(ATTN: UPDATES with executives' comments, more details throughout)
By Choi Kyong-ae
SEOUL, July 13 (Yonhap) -- Kia Motors Corp., South Korea's No. 2 carmaker, has added a new subcompact sport-utility vehicle (SUV) to its lineup as it strives to boost sales, the company said Thursday.
The Stonic subcompact SUV went on sale in the domestic market and comes as the automaker strives to absorb growing consumer demand for crossovers amid a global economic recovery and low oil prices.
"The B-segment SUV market has grown more than five times in the past five years (since 2013) to 110,000 units in South Korea. The Stonic is geared to attract customers in their 20s and 30s, who tend to prioritize price and fuel efficiency," Kia Motors President Park Han-woo said in a press conference.
The company has received about 1,500 pre-orders and aims to sell 1,500 Stonics a month domestically this year. It counted SsangYong Motor Co.'s Tivoli subcompact SUV as the main rival here.
The solid pre-order number is good news for the company that has been struggling with declining sales in major markets such as China and the United States due to diplomatic issues and the lack of compact SUV models.
Kia's Domestic Marketing Director Seo Bo-won stressed the competitive price and good fuel efficiency as major selling points of the new SUV.
The Stonic comes with a seven-speed dual-clutch transmission and a 1.6-liter diesel engine that produces 110 horsepower. It has a fuel economy rated at 17 kilometers per liter and is equipped with six air bags. It is priced at 19-23 million won (US$16,700-$22,600) depending on options.
"The Stonic, moreover, carries unrivaled safety features among B-segment SUV rivals such as rear-side collision avoidance system and high beam assist," he said, adding the new car fully satisfies safety standards required to enter the United States and European markets.
The company plans to introduce the Stonic powered by gasoline and diesel in Europe in the third quarter, the marketing director said without elaborating.
"The timeframe for the launch in the U.S. market is still under consideration. And we have yet to decide to launch the gasoline-powered Stonic in the domestic market as well," he said.
As for possible "cannibalization" among Hyundai Motor Co. and Kia subcompact SUVs, Kia executives acknowledged the Stonic could potentially steal some customers from Hyundai since they compete in the same market. Hyundai has recently started selling its own small SUV Kona in South Korea.
To minimize the this, Seo said Kia will further focus on promoting the Stonic's aggressive design and value proposition to differentiate it from the Kona and other rivals in the same SUV segment.
Kia's current SUV lineup is composed of the Mohave, Sorento, Sportage and Niro. The Niro is a hybrid crossover that is tuned to attract eco-conscious drivers.
The carmaker also produces the popular K5, sold as the Optima in the U.S., along with the K3, K7 and K9 sedans and the Soul box car.
In June, Hyundai Motor, which owns a 34-percent stake in Kia, unveiled its own very first subcompact SUV Kona to bolster its SUV lineup. The two together form the world's fifth-largest carmaker by sales.
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