Can Kia Catch Up With Hyundai In Quality, Reliability?

September 29, 2010
Kia is on track to set an all-time sales record in the U.S. this year, beating its previous 305,000 sales, and it's no surprise how: lots and lots of product. Over the past year, the company has launched the new Soul, Forte, and Forte Koup small cars, all-new Sorento and Sportage crossovers, and now a completely new 2011 Kia Optima. On the way yet this year is a sporty Sorento SX, a Forte5 five-door hatchback, and the Kia Optima Hybrid—then next year, a replacement for the Rio.

Still, it's doing much better in some markets than others—the brand sells about 50 percent of its vehicles in 20 "more stylish" markets; while the brand has long been pretty strong on the West Coast, it's making inroads in the Northeast especially, and in Atlanta is gained a significant three-percent market share just last year.

Kia remains lower-ranked than closely related Hyundai for reliability, according to Consumer Reports, as well as for sales and after-sales satisfaction, as measured by key J.D. Power & Associates metrics. As a company, Hyundai is larger and more established in the U.S., so does Kia have a chance of catching up, or surpassing them?

To get Kia on par and past Hyundai, during this rapid growth, better dealership facilities are part of the solution on the satisfaction side of it. But John Crowe, Kia's VP for service, who has held posts at several other automakers, says that Kia's management style is very hands-on, and a lean company structure allows it to react in a way that most car companies can't, with "a direct line up" to quickly make changes to address a problem.

Crowe says that quality issues during production will be corrected with a permanent change to the design or production process in just 20 to 60 days, typically, whereas in the past, or at other automakers, it took 12 to 18 months. Furthermore, warranty claims are a small fraction of what they were just a few years ago, and he argued we'll begin seeing this in the metrics.

If Kia in the U.S. identifies an issue, Crowe said he can quickly meet with engineers and plant managers and find a solution, usually within days. He meets with plant management in Georgia weekly and in South Korea monthly.

"The lack of bureaucracy has been key," said Crowe.

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