Kia’s Crowning Achievement

On a brisk autumn afternoon in 1986, Ford Chairman Henry Ford II and the CEO of Kia stood solemnly at attention as the South Korean flag was raised in front of Ford’s world headquarters in Dearborn, MI, alongside those of other nations where Ford had significant operations.

The flag-raising symbolized Ford’s 10% investment in Kia, which began building cars and light trucks in1962 and opened its first fully integrated assembly plant in 1973. Production halted in 1981 when South Korea’s government forced local automakers to consolidate, leaving Kia to die on the vine.

By 1986, Kia had shrunk to building just 26 cars, rising to 95,000 in 1987 as the Ford relationship began to take hold.

I asked the Kia chief at the time if the automaker ever would enter the U.S. market on its own. “No, never,” he replied through a translator.

What a difference 31 years can make. Kia incorporated in the U.S. in 1992, became part of the global Hyundai-Kia Automotive Group in 1998; built an assembly plant in West Point, GA, that opened in December 2011; sold 419,075 cars and CUVs in the U.S. through the first eight months of model-year 2016; and is on track to blast past 500,000 U.S. sales this calendar year with 265,755 sold during the first five months.

Add more sales if Canada and Mexico are included in the North America total. Furthermore, Kia has joined the stampede by global automakers to Mexico, where it invested $1 billion to construct a new assembly plant to build 300,000 vehicles annually.

Kia plant in West Point, GA, celebrates production of 2 million vehicles earlier this year.

And now comes the piece de resistance: Kia finished on top in the recently released J.D. Power Initial Quality Survey covering the first 90 days after purchase of a new ’16 model, beating out heavyweights such as Porsche, Toyota, BMW and even Lexus. It was the first non-premium model to capture the top spot in 27 years.

Kia scored 83 problems per 100 vehicles to take the prize, while Porsche finished close at 84, with Kia parent Hyundai in third place at 92. A total of 80,000 new-model owners were surveyed from February to May.

In a way Kia’s outstanding achievement overshadowed the fact that for only the second time in the survey’s 30 years General Motors, Ford and FCA collectively reported lower problem levels than all foreign-based auto makers combined. Moreover, the Detroit Three ranked first in seven of 17 segments, and collectively improved their scores 10% compared with 2015, double the overseas group. Chevrolet, Buick and Lincoln finished in the top 10 while Ford wound up 11th.

Kia also placed first place in the small SUV category (Sportage) and second in midsize SUV group (Sorento). J.D Power’s IQS also awards global assembly plants focusing on PP100.

Kia’s Kwanju plant, which builds the kitschy Soul, picked up a second-place Bronze Award, finishing only behind Toyota’s Motomachi 1 plant that produces the Lexus GS. The domestic automakers were shut out of these awards, but four U.S. transplants were winners.

All automakers are improving the intuitiveness of infotainment system controls, a persistent complaint of new-car buyers, but J.D. Power’s Renee Stephens, vice president-U.S. automotive quality, could not say whether Kia’s high score reflected gains in this area. But she told reporters at an Automotive Press Association event that “manufacturers are currently making the highest-quality products we’ve ever seen.”

Kia obviously has come a long way from the flag ceremony in 1986 that marked its revival. Ford at that time had a close relationship and partial ownership of Mazda and Kia built cars for the Japanese automaker, which included the Mazda-based Ford Festiva and Aspire sold in North America.

But Kia’s impetus was stalled again by the mid-1990s Asian financial crisis and forced into bankruptcy in 1997.

Although some Ford insiders pushed to keep the Kia deal alive, when the company was put on the block Hyundai outbid Ford and acquired a 51% interest in Kia (now 34%).

Since then the two South Korean companies have been on a tear, in recent years expanding globally with an avalanche of attractive new cars and CUVs covering most niches – and taking no back seat on the technological front as well. Kia generated $45 billion in revenues last year and currently ranks ninth globally.

One legacy of Ford remains, however. Early on Kia designed a rendition of Ford’s famed oval as its logo. You still can see it on every Kia out there.