South Korea's Hyundai, Kia expect slowest sales growth in 10 years
By Hyunjoo Jin
SEOUL (Reuters) - South Korea's biggest automakers Hyundai Motor Co (005380.KS: Quote) and affiliate Kia Motors Corp (000270.KS: Quote) are targeting a 4 percent increase in global sales this year to a combined 7.41 million vehicles, their slowest growth since 2003.
The duo, which together ranks fifth in global car sales, is bracing for more modest growth after years of expansion at breakneck speed. Group chairman Chung Mong-koo has slowed capacity building to focus on improving branding and profitability in the hopes of better competing with rivals that include Japan's Toyota Motor Corp (7203.T: Quote).
Hyundai Motor and Kia will pursue brand innovation by raising the quality of our vehicles, Chung, the 74-year-old chairman of Hyundai Motor and Kia's parent group, said in his annual speech to employees on Wednesday.
In line with that strategy, Kia promoted chief designer and executive vice president Peter Schreyer - known for his design contributions to the iconic Audi TT - to president late last week.
Earlier in 2012, Hyundai Motor poached ex-BMW designer Christopher Chapman to head its U.S. design center.
"Chairman Chung said our maximum capacity is 8 million vehicles. No more than that. Instead, he said we need to move upmarket and raise margins," a former top Hyundai executive told Reuters.
Hyundai Motor plans to unveil a luxury-concept vehicle at the upcoming Detroit motor show, a spokesman said, without elaborating.
The auto maker targets sales of 4.66 million vehicles this year, while Kia has set a goal of 2.75 million, according to regulatory filings. Continued...