Tag Archive | "Kia Motors Corp"

Kia Motors Says Vice Chairman Jeong Resigned on Sept. 3 After Car Recalls


Kia Motors Corp. said that Jeong Sung Eun resigned as vice chairman of the South Korean carmaker to take responsibility for the recent recalls of four models. President Lee Hyoung Keun will replace him, Bloomberg reported.

Jeong stepped down Sept. 3 after Kia issued a series of recalls worldwide, Michael Choo, a company spokesman, said by phone. Lee was appointed vice chairman, Kia said in a separate statement today.

The resignation highlights increased sensitivity among automakers to quality problems after Toyota Motor Corp., the world’s largest carmaker, recalled more than 8 million vehicles in the past year for problems related to unintended acceleration. Kia’s action was swift and appropriate, said Chae Hee Guen, a Seoul-based analyst at Meritz Securities Co.

“Jeong resigning is a preemptive action,” Chae said. “Quality is a top priority for Kia and Hyundai Motor Co. management. They don’t want to tarnish their image.”

Jeong, a former president of Kia, was in charge of the production division, Choo said. Jeong wasn’t immediately reachable for comment.

Kia, an affiliate of Hyundai Motor, fell 0.2 percent to close at 33,400 won in Seoul trading, while the benchmark Kospi index dropped 0.3 percent.

South Korea’s second-biggest carmaker is recalling about 85,900 vehicles worldwide because of a wiring problem that can cause fires, Kia said in an e-mailed statement yesterday.

Kia will recall about 36,000 Soul compacts; 33,000 Sorento sport-utility vehicles; 8,000 Mohave SUVs; and 8,900 Cadenza sedans, the company said. The vehicles were made between September 2009 and July this year, the carmaker said.

The company will recall another 18,147 Sorento, Borego and Soul models in China because of problems with circuit boards, the General Administration of Quality Supervision, Inspection and Quarantine said in a statement on its website yesterday.

Posted in Auto Industry NewsComments (0)

Kia Recalls 56K Souls, Sorentos in U.S., S. Korea


DETROIT/SEOUL — Kia Motors said on Friday it had started a recall of some 56,000 Soul and Sorento vehicles sold in the United States and
South Korea due to defective wiring harnesses that could cause fires, Reuters reported.

Some harnesses supplied by Johnson Controls for lighting in 2010 model-year Soul cars and 2011 model-year Sorento SUVs were
improperly soldered, leading to possible electrical shorts, Kia said in a letter to U.S. safety regulators on August 30.

There were no reports of accidents or injuries due to the issue, which was identified in June, said Kia, an affiliate of South Korea’s Hyundai Motor Co. Kia determined that a recall was needed on August 23.

Through August, Kia Soul sales had more than doubled in the United States to nearly 44,000 from the first eight months of 2009. The Soul has been marketed to the same younger drivers targeted by Toyota Motor Corp’s Scion brand.

Kia will replace the wiring harnesses, it said.

The U.S. recall covers 23,972 Soul cars produced from September 7, 2009, through June 8, 2010, and 11,213 Sorento vehicles built from October 23, 2009, through July 30, 2010, according to the notice filed with the U.S. National Highway Traffic Safety Administration.

In August, NHTSA launched a probe into possible steering defects in the 2010 model-year Soul after a driver said a steering shaft detached from the steering wheel in a two-month-old vehicle and fell onto the driver’s side floor, causing a complete steering loss and limited braking.

NHTSA also has opened a preliminary probe into possible steering problems in the 2011 model-year Hyundai Sonata sedan, a key introduction for the automaker and its best-selling vehicle in the United States.

Posted in Auto Industry NewsComments (0)

Kia Motors Profit Jumps 61%


SEOUL — South Korea’s Kia Motors Corp. Friday trounced estimates to post a 61 percent jump in second-quarter net profit, increased its forecast for global sales to over two million units for the year and announced it will launch new vehicles to spur demand, reported The Wall Street Journal.

Brisk sales of new models helped net profit rise to 557.8 billion won ($472 million) in the three months ended June 30, up from 347.1 billion won a year earlier. Net profit for the first six months of the year more than doubled to 956.3 billion won from 444.5 billion won during the same period a year earlier, the company said in a statement.

Kia’s net profit was expected to rise 36% from a year earlier to 472.7 billion won, according to the consensus forecast by analysts according to Seoul-based market research firm FnGuide.

The better-than-expected results sent Kia shares 2.3 percent higher to close at 30,900 won Friday, as investors overlooked the impact of a possible labor strike on the carmaker’s third-quarter earnings.

Kia, which together with Hyundai Motor Co. forms the world’s fifth-largest car maker by sales, had earlier set a target of 1.94 million units in global sales for 2010. It achieved 52 percent of its target by selling 1,004,000 units in the first half, leading to a revision of the target.

The company said it plans to strengthen its overseas marketing and sales with new products. “Kia will launch the K5 midsize sedan and the Sportage R sport utility vehicle in overseas markets late this year in order to excel the sales target,” the statement said.

Second-quarter operating profit climbed 28 percent from a year earlier to 423.7 billion won from 330.3 billion won, while sales were up 23 percent to 5.768 trillion won from 4.676 trillion won. First-half operating profit jumped 75% to 733.5 billion won and sales rose 30 percent to 10.629 trillion won.

However, analysts struck a cautious note, saying third-quarter operating profit may be similar to the year-earlier level of 330 billion won due to a possible strike during this year’s wage talks. Fewer working days due to summer holidays, which usually stretch from July through August, and the Korean Thanksgiving holidays in September will also likely damp profitability.

Last month, Kia’s union members voted for a possible strike if the company doesn’t accept their demands during the wage talks, in which they also want to discuss the issue of cutting the number of paid union executives. However, the company wants the issue of paid union executives to “be discussed separately from the wage deal.”

A union spokesman had told Dow Jones the union will decide on whether to go on strike or not, depending on the company’s attitude toward the “thorny” issue early next month, when they come back from summer holidays. Under revised labor laws, companies that have paid union executives are allowed to cut the number of those executives if they aren’t involved in manufacturing jobs.

“Still, improved utilization rates and addition of new cars to major markets will offer a strong catalyst to Kia in the fourth quarter,” Song Sang-hoon at Kyobo Securities said, forecasting a full-year operating profit of 1.409 trillion won and sales of 21.268 trillion won for this year.

Posted in Auto Industry NewsComments (0)

Page 3 of 3123