Kia Is Keeping Cars From Canadian Buyers to Reduce Year-End Sales: Report
While buyers wait for their finished vehicles to be delivered, the company is allegedly parking them until the new year.
We saw the headlines time and again during the COVID pandemic: Automakers can't build enough cars to meet demand, and buyers wait months or even a year for their vehicle as a result. Something different is going on in Canada, it seems, as production allegedly isn't what's stopping the delivery of new Kias. Per a CBC report, the manufacturer's Canadian arm is purposely holding lots and lots of complete cars to game 2023 sales numbers.
The news story cites a video obtained by CBC's investigative segment Go Public, in which Kia Canada's Central Region Manager Vince Capicotto details the plan. Although vehicles are being built and shipped to storage facilities across the country, Kia Canada is seemingly keeping them until 2024, as it has already hit its sales target for the year. There's concern that if they surpass the figure, which is reported to be 84,000 units, then the Korean headquarters may limit its marketing budget for next year.
The Drive reached out to Kia Canada for comment and a spokesperson's response has been added at the bottom of this article.
"With the global slow down, Kia Canada wants to control wholesale and retail performance in 2023 to not show high over-achievement," Capicotto reportedly said. "There's a high risk with over performance that Kia headquarters will not provide Kia Canada resources necessary in our budget for 2024 to have a successful year if we over perform for the balance of 2023 at too high a rate."
This raises obvious frustrations for dealers, not to mention the paying customers who expect their cars to be delivered as soon as possible. It's a relatively unheard-of tactic, at least in my time covering the car industry.
"I've been with the brand since 2004," one employee said in CBC's report. "This is the first time I've seen the dealer body penalized for selling too many vehicles."
"This shows a complete lack of respect for every dealer in Canada … and our customers," added another. "No sold units should ever be held, they should be expedited."
High-demand models like the Kia EV6 have seen delays of up to a year and a half, which already has buyers feeling antsy. News like this can only lead to more contempt. This sentiment is shared by several people in CBC's original article, and even though 2024 is less than two weeks away, nobody wants to wait longer than they have to.
Updated on Wednesday, Dec. 20, at 10 a.m. ET: A Kia Canada spokesperson responded to The Drive's request for comment with the following statement:
"Kia Canada is not able to provide comment on reports regarding internal business matters, including the accuracy of any such reports.
"In spite of ship delays, port strikes and railcar shortages, 2023 is a record vehicle delivery year for Kia Canada. Though these logistical issues persist into November and December 2023, we are tracking to have one of our best year end deliveries to Kia dealers in our company history.
"The satisfaction of our customers remains our highest priority. We continue to work with our dealers to prioritize the fulfillment of customer orders sold in 2023. Furthermore, customers who have been impacted by a delay in their order will receive additional benefits from Kia in the month of January.
"We remain committed to ensuring our customers timely delivery of their orders in 2023 and beyond."
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