Kia Corp. unveiled a compact electric sport-utility vehicle and two concept EVs as it builds out a range of cheaper models to appeal to budget-conscious drivers.
Kia debuted the EV5, pitched at millennial families, at a so-called EV Day on Thursday. For the Chinese market, the standard model will come with a 64 kilowatt-hour battery offering 530 kilometers (330 miles) of range, while the long-range model’s 88kWh battery will get 720 kilometers per charge. The Korean models will have slightly smaller batteries and the driving range will be tailored to market demands, the company said.
The EV5 comes with two 12.3-inch (31-centimeter) screens for instrument displays and infotainment, and a 5-inch climate control display. The Chinese version will have a front bench seat, while the rear seat can be folded flat to transform into a bed. There is also a 4-liter (1.1 gallon) refrigerator and warming unit for storing food and drinks. The cars will be made at factories in China and Korea, with production starting around 2025.
Kia also displayed two concept cars — the EV3, a compact version of its flagship EV9; and the EV4, a four-door sedan that looks more like a sports car. The three models are part of Kia’s plan to introduce smaller EVs ranging in price from $35,000 to $50,000 to accelerate the widespread adoption of battery-powered cars, the company said. Top-end models will go for up to $80,000.
Kia last month introduced its cheapest EV — the single-seat Ray, which starts at $20,000 and is only available in Korea.
Tesla Inc. started selling its Chinese-made Model Y SUV in Korea earlier this year, priced from about 57 million won ($42,550). With government subsidies, the price drops to about $37,000 in Seoul and as low as $30,000 in some cities that offer extra incentives for EVs.
Smaller EVs are Kia’s “entry to the segment of customers” who look for affordable electric cars with lower prices and charging convenience, Chief Executive Officer Ho Sung Song told reporters at the EV Day, held in Yeoju city, southeast of Seoul. The automaker aims to sell 1.6 million EVs by 2030.
To meet that target, Kia plans to have eight production facilities by 2025. In Europe, the company will focus on making small- and medium-size EVs, while it will produce mid- and large-sized vehicles in China. In India, it will focus on “strategically designed EV models tailored for emerging markets,” Song said, without elaborating.
Kia has to study “very deeply” how to cut EV prices further, he said. “This is very important for us; how we can make the vehicles below around $25,000 in the market.”
“Maybe in the future, we need some different sales strategies,” such as selling vehicles without a battery, which buyers can then rent, he said.
Prices of batteries, the most expensive part of an EV, are expected to fall to $99 per kWh by 2025 as technology improves and new lithium reserves are developed, according to an Oct. 4 report by Goldman Sachs Group Inc. analysts led by Kota Yuzawa. He upgraded Kia’s stock to a buy on improving margins as battery costs decline.
Kia and affiliate Hyundai Motor Co. sold around 374,000 EVs in the first eight months of 2023, ranking seventh globally, according to a report from SNE Research. Their combined market share of the global EV market, including electric and plug-in hybrid vehicles, has fallen to 4.3% this year from 5.4% in 2022, due to the strong growth of China’s BYD Co., the research group said.
Song said Kia may introduce a compact model EV2 in Europe. The European Union has started a probe into China’s EV subsidies, which could result on tariffs being imposed on made-in-China cars and potentially benefit the Korean firm.
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“EV2 is very unique, very important model for European market,” he said. “EV2 is very European style and it will be produced in Europe.”