The Korea Herald


Kia to invest W38tr through 2028 with focus on automation

Automaker to expand hybrid vehicle lineup to counter slowdown in EV market growth

By Kan Hyeong-woo

Published : April 5, 2024 - 14:27

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Kia CEO Song Ho-sung speaks during the automaker’s investor relations day held at Conrad Seoul on Friday. (Hyundai Motor Group) Kia CEO Song Ho-sung speaks during the automaker’s investor relations day held at Conrad Seoul on Friday. (Hyundai Motor Group)

Kia on Friday unveiled a plan to invest 38 trillion won ($28.1 billion) through 2028 in an investor relations event held at Conrad Seoul, vowing to lead the global auto industry’s automation.

According to the Korean automaker, 65 percent of the large-scale investment will be injected into automation, 19 percent will be used for developing purpose-built vehicles, which were redefined as "platform beyond vehicles" at CES in January, 8 percent will be spent on the transition to software-defined vehicles, 5 percent has been allocated for advanced air mobility and robotics and the remaining 3 percent will be spared for other sectors.

Kia said it expects the growth of the global electric vehicle market will slow down from this year to 2026 due to the recession, shrinking subsidies for EVs and a lack of charging infrastructure.

To cope with the dwindling EV market in the short term, the automaker will strengthen its hybrid electric vehicle lineup. Starting this year, Kia will offer hybrid models for six of its vehicles and expand the number of products with HEV model availability to eight in 2026 and nine in 2029.

With more HEV options, Kia projected that the portion of hybrid vehicle sales will go up to 19 percent in 2028 from 12 percent this year.

Despite the EV market slowdown, the automaker reaffirmed its roadmap to aid the mass adoption of EVs with more affordable vehicles. Beginning with the EV3, Kia’s most affordable battery-powered car expected to be launched in the second quarter of this year, Kia plans to add the EV2, EV4 and EV5 to its major markets such as Korea, North America and Europe.

For emerging markets such as India, Kia will debut locally-tailored EVs such as the Carens EV. The automaker underlined that it has set up a manufacturing system at its plant in China to produce vehicles that will be shipped to emerging markets. With the China-based production, the firm aims to increase sales in emerging markets to 250,000 units in 2027 from 80,000 units in 2023.

Kia set forward plans to create new demand for mass sales with PBVs that run on battery-powered electricity. Kia will launch the first mid-sized PBV, the PV5, in 2025, followed by the PV7 in 2027, which will offer the most spacious interior among the PBVs. The company said it expects to sell 150,000 units of the PV5 and 100,000 units of the PV7 in 2030.

Kia maintained its earlier goal of selling 3.2 million vehicles worldwide this year and 4.3 million cars in 2030. However, the automaker upped the target for the sales portion of eco-friendly vehicles composed of EV, HEV and PBV to 58 percent in 2030, up about three percentage points from the goal it had laid out last year.

“After the brand relaunch in 2021, Kia has carried out various changes across all business sectors such as establishing an innovative lineup of EVs and proposing the future of mobility to be centered around customers,” said Kia CEO Song Ho-sung.

“By effectively responding to changes in the automobile market and implementing concrete mid- to long-term strategies, we intend to become a brand that contributes to customers and communities as well as society globally and the environment.”