It falls under the same category as Toyota Fortuner
Kia will be launching its seven-seater SUV Sorento this Friday. The vehicle will fall in the same category as Toyota Fortuner.
It will be Kia’s fourth car to be sold under the present Kia-Lucky setup in Pakistan. The company is already selling its compact SUV Sportage, hatchback Picanto, and minivan Carnival.
Sorento will have three variants—2.4L FWD, 2.4L AWD and 3.5L FWD.
Research Analyst Abdul Ghani Mianoor of IM Securities says market expectations are that the three variants will fall in the price range of between Rs7 million to Rs9 million.
The analyst added in his report that it will directly compete with Toyota Fortuner, which comes in 2.7L and 2.8L engines in a price range of between Rs7.7 million and 9.2 million.
But another auto sector analyst Shakaib Khan thinks otherwise.
“We don’t have a direct competitor of Sorento yet,” said Khan. “It is a seven-seater and it has three rows of seats. It is a medium-size crossover SUV. It is bigger than a Rush, Sportage, or Tucson but smaller than a Fortuner or a Prado.”
Khan did not think that Sorento can hit the Toyota Fortuner market much as the latter is a proper SUV while the former is a crossover.
Khan says Sorento will have a better ride within the city but the Fortuner would be better for off-road experiences. This means that the Fortuner’s demand in rural areas may remain unaffected but the Sorento could put a dent in its urban demand.
Kia has been assembling cars in Pakistan under green-field status, which it received following the government’s Auto Development Policy (ADP 2016-21). The government launched the policy to attract foreign investment and help increase competition in the auto sector, which was dominated by three Japanese companies for a long time.
The ADP 2016-21 policy ends in June 2021 and the models introduced by new companies, known as new entrants in the industry, will be considered for duty relaxations. According to a source, all new companies will try to launch as many models as they can before the ADP 2016-21 policy ends.
According to Mianoor, Kia has become the fourth largest car making company in Pakistan by sales. It has a plant capacity of 50,000 units per annum, and the company has presently been operating on a double-shift basis since January this year. It is also expected that Kia may launch at least two other vehicles before June, in order to avail tax benefits from the policy.
Kia-Lucky is a subsidiary of listed company Lucky Cement. The stock price of Lucky Cement moved up by over 4% from Rs792 to Rs839 by the time this story was filed.