Tuesday, 7 September 2010 at 13:06, Bloomberg
Kia Motors Corp Vice Chairman Jeong Sung Eun resigned to take responsibility for the recent recall of four models as the South Korean carmaker aims to emphasize its commitment to product quality.
Jeong stepped down September 3 after Kia made a series of recalls worldwide, Michael Choo, a company spokesman, said by phone today.
The resignation highlights increased sensitivity among automakers to quality problems after Toyota Motor Corp., the world’s largest carmaker, recalled more than 8 million vehicles for problems related to unintended acceleration in the past year. Kia’s action was swift and appropriate, said Chae Hee Guen, a Seoul-based analyst at Meritz Securities Co.
“Jeong resigning is a preemptive action,” Chae said. “Quality is a top priority for Kia and Hyundai Motor Co management. They don’t want to tarnish their image.”
Kia, an affiliate of Hyundai Motor, fell 0.2 per cent to close at 33,400 won in Seoul trading, while the benchmark Kospi index dropped 0.3 per cent.
South Korea’s second-biggest carmaker is recalling about 85,900 vehicles worldwide because of an electrical wiring problem that can cause fires, the company said in an e-mailed statement yesterday.
Kia will recall about 36,000 Soul compacts as well as 33,000 Sorento and 8,000 Mohave sport-utility vehicles and 8,900 Cadenza sedans, the company said. All the vehicles were made from September 2009 to July this year, the statement said.
The company will also recall 18,147 Sorento, Borego and Soul models in China because of the problems with circuit boards, the General Administration of Quality Supervision, Inspection and Quarantine said in a statement on its website yesterday.
Jeong was a former president of Kia in charge of production division, and the company has not appointed a new vice chairman, Choo said.
Internet news provider MoneyToday reported the resignation earlier.
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