KIA narrows price gap with Chinese rivals in EU

KIA said it narrowed the price gap with Chinese rivals in Europe this year as Beijing firms accelerated cross-border expansion. CEO Song Ho-sung announced this during Investor Day at the beginning of the month, citing the escalating price war triggered by Chinese competition. Starting this year, Kia has narrowed the price gap for its Chinese-model vehicles from 20-25% to 15-20%, depending on European markets, protecting shares and margins as the industry slows, according to an event log obtained by Reuters. KIA targets Chinese rivals The company says this strategy has helped strengthen its business performance despite a more challenging market. The group, which ranks third in global vehicle sales along with Hyundai, said it had increased its global revenue and managed to offset the wider decline in demand. In parallel, Europe has become a crucial area for Chinese electric vehicle companies: While sales in China are slowing and access to the US market remains complex, exports to Europe are becoming an important channel to support growth. In fact, competitive pressure has pushed rivals to offer discounts and accelerate the launch of more accessible models. The price gap has narrowed in Europe The comparison becomes particularly intense when observing the increase in registrations of Chinese brands in Europe: BYD sales, for example, could have recorded an increase of almost 150% in March; This would far exceed overall sales growth, as well as growth from KIA and Hyundai. KIA itself admitted that it had to respond with commercial incentives, confirming the “two-speed” nature of the industrial duel, but weighing on profits: on the one hand, the need to defend volumes and presence, on the other hand, the cost of competition based on more aggressive prices. Song also predicted a possible acceleration in the restructuring of China’s auto industry, suggesting that companies may have fewer resources to continue expansion as government support wanes.