Kia Doubles ProfitsBy Michelle Krebs April 29, 2011
Kia profits nearly doubled in the first quarter, spurred by sales growth in its domestic market of South Korea and overseas, particularly in the U.S. Kia earned 953.2 billion won ($890 million) in the first quarter ended March 31, up 91 percent from the 498.5 billion won earned in the year-ago quarter. Revenues rose 37 percent; vehicle sales increased 30 percent to 619,000 units sold on the strength of new Optima (above), Sorento, and the minicar -- sold as the Picanto in Korea and the K5 in Europe and China.
Edmunds.com forecasts a strong start for Kia in the second quarter as well. The automaker is expected to report April sales of 43,461 vehicles, up nearly 45 percent from April 2010 for a market share of 3.7 percent, up from 3.5 percent in March and up from 3.1 percent in April 2010. Kias strong financial performance comes on the heels of Hyundai reporting Thursday that its first-quarter profit increased 46 percent. Hyundai owns 34 percent of Kia. Combined, they are the worlds fifth largest automaker in vehicle sales volume.
Kia announced Friday it expected to surpass its previous 2011 sales goal of 2.43 million units due to stronger demand in the U.S., though the automaker said it would be pressed for additional capacity. While the automaker didnt say it, Kia as well as Hyundai are benefiting from production disruptions experienced by Japanese automakers due to the earthquake, tsunami and nuclear plant disasters.