LOS ANGELES - A little competition never hurt anybody.
So says Ahn Byung-Mo, the new president of Kia Motors America Inc. - which means he has no problem with Kia thrashing its parent, Hyundai Motor Co., in the U.S. marketplace.
'Hyundai has their sales target, and we have ours,' Ahn said in an interview here last week.
'While I don't think we need to compete with Hyundai directly, I tell my people to compete with them in a constructive way. However, the market is very big, so I think it is better to widen our opportunities than limit them.'
The sentiments might seem a bit strange coming from a career-long Hyundai Group man, who was installed here in January as part of Hyundai's taking control of Kia Motors' global operations. But the 48-year-old Ahn knows that if Kia outsells Hyundai in the United States, he will be doing his part to help the parent company make a profit on its new acquisition.
'We are going to manage the two companies separately, but there are synergies we can get, with shared platforms and parts and co-design,' he said.
In other words, the parent company will find efficiencies and combine resources, but the sales arms are free to have at it. For his part, Ahn wants Kia to sell 130,000 units in the United States in 1999, a mark Hyundai has not reached since before Kia came to the United States in 1994.
Launched just five years ago, Kia Motors America started out by installing dealers along the so-called import U - both coasts and the southern states - before tackling the Midwest last year.
Kia now has 482 dealers in 49 states (not yet in North Dakota), compared with Hyundai's 462 stores. And while Hyundai wants to increase its dealer count slightly to around 480, Kia aims for about 550 sites by year end.
But is there room for both franchises in America?
'They can do it if they stratify their product lineup,' said Jim Hall, vice president of industry analysis for AutoPacific Inc. in Southfield, Mich.
'If you have two brands that don't compete, you can get better market coverage and better profit. But you have to manage it. They can't get hung up on Kia having a better brand image in America than Hyundai.'
The beginnings of the relationship are becoming evident.
Hyundai disclosed two weeks ago that a minivan destined for America in 2001 had been canceled. Not only was the van not really designed for the U.S. market, Hyundai said, but it probably would have competed with the Kia Carnival/Sedona, which arrives next spring.
As a concession, the U.S.-market Sedona probably will be fitted with a larger Hyundai-built engine than had been initially planned.
Now it is Kia's turn to sacrifice.
Last week, Ahn all but killed a previous plan to import the Credos mid-sized sedan, which dealers wanted as a lower-priced alternative to the Honda Accord and Toyota Camry.
'It's not the proper car for the U.S. market. The Hyundai Sonata already provides what we are looking for in terms of quality, performance, styling and price,' Ahn said.
'When we compare the companies, we see one company has some good things, and the other company has some good things too. The cooperation is already beginning.'
Ahn is a veteran of overseas postings for Hyundai Group. He comes to Kia Motors America after a stint as COO of Eastern and Central European operations for Hyundai Precision, a sister company of Hyundai Motor.
All told, Ahn has 14 years of U.S. experience. His longest single stint here was from 1984-93, when he served as president of Hyundai Steel Industries U.S.A., a shipping-container fabricator.
Combine that with a strong relationship with the new chairman of Hyundai Group and Hyundai Motor, Chung Mong-Koo, who hand-picked Ahn for the Kia post, and Kia's U.S. dealers have plenty of confidence in the new boss.
'Ahn is an individual who is committed to product quality and the dealer-factory working relationship,' said Craig Ewald, president of Ewald Automotive Group in Milwaukee, which carries 13 franchises.
'Everywhere he has been, he has moved the needle. He is very easy to communicate with. He responds and follows up.'
Ewald was part of a group of dealers who went with Ahn to South Korea in February to meet Chung and tour some facilities, including Hyundai's new $30 million wind tunnel and Kia's upgraded factories. The dealers were impressed with Chung and with what Hyundai brings to the table.
'Chung is very focused and really on top of what's going on,' said dealer council chairman Terry Petersen, owner of Reno (Nev.) Mazda-Kia.
'I can't believe the difference since Hyundai purchased Kia. The factories look better and morale seems better. I'm more excited than I've ever been about the franchise.'