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Kia seeks short-term supply solution for strong Ceed residuals

Date: 27 December 2006

Kia Ceed - rear

Kia is offering an industry-first seven-year warranty (five years standard, an additional two years on powertrain) with its . But, according to marketing general manager Lawrence Hamilton, this isn't key to the strong retained value it seeks.

"The warranty is longer-burn. Short-term, it's a matter of controlling numbers and where cars go. By doing this we can convince the used market, generate used car demand and hopefully achieve an RV in the low '40s."

As such, fleet deals and discounts on the Cee'd will be few, and the overall fleet mix is unlikely to exceed 40% in the short-term. "We certainly won't be doing daily rental - we can't afford the residual hit," says Hamilton.

But a fleet plan is in place. "It's a matter of training, and convincing dealers they can make money from fleet. Local, low-volume business is our aim, rather than larger national deals.

"With a good residual value we can get the better fleet business we desire. But first, we must convince the analysts that our supply up front is under control."