PLI) scheme to boost manufacturing and production, Kia India thinks India will be a key market in its parent company's global scheme of things. The government's PLI scheme includes incentives of ₹57,000 crore over five years and focuses on making Indian companies globally competitive by driving exports.
The company's primary aim, for now, is to attain full manufacturing capacity of 300,000 units at its state-of-the-art facility in Anantapur by 2022. And, after beginning the second shift recently at its manufacturing unit, it said, "we are confident of achieving 100% capacity utilisation by 2022."
Good news on the way!
Kia received an overwhelming response from Indian buyers, making it to the country's top 4 carmakers in just a span of one year. According to Kia, the company currently holds 6% of India's total market share and was able to make its place despite tough competition from largely dominated brands like Maruti and Hyundai.
According to HDFC Securities report, In SUVs segment, the Korean OEMs Hyundai and Kia have gained share at the expense of Maruti and Mahindra. The market share of Hyundai and Kia has risen to 36% compared to 28% in FY20.
AdvertisementAnd, Kia said it is now preparing to nurture this love and support in the coming year by expanding its network further.
"Hence, based on the market potential, we are finalising our upcoming expansion plan, and we will soon announce that. We are aiming to reach 300 touchpoints soon with a prime focus on cities beyond the metros like the northeast, the northern part of Telangana, Karnataka, and Western Rajasthan, etc. where we are not present yet," Park said.
SEE ALSO: Not all Big Tech stocks will soar in 2021, says Gene Munster. He breaks down 2 FAANG companies that will continue to gain and 2 that will lag.
The top energy stories of 2020 - and what to expect in the year ahead
From Tesla to PayPal, Carnival to Occidental, here are the 5 best and worst performing stocks in the S&P 500 in 2020