Kia Will Build Small Cars in New Georgia Plant

Kia goes to their Plan B

By Brendan Moore

05.26.2008

Fresh off their announcement a couple of weeks ago that they were canceling plans to build a pickup truck for the U.S. market in their as-yet-unopened new U.S. production plant in Georgia, Kia states they will instead produce a small car at their new factory.

The original plan was for Kia to build a pickup truck in Georgia for themselves and their corporate parent, Hyundai, but the rising price of gasoline and the dizzying fall of pickup truck sales in the American market put paid to that plan. The new plan is to provide a C-class size car to be sold as a Kia and possibly as a Hyundai as well.

However, as it was stated by company officials as Georgia lawmakers were given a tour of the new plant by Hyundai CEO Kim Dong-Jin and other Hyundai-Kia executives, the first order of business is to produce Kia’s Sorento SUV in the plant, starting in November 2009.

During the accompanying press conference, Dong-Jin stated, “Small cars are where we are headed.”

He added later, “We neglected the small-car segment the last few years. We focused on the mid-sized and large to upgrade the brands, but with fuel prices the way they are, we are going back to the mainstream of the business. We are going back to the basics and focus on small cars. We are good at small cars.”

It’s pretty obvious that that decision was driven by the changes in the U.S. market as opposed to some vague desire to get back to the company’s roots, but, hey, who am I to quibble with someone’s rationalization of why they’re going to do something? But, without putting too fine a point on it, Hyundai and Kia are headed back to small cars because that’s where they believe the American consumer is headed. They have come to that conclusion lately just as their competitors Ford, Nissan and Honda have come to the same conclusion. One has to imagine that similar decisions are being reached at every auto manufacturer that sells their vehicles in the U.S.

2009 Kia Soul


Here’s some free advice to Kia: take a couple of those small cars and put the turbo four-cylinder engine from Hyundai’s Genesis coupe in them, and watch your sales figures (and your brand image) get a lot better in a hurry.

Kia Koup concept

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Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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1 Comment

  1. Like they had a choice when the pickup market has just completely crashed in the U.S.

    Not that I think it’s the wrong decision, I don’t, but what other conclusion could they have reached, logically?

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