Kia Slowly Shedding Image of a Cheap Brand

The problem isn't that U.S. consumers haven't heard of Kia. Most Americans know it's a South Korean auto maker.

But ask them to name all six Kia models. You might as well ask them to recite the Gettysburg address in Korean.

Mention the name Amanti, and a lot of Americans might think you're talking about Armanti, an upscale Italian clothier, not an upscale Kia sedan with a sticker that nears $27,000 with a leather package option.

Alas, many Americans associate the brand with cheap entry-level vehicles. That was then. Yet a lot of people remain stuck in the old mindset. Kia Motors America (KMA) marketers are trying to change that. They say there's typically a three-year lag before people's perceptions catch up with reality in such matters.

“The Kia name recognition is strong, but we haven't got the brand image where we want it to be,” says Wally Anderson, KMA's vice president-sales and marketing. “The model names are largely unknown.”

But he's not lamenting sales tallies of late.

Kia has sold cars in the U.S. for a decade. It was a two-model franchise for half that time. It's gone from selling 12,000 models here in 1994 to 237,000 units last year.

It outsells BMW, Mercedes-Benz, Audi and Infiniti in the U.S. It has a shot at passing ailing Mitsubishi this year, says KMA CEO Peter Butterfield, a former Ford Motor Co. executive.

He adds: “We're moving faster than anyone else. We're becoming mainstream. Five years from now you'll be saying this is a major Asian auto company.”

The car that's expected to lead the pack is the new Spectra compact. Kia brass say the redone '04 Spectra is unlike its modest predecessor. “We've changed just about everything but the name,” says Fred Aikins, Kia's product strategy manager.

It's longer, wider and taller. It has six airbags and six cup holders that are capable of holding “my favorite, a 40 ounce Slurpie,” says Aikins.

Kia's strategy is to offer comparable value for less money while continuing to swim upmarket. The Spectra's base price is $12,620 compared to $13,570 for a Toyota Corolla and $13,010 for a Honda Civic.

Three years ago the average transaction price for a Kia was $12,000. Now it's approaching $20,000.

“Yet a lot of people, including dealers, still think we're selling entry-level vehicles,” says Butterfield.

That brand-awareness gap is “holding us back,” he says. So it goes with the slow process of brand building, he laments.

“The simplest way to put it is that if we put a Toyota badge on our cars, how many more would we sell?” he asks.

Anderson says a marketing challenge “is to get people to buy the car because they love it.”

Meanwhile, there are now 320 Kia dealers. Among the newest is Joe Verde, a former top dealership salesman who's now a well-known sales trainer based in Southern California. It's his first auto franchise.

That tells you something, says Butterfield.