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Kia steps into retailing with new strategy

Low volume carmakers are acquiring key city centre sites to run as wholly-owned showrooms following the trend set by Mercedes-Benz, Renault and Ford.

Kia Motors UK moved into retailing with the takeover of Bolton Kia from the collapsed Hanover Automotive group, while Daewoo bought back four sites. Now Kia plans to invest in other urban locations where independent franchisees are difficult to find.

Managing director Paul Williams claims the acquisition is part of a wider retail strategy. “We intend to intervene in key areas where we are not able to link-up with existing franchise

holders,” he says. “Locations will be chosen where it is essential to get directly involved in order to fuel future growth.”

While Kia has set no limit on the number of dealerships it plans to own, it needs to boost network coverage in time for the new city car. Unveiled at next week's Frankfurt show, the car, badged Visto in the Korean market, will be positioned below the Focus-sized Rio. Kia sales are up 85 per cent on 2002 to 6540 units year-to-date after the Korean factory took control of UK distribution from MCL last year.

Other carmakers have ruled out similar moves. Mazda has a number of open points, but UK managing director Phil Waring says: “I do not want to own dealers – we should recognise what we are good at and recognise what dealers are good at and let them get on with it.” Perodua, which used to run a multi-franchise site in Newcastle in a venture with European Motor Holdings, also rules out similar action.

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