Sorento sales steady despite improved supply: Kia

KIA Australia has launched its facelifted Sorento SUV locally this week, the revised seven-seat offering delivering an extensive list of upgrades for a modest increase in price to see it challenge the likes of stalwarts including the Hyundai Santa Fe, Mazda CX-9 and Toyota Kluger.

Yet, despite increased supply prospects and significantly improved value for money, Kia Australia chief operating officer Dennis Piccoli says the model is unlikely to sell more than it has in the past 12 months, saying he expects sales to normalise at between 8000-9000 units.

“In terms of volume, we won’t see a lot of change (from last year’s numbers). Overall, we think we will again sell eight- to nine-thousand cars again through 2024,” he said cautiously.

“That said, there is always an opportunity to increase sales, and to date the updated Sorento has been very well received – even before advertising for the model commences.”

Mr Piccoli told media gathered for the local launch of the MY24 Kia Sorento in Melbourne this week that the split between propulsion types and grades was also likely to remain unchanged.

He said Australian buyers prefer high-grade, all-wheel drive and diesel-powered Sorento variants – and are expected to stick with the diesel option, at least until the revamped hybrid (HEV) and plug-in hybrid (PHEV) models arrive towards the middle of the year.

“The current sales split is essentially around 80 per cent in favour of the diesel, and that has been the case most of the way through (the life cycle of the current Sorento range). That will likely change when hybrid and plug-in models join the range in quarter two,” he said.

“It has been a difficult year on the supply side of things. We have had a couple of shortages in terms of components which has influenced the model mix across 2023.

“With that now easing, we should see around 30 per cent of buyers opt for the GT-Line and equally, on the other end of the spectrum, around 20 to 30 per cent opt for the S. The balance will see around 25 per cent each for the Sport and Sport+.”

The good news for Sorento buyers – and in addition to a stronger feature list and improved connectivity – is that wait times for the model are beginning to ease, returning to what Mr Piccoli describes as nearing normal.

“Wait times are starting to level out. We’re estimating that at worst, buyers will wait three to four months for their new Sorento, depending on the variant chosen and their dealership location,” he added.

More broadly, the South Korean importer says it expects the new car market to reflect those of the new Sorento.

Kia Australia chief executive officer Damien Meredith said the industry is likely to see steady numbers again in 2024, falling close to or level with those achieved last year.

“I think what’s going to happen with the market is that it will again be 1.1 (million vehicles in 2024). There is still a lot of vehicles on backorder for most manufacturers … so, I think that will ensure that the market is again 1.1,” he announced.

“In regard to the effect of interest rates, it is always going to have an effect on what happens in the (new car) market.

“But I think there is a resilience in the Australian economy that we always underestimate, and if you look to what is happening in Western Australia, then it (the economy) is still pretty strong.”

Despite a tightening of the belt for many private buyers, Mr Meredith said the resources sector is likely to keep the new car market buoyant, suggesting that the influence of that scenario will see new manufacturers enter the top 10 as the year progresses, forcing some established players out.

“We’re still exporting what we dig out of the ground, and I’m pretty confident that will help to keep the (new car) market relatively secure. Certainly, the (model) mix might be a little bit different in regards to who sells what,” he suggested.

“I think there will be some changes to market share in terms of the top 10 manufacturers, but overall, we are confident in the economy, we are confident in the market, and we are confident with what we are getting in.”