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Kia aims at the US market for its new Soul EV

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The article “Kia Soul EV’s top market will be U.S.” from automotive news explains how Kia plans to make the US their major market for the new electric Soul. By expanding their production and through couple government incentives they plan to be able to cut their price to almost half of what is now being sold by in South Korea.

I found really interesting to see an Asian firm aiming to have their largest sales in the US, after all the case studies we have read in class and all the forecasts from other companies that they aim to have their largest sales in Asia, or more specifically in China.

Why would they do this? One of the possible answers is that this is due to the nature of the car. Being an electric vehicle with high production costs, the only way to increase sales would be by having low prices after government subsidies. With China’s ‘driving population’ growing, and their air pollution problem, this scenario could change if the Chinese government finds electric vehicles to be a good solution to improve the air quality in major cities.

The other interesting perspective is that this situation is similar to what happened when Toyota, Honda and other small cars manufacturers entered the US market, that combined with increasing oil prices they sent some of the major US brands to bankrupt. Is Kia taking advantage of a gap in the market for small electric vehicles? How are the US car manufacturers going to react? In previous Auto Shows that Ford and GM have been developing electric vehicles, will this encourage them to start selling them in the local market?



One Comment

  1. See my comment on a more recent Tesla article on the slow implementation in China of policies to promote electric vehicles. The US remains the target, thanks to the zero emissions mandate in California, under which those who are far from that level can reduce fines for exceeding emissions standards by buying credits. That’s the only thing that keeps Tesla from being a financial disaster, instead of merely a slow bleed.

    May 12, 2014

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