Kia India is currently in its third year of operations in the Indian market. Now, reports suggest that the carmaker has already turned profitable in the Indian market. The South Korean car manufacturer has even set an example for most incumbent car makers in the Indian market who were not able to achieve the feat. This shows that if the business strategy is right, carmakers can make profits in the Indian market.
According to reports, Kia India recorded INR 1,111 crore profit in the Indian market. Kia recorded the profit for the end of the year in March 2021 against the loss of INR 329 crore in FY20. Despite the COVID-19 pandemic that badly hit the car industry, Kia’s total turnover rose by 87%, which is INR 20,290 crore in the last fiscal year. This is equivalent to 10% of the total estimated revenue of the entire car industry. Kia’s volume sales also grew by 90%, with 196,000 units in FY2021.
Kia two most popular products, the Sonet and Seltos, are responsible for recovering more than half of the total capital investments in the Indian market. Thanks to the optimal plant utilisation, the brand has been able to grow its revenues by 80% and profits by 400%. The brand’s revenues are near 30% of the automobile leader Maruti Suzuki in the Indian market.
It is also half of its parent company Hyundai, which is currently on the number two spot in the top automobile companies in India. Also, the net profit of the company is close to 26% of Maruti Suzuki. The company has a pending order book of nearly 50,000 units which it plans to deliver in the next three months. Kia also plans to launch a new model (KIA KY – Codenamed) in the Indian market by 2022.
Kia’s success has come at a time when global automobile giants GM and Ford exited the country.
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