[Concall] Kia "Focused Management on Car Semiconductor Supply... No Short-term Production Disruptions Expected"

"Automotive Industry Faces Overall Supply Shortage, but Focused Management Ensures No Immediate Production Disruptions"

On the 15th, the new logo of Kia Motors was displayed on the exterior wall of the Kia Motors headquarters building in Seocho-gu, Seoul. The new logo removes the previous red oval border and presents the alphabet 'KIA' in a simple and futuristic style. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Yoo Je-hoon] Kia recently stated that there will be no short-term production disruptions related to the ongoing global shortage of automotive semiconductors affecting the global automobile manufacturing industry.

On the afternoon of the 27th, during an earnings conference call, Kia said, "We cannot say that we are prepared for the situation over the next 3 to 6 months, but through focused management since the fourth quarter of last year, we have prepared to ensure that there are no immediate production disruptions."

Recently, major global automakers have been facing difficulties in securing automotive semiconductors due to production cuts caused by COVID-19 and increased semiconductor production for electronic devices by foundry manufacturers, resulting in factory shutdowns and other disruptions. Semiconductor manufacturers have also shown signs of raising automotive semiconductor prices by 10 to 20% in response to the recent supply shortage.

Regarding this, Kia said, "It is true that the entire automotive industry is facing a tight supply situation," but added, "During the COVID-19 situation, Kia reviewed the entire supply chain, and in line with this, we recognized the situation around the fourth quarter and have been conducting a review of all items since last October."

Furthermore, Kia stated, "As alternatives, there are methods such as increasing inventory, finding substitute components, or even changing the specifications entirely to find alternative specifications," and added, "Through these efforts, we have prepared to ensure that there are no short-term production disruptions at the current level."