Kia Motors to invest $25 billion in electrification and mobility solutions
The manufacturer has unveiled its 'Plan S' strategy to offer a full line-up of 11 battery electric vehicles by 2025
Kia Motors Corporation has announced details of ‘Plan S’, its mid- to long-term strategy aimed at progressively establishing a leadership position in the future automotive industry, encompassing electrification and mobility services, as well as connectivity and autonomy.
The Plan S strategy outlines Kia’s preemptive and enterprising ‘shift’ from a business system focused on internal combustion engine vehicles toward one centered on electric vehicles and customized mobility solutions. The company’s ongoing brand innovation and profitability enhancement will support the two-track Plan S strategy targeting the shift toward electric and autonomous vehicles as well as mobility services.
As the two strategic objectives of Plan S, Kia will concentrate on (1) leading the popularization of electric vehicles, and (2) expanding mobility services for electric and autonomous vehicles, as well as entering the PBV business.
By the end of 2025, Kia plans to offer a full line-up of 11 battery electric vehicles. With these models Kia is looking to achieve a 6.6% share of the global EV market (excluding China), while also attaining a 25% share of its sales from its eco-friendly cars. With the global EV market expected to gain strength by 2026, Kia is aiming for 500,000 annual EV sales and global sales of 1 million eco-friendly vehicles (excluding China).
Plan S will see Kia Motors invest a total of 29 trillion won (US $25 billion) by the end of 2025 to establish leadership in vehicle electrification and diversify its business. By the end of this period, Kia Motors is targeting a 6% operating profit margin and 10.6% return on equity (ROE) ratio to secure the necessary capital and maximize shareholder value.
“As the auto industry undergoes turbulent changes, today is also an opportune time for Kia Motors to radically transform itself into a global enterprise dedicated to spearheading customer value-led innovations,” said Kia Motors President and CEO Han-woo Park. “Kia Motors will actively innovate to take on the challenges ahead, identifying and capitalizing on new opportunities to propel the company forward.”
CEO Park added: “Plan S is a bold and enterprising roadmap for Kia’s future business transition, buttressed by the two pillars of electric vehicles and mobility solutions. Our approach is to put customers first, and Kia will reinvigorate its brand innovation by developing products and services that offer new experiences for customers.”