Kia has aggressive growth plans for the Indian market in coming years
Kia Motors couldn’t have asked for a better start of its operations in India. In just eight months since the launch of its Seltos crossover, the South Korean automaker has surpassed sales of 80,000 units and if it’s not for the ongoing lockdown, things would have been even brighter.
With the strong start and upcoming streak of new product launches, Kia Motors India’s installed annual production capacity of 300,000 units at its Anantapur facility could get saturated as early as 2022. So, the automaker has already started scouting places for a second production plant in the country.
According to Autocar Professional, Kia is exploring its options in different states and Maharashtra looks to be the front runner. The publication reports that the state government has put on the table a lucrative deal as it seeks to attract high-ticket automotive investments. While Maharashtra is home for one of the biggest automotive clusters in the country, it has lost out on the recent significant investments in this sector. Hosting Kia’s second plant would boost the state’s economy as well as generate significant employment opportunities.
As far as Kia is concerned, a manufacturing plant in Maharashtra would have a lot of strategic advantages. For starters, the state has a well established vendor network which will make things a lot easier. With export being one of the key pillars of the automaker’s long term plan, the Mumbai port would come in handy (Kia is already exporting the Seltos from Chennai port).
Kia India is planning to introduce the Sonet sub-4m crossover later this year to compete with the likes of Maruti Brezza, Hyundai Venue, etc. The mini crossover will have India as its sole manufacturing base and Kia expects the model to have excellent export prospects.
Once the mini crossover is up and running, Kia’s attention would turn towards a compact MPV to rival the Maruti Ertiga. The people carrier is expected to be ready sometime in 2021. Given the affordable family MPV segment has a good outlook, we expect the upcoming Kia MPV to be an important volume churner.
Responding to Autocar Professional’s query regarding the site for second plant, Kia Motors stated that the COVID-19 situation is likely to delay the need for increase in production capacity. The company also revealed that it is not currently scouting for a specific place as the Anantpur facility is compatible with a capacity increase to the tune of 100,000 to 150,000 units per annum.