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Due to the decline in sales, Dongfeng Yueda Kia decided to stop production at a factory. Since the beginning of the year, Kia has considered shutting down a factory in China to restructure its business to save itself in response to a sharp drop in sales. According to media reports, Dongfeng Yueda Kia's first factory in Yancheng, Jiangsu Province will stop production at the end of this month. The Yonhap news agency also confirmed the news.

Dongfeng Yueda Kia was established in 2002, jointly invested by Dongfeng Group, Jiangsu Yueda Group and South Korea Kia Automotive Co., Ltd., with a capital contribution of 25%, 25% and 50% respectively. The first factory is located in Yancheng, Jiangsu Province, with an annual production capacity of 140000 vehicles. At present, only one model is produced in a factory, and its production capacity is idle.

After the first plant of Dongfeng Yueda Kia stops production, it will be leased in the form of "long-term lease" to the new force of car building, Chinese American Express, to produce new energy vehicles, and the transformation is expected to be completed in the first half of 2021. It is worth noting that Jiangsu Yueda Group is one of the investors in Chinese Express, accounting for 20% of the shares.

In response to the "first factory shutdown" in March, Dongfeng Yueda Kia said: a factory plans to be dedicated to the production of new energy vehicles to rationalize the structure of a factory; after the restructuring, Dongfeng Yueda Kia promised not to lay off staff.

It is understood that at present, there are 1000 employees in a factory, a considerable number of them have completed the job transfer and adjustment, and only a small number of employees remain in the factory to carry out the final production tasks. In addition, Dongfeng Yueda Kia's strategic SUV model Lion run will be produced by the second factory.

After the closure of one plant, Kia has only two remaining vehicle production plants in China, and its annual production capacity has dropped to 750000 units.

Kia sold 23000 vehicles in china in may, down 24.4% from a year earlier, and lowered its sales target to 430000 this year, according to the data. Kia reached an annual sales peak of 650000 vehicles in 2016.

Since the beginning of this year, Dongfeng Yueda Kia has successively launched Zhirun 1.4T model, new KX5 and brand new K3, and accelerated the layout of new energy vehicles. At present, it has launched three new energy vehicles: K5 plug-in hybrid, KX3 pure electric and Vernon 300e pure electric vehicles, all of which are produced in the second and third factories.

A few years ago, Korean brands gained a foothold in the Chinese market with their appearance design and cost-effective advantages. now, for three consecutive years, car sales in China have exceeded one million, and Kia has also risen to the height of 650000. But changes in the market eventually led to the advantage of Korean cars become moderate, brand strength also lags behind the mainstream joint venture brands, products sandwiched in independent models and joint venture models to survive, sales have suffered a sharp decline. China's auto market has continued to decline after explosive growth, and gone are the days when joint venture brands lay down to make money, and joint venture brands like Dongfeng Yueda Kia have lost their market position and brand influence.

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