Kia, a sister company of Hyundai Motor Co., will launch the Thai subsidiary on Jan. 31 to oversee local operations, including direct sales, marketing and after-sales services, people familiar with the matter said on Tuesday.
Kia has been selling its vehicles in Thailand through a local agent. Kia will soon announce details, including planned paid-in capital, the subsidiary’s name and the business starting date, sources said.
Separately, the Korean automaker is looking into the possibility of building a car manufacturing plant in Thailand to strengthen its position in the local EV market and support the Southeast Asian country’s electrification transition, according to KED Global.
If built, the factory will be Kia’s first ASEAN, or the Association of Southeast Asian Nations, production plant.
The company currently has production sites outside Korea in the US, China, India, Mexico and Slovakia.
Last week, Thailand’s Electric Vehicle (EV) Board approved the second phase of the government’s EV Package, known as EV 3.5, to promote its EV industry’s steady growth and to facilitate investment opportunities in EV manufacturing in the country for new players.
Under the program, foreign automakers must produce three EVs in Thailand for every electric vehicle they import to the country for sale (this is why Chinese EV brands are selling very well in Thailand right now).
Hyundai Motor Group already has a direct presence in Thailand through the Hyundai brand with local sales last year estimated at around 3,500 units, mainly Staria MPV as well as Creta compact SUVs and Stargazer compact MPVs.
Kia sales so far have been carried out by a local importer and distributor with around 1,000 Bongo trucks and Carnival MPVs combined estimated to have been sold in 2023. The new subsidiary was expected to focus more on battery electric vehicles (BEVs).
Did you know that Thailand is one of Southeast Asia’s largest automobile producers and exporters, with its EV sales accounting for nearly half of all EVs sold in Southeast Asia in the second quarter of 2023.
The country is offering generous state subsidies and tax incentives to carmakers intending to convert one-third of new cars to EVs by 2030 in the country.
As part of the plan, Thailand is offering up to 150,000 baht (USD4,270) in subsidy per electric car to foreign automakers with local production plans as well as slashing import tariffs by 40 percent.
