As Nissan Departs, Kia Builds California Campus

GARDENA, CA – Ironically, while Nissan North America Inc.’s 43-acre (17-ha) headquarters campus here is up for sale as it heads to a new home in Franklin, TN, Kia Motors America Inc. is building a new North American headquarters 35 miles (56 km) to the southeast in Irvine.

Nissan cites the lower cost of doing business in Tennessee as one key reason for relocating from Southern California, but that does not deter the South Korean auto maker, whose operations are scattered about the Irvine area.

Kia is investing $70 million in the main corporate facility, which coincidentally is the same amount Nissan is investing for its new headquarters near Nashville. Kia also will spend another $17 million for a new design center during a “phase two” build-out of the 21.7-acre (8.7-ha) Irvine site.

A relative newcomer in the U.S., Kia’s sales have grown from only a few thousand units during 1994 – its first year in the market – to 275,851 in 2005.

The auto maker announced on March 13 it will build a vehicle-assembly plant in West Point, GA – its first U.S. manufacturing plant. The $1.2 billion facility will begin production in 2009.

In California, Kia broke ground for the new 236,000-sq.-ft. (21,924-sq.-m) headquarters last June and expects construction to be completed by December. No timetable has been given for “phase two.”

Kia and its parent, Hyundai Motor America Inc., currently share design and technical facilities in Irvine. Kia says splitting from Hyundai in California will allow both brands to focus on producing more distinctive designs.

Hyundai and Kia also share a proving ground built in 2004 in California City in the Mojave Desert, 100 miles (161 km) north of Los Angeles, and a technical center that opened last October in Superior Twp., MI.