South Korean multinational automotive manufacturer Kia will be investing about $26 billion in its car manufacturing facilities and future mobility technologies by 2025.
Kia will invest $16.8 billion for increasing its profitability in the existing car manufacturing business and $8.9 billion in developing business opportunities through investments in future mobility technologies, the automobile manufacturing company stated at the 2021 CEO Investor Day event.
The manufacturer of the K5 sedan and the Telluride SUV stated that it will also make efforts to enhance its corporate competitiveness and shareholder value in the coming six years. For this year’s earnings guidance, the South Korean company has set a profit target of $3.1 billion on sales of $58 billion. Last year, it recorded an operating income of $1.86 billion on sales of $53.17 billion.
Kia also targets to attain an operating profit margin of 5.4 percent in 2021, up from 3.5 percent last year, while targeting higher margins of 6.7 percent in 2022 and 7.9 percent in 2025. The company has recently changed its corporate name from Kia Motors Corp. to Kia Corp., indicting the brand deviating from its traditional manufacturing-driven business model. It also changed its brand slogan from “The Power to Surprise” to “Movement that inspires.”
“We are breaking away from our traditional manufacturing-driven business model and expanding into new and emerging business areas by creating innovative mobility products and services that meet customer needs,” Kia President Song Ho-sung stated earlier this year.
Kia is also planning to increase its electronic vehicle (EV) lineup with 11 models, including seven all-electric ones by 2026 as it seeks to sell 1.6 million environment-friendly vehicles in 2030. The company will launch its pure-electric crossover model based on a new EV platform named the electric-global modular platform (E-GMP) in the first quarter of 2021.
The new vehicle with the project name of “CV” will be the first global model to bear Kia’s new logo. The new model comes with a battery that provides an electric driving range of over 500 kilometers and a fastest charging time of fewer than 20 minutes.
Kia aims to achieve a 6.6 percent share of the global battery-powered EV market by 2025 and global annual sales of 500,000 units by 2026. The company’s current EV market share is not revealed as its EV sales accounted for only 1 percent of its overall sales in 2019.
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