Kia has future in its sights
Martin Brennan reports on the growing rivalry between Korean car maker and its rivals in small family car segment
Published 23/10/2011 | 05:00
Kia has the Toyota Yaris in its sights as the new third generation Rio hits the forecourts this week. James Brooks, MD of Kia Motors Ireland, believes that the Yaris, number two in the sales charts behind Ford's Fiesta in the small family car segment, does not compete with the Rio in terms of value for money.
"Toyota customers are paying too much for too little," he said at the launch of the new model.
To illustrate his point, he said that the top level Rio EX offered air conditioning, fog lights, rear electric windows and alloy wheels for €16,495 -- items which are only found in the top Yaris model, the Sol, which has a price tag of €18,210 (and includes a reversing camera, touch screen and dual climate control). And he stresses Kia offers a seven-year warranty compared to three years for most rivals.
The top seller Ford Fiesta, as well as Renault Clio, VW Polo, Nissan Micra, Opel Corsa and Seat Ibiza, are also targets for Kia.
There will be fierce competition in the coming year with sales expected to plummet by as much as 10,000 units. Mr Brooks's forecast is for 78,000 new car sales next year, with this year's final figures expected to come in under 90,000.
The new Rio has electronic stability control as standard and there is hill assist, emergency stop lights, Bluetooth and iPod connections, six airbags and fold-away mirrors. The side-impact protection has been improved and there is now a stronger body shell. The first model to go on sale will have a 1.2 litre 83 PS petrol engine with 5-speed transmission. In a short test drive, it proved to be lively and responsive.
There is also a 1.4 litre 89 PS diesel option with 6-speed transmission, but Kia does not initially intend to offer their 1.1 litre diesel which has been lauded for putting out only 89g/km of C02 and which can return 88 mpg.
"It is there if we want it but petrol engines are the big sellers in this end of the market," Mr Brooks says.
The entry price of the Rio is the LX version at €15,295 and the diesel option will sell at €17,895. Kia expects the EX model to be the big seller, reasoning that the punter prefers better kitted out cars.
Both models are in the Band A tax bracket with an annual road tax currently standing at €104 a year, but there are fears that this may increase in the Budget. There is also speculation that VAT may increase by 1 per cent early next year.
Mr Brooks says that the motor industry is hoping the Minister for Finance does not interfere with the current VRT rates, which would pose great problems for importers at this time of the year.
"There are a lot of empty showrooms around the Naas Road and there are a lot of dealers hanging on by their fingertips," he warned.