Having been in his role as head of fleet and remarketing for 11 years, John Hargreaves has been able to watch the Korean brand change out of all recognition with their cars being attractive across the market.
The result this year, is that strong fleet sales are helping Kia to meet its sales goals for 2022.
Hargreaves is keen to tell me that Kia’s strong sales in retail and fleet are down to a number of reasons.
He says: “We have had better availability of product than most manufacturers, we’ve had significant new launches – we launched the Sportage, obviously. We have also maintained our presence in all the major fleet channels. So, while we’re not a major player in rental year in and year out, what we have done is kept the amount of volume that we’d supply to the rental companies, constant.
“We’ve not really upped our volume, but our share of rental has increased as the others have withdrawn from it altogether. We’ve taken the view that we wanted to keep the rental companies very much part of our partnership arrangement. So, we’ve maintained that and likewise, Motability. We have increased our pricing for Motability, but we haven’t withdrawn from it.
“Over the period of the next few months, we will scale down a little bit – some activity in some of the channels with some of the cars. We’ve done well because we’ve kept a presence in all sectors of the fleet market and the dealers have supported that.”
Hargreaves is also keen to acknowledge that Kia was in a better position than other manufacturers with the chip crisis.
He says: “As far as the chip crisis is concerned, we did quite well with chip supply, and it took a long time before our supply was hampered by the lack of chips.
“We are starting to find now that some of the models and derivatives are getting harder to order, with longer lead times and because of that there are one or two models that are quite scarce now.
“We certainly seem to have a good bank stock of components, which enabled us to keep going normally for a long time, although DCT automatics, and some of the smaller cars that come from the Korean factory are getting harder. Including one of the Ceed engine model types – the 1.0-litre.
“We’re in the same position as other manufacturers in terms of the supply of electric cars, with an estimated six-month wait for an EV6, although there is a slight variance with colour choice.”
With recent launches focussing on EV drivetrains, Hargreaves is pleased to say Kia is in the fortunate position of having all the other powertrains.
He says: “So we’re not having to push one in front of another. We are still saying to fleet customers, if you’re doing a certain type of driving, then an EV might not be the right thing for you. We’re still seeing more and more people choosing electric cars – but not to the exclusion of petrol and diesel.
“We’re fortunate, we’ve got HEV, PHEV, then EV and obviously petrol and diesel. Although certainly the mix and balance will change. Obviously all EVs are a good fleet car, because of the low BiK.
“Niro is now available, although we’re going to try to supply that as a retail car predominantly at the start. Then, once we get full supply, it will be for all channels. I think it will be a similar six-month wait as the EV6, for the Niro EV.”
Hargreaves believes that after the Soul and Niro EVs, the EV6 is very much a conquest model.
He says: “I think there’s no doubting that EV6 is another level, so we’re converting from cars like the Jaguar i-Pace, rather than existing Kia electric cars.
“The EV6 sales split is currently around 65% retail and 36% fleet.”
So, with such a large selection of Kia hybrid and EV models already available, Hargreaves must be confident in the brand’s position as we move towards 2030.
He says: “Certainly confident, but not smug, I would say. I think we would recognise that whilst we’re ahead now, probably in terms of availability and quality of models, there will be a time when that balance of availability will shift.
“We are confident we will do a record sales volume this year and we plan to grow beyond that. We are also confident we have the products to support it.
“I think we also recognise that we’ve had an unusual market position this year, that we’ve capitalised on. We’re going to have to work very hard on ourselves and with the dealers, to keep things going forward – it’s not something we can just expect to grow without us working on it.”
EV might be getting all the attention, but I ask Hargreaves how the powertrain mix has changed over the past year?
He says: “The powertrain split within fleet is currently 25% EV, 20% PHEV and Hybrid, and 55% ICE. This hasn’t changed much in the past year, but supply will play a big part in that.
Hargreaves explains the holy grail for Kia in fleet, is two-pronged.
He says: “It’s for the dealers to ballot their own local business market, which is always an extensive opportunity. Plus, genuine User-Chooser fleet business, where people typically have an amount of money per month to spend and because of the appeal of the car – they choose a Kia, rather than us necessarily tempting them on price.
“You’ve obviously got to be competitive, and we also do plenty of deals where we supply several cars into fleet for commercial use – a Service Engineer for example, or public sector usages. They tend to be higher discount type of situations, but we’re still very interested in doing them.
“I think we’re doing well because we like all parts of the market – we’re trying to do everything in balance, rather than being over indexed in one and not doing enough in another. So, we’re trying to almost mirror the overall market in terms of where our car numbers are.”
Hargreaves is keen point out that Kia is a nimble company, but at the same time they must stay consistent in the fleet market.
He says: “We don’t want to be dipping in and out of the market. We might be looking at reducing numbers on a few product lines, but in general we’re going to focus on doing what we’re doing for the rest of the year, which is trying to fish in all the fleet ponds.
“Niro will also be a strong opportunity for us this summer and early autumn. We’re going to do a series of regional road shows for fleet and that will be a big feature for us.”
