Dongfeng Yueda Kia, no, it should be called Yueda Kia now, is there still a chance? This may be the biggest question facing Yueda Kia after Dongfeng completely withdraws.
According to the latest reports, Kia will announce the new company name under the IPO structure at the Beijing Auto Show in April 2022. As for the name of the new joint venture, the industry speculated that it would be renamed "Yueda Kia" or "Kia China", but it has not been confirmed.
In this regard, the industry generally believes that Kia has experienced many turmoil in 2021, Dongfeng withdrawal, equity changes, Liu Changsheng succeeded Li Feng caused by high-level turmoil, Kaiku, the new generation of smart running sales are not good, the fourth generation of Jiahua with high hopes for more than three months of average monthly sales of only about 600 units, and even in December due to product defects recalled, it can be said that Yueda Kia was discredited, but also let Yueda Kia's 2022 cast a thick shadow.
Didn't Yueda Kia have any chance at all? Not so much, the industry believes that 2022 may be Kia's last chance, if it can no longer rebound, it may really slowly edge, until it withdraws from the Chinese market.
On the one hand, Kia's determination to localize the Chinese market needs to be strengthened. At present, Kia still has a considerable market share in the world, but in China, the largest automobile consumer market, Kia is very weak, the reason is that localization is not enough, especially localization management is very hesitant.
Kia has also tried. In September 2019, Li Feng became the first Chinese CEO of Dongfeng Yueda Kia, which is considered to be a manifestation of Hyundai Kia Automobile Group's firm localization development. Kia's attempt has also received good results, and the data shows that in the full year that Li Feng took charge of Kia, Dongfeng Yueda Kia sold 249,000 vehicles in 2020, and maintained positive year-on-year growth for many consecutive months. In addition, revenue in 2020 increased by 2.6% year-on-year, and profitability was greatly improved. At the same time, the average unit price of models reached 128,700 yuan, an increase of 21,000 yuan year-on-year.
At that time, the industry was optimistic about Li Feng, and agreed that as long as Li Feng was given enough time, Kia could fully obtain the re-emergence of the brand. However, just a year later, Lee was transferred and his position was again replaced by South Korean Yoo Chang-seung.
For this personnel change, including many people within Dongfeng Yueda Kia, they feel sorry for it, and they are also full of doubts about Kia's management system - is Kia really determined to localize the brand? Can't Chinese, a Korean. In fact, after Li Feng was transferred, the sales volume of Dongfeng Yueda Kia fell sharply again, which also proved the negative impact of personnel changes on performance.
Although after Liu Changsheng took office, he still constantly emphasized that Kia would unswervingly implement the localization strategy, but judging from its measures in the past year, there has been no substantial progress, and even Kia dealers have doubts about it. According to media reports, a considerable number of Kia dealers believe that Li Feng's step-by-step measures are effective, and they also let the dealers see hope, but due to Kia's eagerness for results, they have changed coaches many times and changed their strategies frequently, which not only failed to make the brand shape enough influence, but also made the system dissatisfied with Dongfeng Yueda Kia.
It can be seen that if Liu Changsheng cannot quickly make Kia's localization strategy effectively land, Kia will still not be recognized in China, and its brand power will further decline. What is more pessimistic is that if Kia is dissatisfied with Liu Changsheng and makes a new round of adjustments to the top level of Yueda Kia, it may accelerate the uneasy factors within Yueda Kia.
On the other hand, Kia's high-end strategy needs strong product support. As we all know, when Li Feng first took office, he announced that Dongfeng Yueda Kia would not launch models below 100,000 yuan. Under this declaration, Kia's products launched in China in the past two years, Kaiku, the new generation of smart running and the fourth generation of Jawa are the main high-end positioning. However, Kia's high-end strategy seems to be still stuck in the price of the rise.
I still remember that when Dongfeng Yueda Kia listed the fourth generation of Jiahua in September 2021 at a price of 288,900-339,900, "Why does Kahua sell so expensive" has become a hot topic of discussion in various forums. Consumers' hot discussion of the price of the fourth generation of Jawa reflects the market's doubts about the premium ability of the Dongfeng Yueda Kia brand, and is also the consumer's disapproval of the fourth generation of Jawa's product strength.
Sure enough, the fourth generation of Jiahua did not achieve good market sales, and the total sales of 2200 units in 2021 also proved that its pricing was not consistent with its product configuration, coupled with the quality problems that had been exposed and the recall incident initiated by Kia, which made consumers complain about Kia's so-called high-end.
"It's normal to have a high-end dream, but without a high-end product, the high-end can only be a dream." Consumers are on the spot.
Moreover, it is worth noting that when Dongfeng withdraws, Kia may take over the original equity of Dongfeng, if it comes true, then Kia will have "absolute pricing power", then Kia's high-end dream may further increase the price of its products, and trigger consumers to consider exiting.
It can be said that although Kia has repositioned its strategy as a mid-to-high-end market, it is difficult for it to support such a plan in terms of sales performance and brand reputation.
Finally, it should be mentioned that Kia's new energy layout has not seen results for a long time, which will also make Kia's 2022 more difficult. Although Kia has said that it will launch a new electric vehicle into the Chinese market by the end of 2022 and guarantees that it will introduce an electric vehicle every year thereafter, thereby accelerating the electrification layout, but for the current Chinese new energy market, it is already too late. In 2022, Kia's electrification strategy will face the double encirclement of Chinese brands and other joint venture brands, can Yueda Kia, which is not strong enough, get a piece of the pie? Hard.
I have to say that Kia's former glory in China has come to an end, and where Can Yueda Kia can go, Kia must put down its posture. How much South Korean Yoo Chang-seung can do in the Chinese market, from the current measures, there is little hope. At present, the market has left Kia with a very limited opportunity for trial and error, and the fate of Kia in the Chinese market in the future may only be the last bet in 2022.
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