Driven: Kia ups value equation with new Rio

KIA Motors Australia has held pricing firm and introduced a solid increase in features and equipment with its new-generation Rio as the South Korean brand strives to increase sales and market share in the light-car segment.

The redesigned Rio now on sale has brought a rationalisation to the model range, with the three-door version deleted and the 1.6-litre engine and six-speed automatic transmission combination no longer available, leaving the 74kW/133Nm 1.4-litre four-cylinder engine – with six-speed manual or optional four-speed automatic – as the sole powertrain.

A new 1.0-litre three-cylinder turbocharged engine is under consideration, as is a six-speed automatic.

Kia would give no timing on the addition of the small engine and multi-cog automatic at the new Rio’s launch in Melbourne last weekend, other than to say they were being evaluated and, during the presentation, referred to the top-line SLi model as “the current flagship” – indicating room for a successor.

For now, the five-door model enters the busy light-car market without a price rise, opening with the S manual at a driveaway price of $17,490, a discount of about $1500 to its listed price of $16,990 plus on-road costs.

The previous Rio line-up started with a three-door S model with 1.4-litre engine and manual transmission for $15,990 plus on-road costs and an extra $2000 for the automatic. The five-door S started at $16,990 plus costs and $2000 more for the auto.

Kia Motors Australia chief operating officer Damien Meredith said the bigger and more equipment-packed new Rio represents better value for money and has greater appeal to light-car buyers than the previous model, adding to the brand’ s ownership appeal of seven-year warranty, seven-year roadside assistance and capped-price servicing for seven years.

“We used to be called the Rio car company,” he said.

“We have moved on but Rio is still an important plank in our business, so much so that we expect to sell 7000 this year.” Kia sold 6054 Rios in 2016, down 14.7 per cent compared with 2015 which is attributed to supply issues.

“The end of the previous model production finished in about August and new production stated in October, so there was a period in between when we just didn’t have any cars,” Mr Meredith said.

“We were seventh (in segment) last year and we think we’ll be sixth this year. It’s still very competitive.” Despite Rio’s sales decline, Kia as a brand increased sales in 2016 by 26.5 per cent over 2015 to 42,668 units – enough for a 3.6 per cent share of the Australian new-vehicle market (up from 2.9) and 10th position on the list of top-selling brands.

“That was the first time we had snuck into the top 10, so we look at 2017 with a lot of optimism,” he said. “We believe the market will be about the same as it was in 2016, so for 2017 we are estimating 1.176 million units.

“Our expectation for our brand is 48,000 units which should give us a market share of just over four per cent.” Mr Meredith said Kia looked closely at tightening the Rio model range, making showroom space for the new-generation Picanto sub-light car due in the second quarter, as well as the Stinger sedan in the third quarter.

“I think we have had far too many variants over the years and we are now wanting to keep it nice and tight,” he said. “We have a bit more than half of Rio sales to private buyers which is more than most other market segments.

“The ratio at the moment with private versus fleet in the light-car segment is about 50:50 but with Rio it is more like 55:45 in favour of private ownership.” Mr Meredith said customers in the segment are buying on equipment and technology, style and price. He said Hyundai’s Accent – which last year tripled Rio sales – is the biggest seller because it is pitched on price, with a similar reason being successful for cars such as the Toyota Yaris, Mazda2 and Volkswagen polo.

“So we think that at $17,490 (S manual driveaway) we have got a very good argument and we’re confident that we can increase the private sector ratio,” he said.

Asked if he saw room for more price cuts by Kia to improve Rio sales, he said: “I don’t see that.

“At $16,990 (S manual plus on-road costs) we are probably right on the edge. At 17,490 driveaway we are pretty confident we have got the price right, based on the success with the previous model.” Kia has rolled out Rio with an accent on more technology and safety, bypassing performance with a conservative approach to the drivetrain by carrying it over from the previous generation.

Inside, the cabin represents a total makeover as the Rio aligns itself with the technology and connectivity features that have more recently been metered out to the larger Cerato and Optima.

It picks up the increasingly common 7.0-inch centre touchscreen for infotainment and includes Apple CarPlay and Android Auto.

The redesigned Rio is longer and wider, but lower, and has increased cabin room with a bigger boot.

Kia Motors Australia product planning manager Roland Rivera said the new car is “more mature, more refined” than before.

“It is a tech-savvy vehicle. The cabin has the prominence of the 7.0-inch floating screen. There’s more information for the driver, starting with the 3.5-inch screen between the instruments,” he said.

“There are features included for the first time, such as the digital speed readout, a factory-developed satellite navigation system (standard from mid-series Si grade), a digital radio and a USB charger for the rear-seat occupants.” Kia has also increased the level of safety equipment, adding a reversing camera, automatic dusk-sensing headlights, daytime running lights (halogen for the S, LED for the others) and rear parking sensors on all models.

Cornering brake control, which maintains directional stability but automatically applies the brakes to individual wheels, and hill-start assist are also fitted standard across the range, while the Si and SLi have static cornering lights.

ABS brakes, electronic brake-force distribution, emergency brake assist with electronic stability and traction control are all on-board.

“We have the necessary tools for the maximum safety rating from ANCAP and already have the highest rating in SAT tests,” Mr Rivero said.

From the S at $16,990 plus on-roads with the manual or $19,090 with the automatic, the Rio range jumps to $21,490 for the auto-only Si and to $22,990 for the top-spec SLi (also only available with auto).

While the basic specification is high, the Si adds sat-nav, cruise control, speed-dependent audio volume control, illuminated vanity mirrors, black high-gloss cabin trim, higher-grade steering wheel, heating/folding functionality to the exterior mirrors and a chrome grille surround.

The SLi has premium seats, upgraded instruments, climate-control air-conditioning, aluminium sports pedals, an electric sunroof, privacy glass and rain-sensing windscreen wipers.

The new-generation Rio is more rigid than previously, with additional bracing and greater use of high-tensile steel – up 30 per cent on the old model.

The longer wheelbase, up by 15mm, returns more legroom for all passengers – with up to 80mm more for front occupants – and a wider cabin for up to 31mm more shoulder room.

Cargo space has grown to 325 litres which is seven litres up on the old model. This increases to 930 litres – up 57 litres on the outgoing model – when the rear seats are folded.

The 1.4-litre engine develops 74kW of power at 6000rpm and 133Nm of torque at 4000rpm. Running on regular unleaded petrol, the Rio can return fuel economy of 5.6 litres per 100km on the combined cycle with the manual gearbox, or 6.2L/100km with the auto.

CO2 emissions come in at 129 grams per kilometre for the manual, and 145g/km for the auto.

2017 Kia Rio pricing*

S	$16,990
S (a)	$19,090
Si (a)	$21,490
SLi (a)	$22,990

*Excludes on-road costs