Kia India guns for 30% growth in FY2022, to ramp up production by July

Kia India, the No. 5 player in the passenger vehicle market and the No. 3 in the utility vehicle market, is eyeing speedy growth this fiscal. Despite the unfolding challenges of supply chain constraints and the return of the pandemic, the company is optimistic of achieving about 30 percent year-on-year growth this fiscal.

The Korean carmaker is implementing a rebranding exercise, part of which is dropping ‘Motors’ from Kia Motors India. According to Kia India CEO and MD, Kookhyun Shim, “To assure our customers about our commitment to significantly reduce the delivery times on our products, we will be working round the clock to stock cars at our plant very soon.”

Harpreet Singh Brar, vice-president and head of Sales and Marketing, Kia India, said, “Currently we have a waiting period of 3-4 months on our products and despite all the tough times and lockdowns in five states, we still have a lot of demand from the rest of the markets, so we are trying to supply cars to these cities.”

“Right now, the situation is very fluid and uncertain, but the good thing this time is that unlike last year, the lockdown is in phases and not on a national scale. So, if everything goes fine, we are looking at anything in the ballpark of 200,000 units by end-FY2022,” he added.

Kia India had clocked total sales of 155,286 units in the 11-month period of FY2021, considering that the month of April 2020 was a washout due to the nationwide lockdown. It had registered a growth of 82.9 percent on a year-on-year basis, with FY2020 volumes being pegged at 84,903 units.

“We hope to ramp up production by June-July and start the third shift at the plant, as we hope that the pandemic-related supply-chain issues should be resolved by that time,” Singh added.

Surpassing expectations
Kia India has a state-of-the-art 300,000-unit annual capacity plant in the Anantapur district of Andhra Pradesh, where it locally produces the Seltos and Sonet SUVs, while assembles the premium Carnival MPV from CKD kits.

While the Seltos midsized SUV was its first product for the market, the introduction of the Sonet compact crossover in September 2020 marked an overwhelming 260 percent jump in performance with domestic sales growing from 8,000 units in Q3 of 2019 to 30,000 units in Q3 of 2020.

The Sonet has given a new charge to Kia India, with the company clearly surpassing its own volume projections. 

As per a Kia Corporation investor presentation issued earlier this year, the domestic volume projection for Kia India for 2021 was pegged at 158,000 units, up 14.5 percent over 138,000 units of 2020. With 155,000 units achieved last year, a 200,000-unit target is now next in sight for this fiscal.

If it manages to circumvent the ongoing supply-chain constraints and disruptions like semiconductor shortage due to the Covid pandemic, Kia India will be looking at achieving maximum capacity utilisation by 2022 after including exports, as it has revealed to introduce an India-specific midsized MPV in January 2022, eyeing 50,000 units of domestic sales from the model that is codenamed ‘KY’.