Following the successful launch of the Kia Sportage SUV in February last year, Kia has posted buoyant figures for 2016, with sales up 13.9% overall to 89,364 in the UK.
This growth was largely driven by Kia’s expanding fleet sales, with a 16.4% surge in 2016, compared with private sales up by 11.3%. In the words of Simon Hetherington, Kia’s commercial director: “Growth last year was extraordinary.”

Yet, despite 60% of Kia’s customers being conquest buyers looking for a change, when asked about a shift away from diesel, Hetherington responded: “Our diesel mix actually grew fractionally last year, up to 54%.”

During the launch of the Kia Rio supermini, John Hargreaves, Kia’s head of fleet and remarketing, told BusinessCar: “We are seeing a few more petrol cars at the lower end. Things that are classed as fleet, like salary sacrifice – a lot of that is small cars and petrol-driven cars. But, looking at the Cee’d and Sportage as our two fleet staples, diesel is still very much the dominant source of power for us.”

In contrast to the Cee’d and Sportage, Kia is expecting more Rio buyers to choose petrol when it arrives in showrooms this month, and if the supermini starts to gain ground on rivals like the Ford Fiesta, Kia’s petrol mix could increase during 2017.

A continued trend towards SUV sales and the previous Rio’s sales figures make it highly unlikely it will topple the Sportage, however. It racked up around 40,000 sales last year, the majority of which were diesel.

What if the buying habits of private and fleet buyers do start to shift? “We are looking at alternative powertrains more and more, but very gradually, and I think this year I’m still expecting a lot more diesel than petrol or electric,” said Hargreaves.

“There’s no doubt the news and the constant noise around diesel is bound to have an impact, particularly in the London area,” added Hetherington. “We just haven’t seen a lot of evidence of it yet.”

According to Hargreaves, there could be some initial signs of change: “The main thing I’m seeing is the difference in petrol versus diesel residuals. Whereas if you go back a few years, the diesel was a more expensive car to buy, it had a higher residual value, and now you are getting to a the stage of parity, or in some cases you’ve got a higher petrol residual than diesel. Eventually that will feed back through to whole-life costs, and that will feed through into fleet.”

“Is there going to be a shift away from diesel?” said Hetherington. “I think you’d have to say, based on everything you read at the moment, yes. How much that will be, I couldn’t say. What’s encouraging is our ability to react quickly to those changes. It’s not a major concern either – it’s something we’ll monitor and respond to.”

It’s a sentiment shared by Kia sales director Steve Hicks, who told BusinessCar: “We just need to make sure we’re best placed for what our customers want.” Kia has already launched is first-ever hybrid, the Toyota Prius-rivalling Kia Niro, which doesn’t quite match the Prius’ economy figures, but aims to attract buyers with its stylish crossover bodystyle, while the fleet-friendly Kia Optima plug-in hybrid with 37g/km of CO2 emissions also arrives this year.

Despite predicting a small contraction in the marketplace during 2017, Hetherington feels Kia will continue to grow according to its own long-term strategy: “This was first announced about five years ago, and the Vision 100 sales strategy was based on becoming one of the top-five volume brands in the UK, which would equate roughly to a 5% share or 100,000 units per year. That feels within our grasp by the end of the decade, based on recent rate of growth.