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KIA is preparing an emergency plan to counteract the Trump effect

Kia Forte Pesquería (Nuevo León)

Kia Motors (and its sister Hyundai) is one of the brands of cars that greater number of sales is recorded in the United States. Its growth has been rapid in recent years and with the opening of their factory in fishery (new León, Mexico) seemed that everything was going to go to best. However the arrival of Donald Trump to the Government of the United States could do that smoothly carrying the South Korean firm in the American country look braking of coup.

Currently Kia only manufactures the Forte in Mexico, but its rate of production is very high since this year expect to increase it to 250,000 units. The problem comes in the future addition of models to the production of this new plant lines. The reason is that the firm had planned that fishery was to become one of the most important in the world production centres. Therefore if the products that are manufactured there have as main market the United States the thing changes, and more if running tariffs of 20 percent to products manufactured in the Aztec country.

Fabrica de Kia en Eslovaquia

To try to counter the threats of Trump Kia managers have reported that they are preparing an emergency plan. Han Chun-soo, Chief Financial Officer of Kia, has reported that the uncertainty that there is about Mexico and United States is very large and the companies operating between the two countries could be heavily damaged if the economic and diplomatic situation is not treated with due delicacy.

The main line of action that would pick up this emergency plan would go through the entrance or consolidation in markets that are not present. This could spread the production of its Mexican factory to other countries that do not have this tax burden and therefore kept their prices at Bay. In addition, this plan would also have another line and is not more than the expansion of the range of products of the firm towards the small SUV segment; in other words, the arrival of the new Kia Rio SUV that will reach the market soon.

Source-Kia Motors

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