To focus on brand positioning, after sales service: KIA President

Interview with Han Woo Park

Last month, Korean car major Kia announced plans to enter the Indian market with an investment of $1.1 billion in a manufacturing in Andhra Pradesh, which is slated to begin production in 2019. 

Han Woo Park, President at the Seoul-headquartered company, tells Ajay Modi in an e-mail interaction that the company is doing a feasibility study for vehicles including SUV and sedan. Park, who spent three years as MD & CEO of Hyundai (Kia's parent company) in India, said it will focus on a differentiated brand positioning and strong aftersales to gain volumes in the world's fifth biggest car market.

What factors related convinced Kia that this is the right time for India entry?

The Indian market is expanding rapidly, and presents Kia with an opportunity to secure further sustained growth. The infrastructure in India supports car manufacturing and will develop and expand even further in the coming years. We have been busy in recent years establishing a strong manufacturing presence in the strategic markets of China, Europe, USA and Mexico. Now that we have succeeded in doing so, we view India as the next untapped market with huge potential.

How does the company perceive the competition and domination from top two-three players? Does it make things more challenging?

We believe differentiated brand positioning, along with differentiated products, is the key to success, especially during the initial sales phase. However, our study into the Indian market is still ongoing, it is a little bit early to announce our entry strategy at this point. We are confident that our comprehensive preparation and execution strategy will result in a successful launch of the Kia brand in India.

Why has the company decided to start with compact sedan and compact SUVs? Does it not find the entry segment here attractive enough?

We are still carrying out a feasibility study into a number of vehicles for production including a compact SUV and compact sedan. We are still in the process of detailed planning for the India plant and plan to announce the details in due course.

A number of overseas players here have made India an export base as well, including Hyundai. Has Kia not considered this possibility?

We are mainly focused on the local Indian market, with dedicated cars for Indian customers. We have not determined plans for exports at the current time.

What synergy will Kia draw from the presence of Hyundai in India? How will the two brands compete here?

There is potential for Kia to benefit from the existing infrastructure and logistics operations established by Hyundai. Hyundai's Chennai plant is 390km away from the location of our new Anantapur site, and this proximity between the two facilities will benefit both of us in terms of logistics and econommies of scale.

What kind of sales and service network is being envisaged to sell the 300,000 cars in India?

The numbers and locations of Kia dealers will strongly depend on our sales targets, which will be communicated later. We will announce our plans for an Indian dealer network in the near future; we will focus on major cities during the launch phase. We are also aiming to provide the best aftersales experience in the Indian market and we will continue to review the best warranty conditions for the Indian consumers.

India has seen lot of activism against diesel vehicles. Given this background, how will you plan production?

We will continue to study market demand to satisfy Indian consumers.