Kia, the Russian distributor of South Korean cars, is moving some of its operations to Kazakhstan. This was told to socialbites.ca by an automotive industry source familiar with the situation at Kia’s Russia office. In addition, this information is confirmed by data from the registration documents of the company; accordingly, from August 10, 2023, the Russian legal entity Kia Russia and CIS LLC registered changes in Russian legal documents, in particular, the company indicated a connection. having practically the same legal personality, but in the neighboring province of the EAEU – the representative office of Kia Russia and CIS Limited Company in the Republic of Kazakhstan.
According to the register of legal entities of Kazakhstan,
Kia Russia and CIS Republic of Kazakhstan LLC was registered in Astana almost two months ago (26 June 2023).
Korean manager Nam Chun Sik has been appointed head of the local company (100% subsidiary of Russian legal entity Kia), according to the data disclosure record. The information that the legal entity was registered by a Korean automobile company with reference to the Ministry of Justice of the Republic was also confirmed to socialbites.ca by Artur Miskaryan, Director General of the Kazakhstan Automobile Market Monitoring and Analysis Agency (AMAAR). .
there is something to do
Miskaryan said that a year ago, Kia representatives announced their plans to establish a joint venture with Kazakhstan’s largest automotive group, Allur Auto. The addressee associates the transfer of the representative office with the need for a local legal entity to engage in the operating activities of the enterprise and the distribution of further cars from this facility.
Currently, at the Allur plant in Kostanay (formerly SaryarkaAvtoProm), the K5, Sorento and Picanto models are produced using the SKD method. Since 2023, welding and painting (CKD) assembly of the Sportage crossover has begun. This year the Cerato sedan will also join it.
Artur Miskaryan states that the new Allur and Kia plant will be able to produce the most popular cars of the Korean company’s local model range. Now Kia is represented in Kazakhstan with models Sorento, Seltos, Carnival, Ceed, K9, Ceed SW, Stinger, EV6 and XCeed in addition to the cars mentioned above.
Construction of Kia and Allur facilities has begun, welding and painting workshops will be located, and the production of some automobile components will also be localized,
already in 2025 it is planned to produce a batch of pilot cars,
said Miskaryan, head of AMAAR.
socialbites.ca sent questions to the official representatives of the company about the reasons for the establishment of Kia’s Kazakh representative office, the publication turned to Allur Auto with similar questions. No response was received from the editorial office at the time of publication of the material.
There is nothing to do in Russia
Kia’s representation in Russia has fulfilled functions for our country and the CIS, which is reflected in its name; Russia has always been the leading driver for the Korean company, but now the official sales vector has changed, so Igor Morzharetto, partner of the Analytical agency “Autostat”, believes that opening an office in a neighboring sanctioned country is a logical step.
“Official sales in Russia have been stopped and what comes with parallel imports is “Michurin’s tears”. As far as I know, some companies moved to Kazakhstan not so long ago. Now it looks like other companies will look there. Main sales are there, especially since Kia will have an assembly plant in Kazakhstan.
And they have nothing to do here today,
Morzharetto stated this in a conversation with the socialbites.ca correspondent.
Coming to Russia
A socialbites.ca source from the automotive industry, familiar with the work of Kia’s Russian office, said that despite the significant reduction in staff, the office is not completely disbanded and there are no such plans yet. All responsibilities are reduced to a minimum of work to support warranty service and other indirect functions. Morzharetto from Avtostat has similar information.
“Kia’s representation in Russia has already been greatly reduced. As far as I know there are only a few left. The volume of business, which was quite large until the spring of last year, has drastically decreased.
Accordingly, someone will definitely be invited to move to Kazakhstan.
It is unlikely that many people will stay here. Very few of them remain. The person they wanted had already been transferred to other offices. “I know people who have been offered to work in offices in Europe, but that’s a technical decision anyway,” Morzharetto said.
Independent automotive industry consultant Sergey Burgazliev is confident that Kia will maintain at least a minimal presence in Russia, as the Koreans do not want to leave the Russian market completely. He believes that, thanks to the country’s membership in the EAEU, later Kazakh Kia vehicles will be able to freely travel to Russia.
“Perhaps there is some kind of plan to supply cars with Kazakh VIN numbers to Russia via Kazakhstan. If the representative office is not completely closed and is geographically and logically located in the EAEU country, then it is clear that they will not want to completely leave the Russian market,” Burgazliev concluded.