Interview: Paul Philpott, president & CEO, Kia Motors UK
How is 2015 shaping up so far?
We’re on track to do about 80,000 units this year, that’s the first time we’ve broken through 80,000. Last year was 77,200, 3-4% growth is what we’re targeting. We always said 2014 and 2015 would be years of consolidation because the new products come from 2016 onwards. Our fleet business is in good shape – we currently have 24 Business Specialist Dealers, and with the new product we’re looking to grow that to around 30 during 2016.
What are your expectations for the new Sportage?
Sportage is a bit of a phenomenon for us. In its last year we’ll hit a record volume of over 22,000, and we’re looking to grow further. The SUV segment is still growing, if you look at the Nissan Qashqai it’s selling over 40,000 cars. Therefore 22,000 shouldn’t be a limit for Sportage, even though today it represents 27-28% of our total sales. CO2 comes down under the 130g/km which will open up a lot of fleets that used to buy it but, since the 130g/km capital allowances, we’ve not been selling to them.
To what extent has the Optima been held back by a limited range?
We’ve sold on average about a thousand a year, and we’re Europe’s top market at that level. Optima has always been well accepted in terms of its design, but I think the biggest restraint was only having a sedan. In Europe the segment is 75% wagon, in the UK it’s about 45% wagon, so having two body styles, broadening our engine range and having a high performance GT version all adds to the opportunity.
New Optima will launch with the 1.7 CRDi sedan. With that, we’re looking to maintain our sales pace at about 1,000 per year. Once we get a broader offering we’re looking to increase our annual sales to over 4,000 units, which is significant growth. We’re also setting out our strategy with user-choosers in mind, so it will come with standard full-screen navi from the entry grade onwards.
Has there been a change in the way people buy Kias recently?
Across the range, more and more cars are going to 3 and 4 grades. In new Sorento, sales are up 60%, versus the same period last year, and within that 55% of sales are KX-3 and 4 grades, on the old model it was about 30%. When you think that KX-3 is priced at almost £36,000, KX-4 is at £41,000, we’re not talking about high value, low price Kias. That’s where our growth is coming from, which says that a broader section of the population is buying into the Kia brand.
What role do you see for alternative drivetrains?
I think they will be another major driver of the growth going forward. Compared to someone like Toyota with their hybrid offering, we’ve had – in the UK and right hand drive – Soul EV plus petrol and diesel. The introduction of hybrid and plug-in hybrid going forward will be a significant part of our strategy to grow by 2020. They’ll broaden our offering.