Why are Kias Cheap? Because They're Unreliable?

People all over the world admire Kia for its reliable experience and affordable prices. A similar segment Kia would cost approximately 15% lesser than a Toyota or Honda. Mind you that Toyota and Honda aren’t Luxury brands either.

So, why are Kias so cheap? People often justify their affordable prices by conflicting their reliability. Is that the case? Let’s find out in this article.

Why are Kias so Cheap?

Kias are so cheap due to the following reasons:

Production on Strict Budget
Lower Taxes Imposed by Local Government
Cheap Labor in South Korea
High Maintenance Cost
Little to No Innovation

Let’s dig deeper into these reasons to find that why are Kias so cheap.

Strict Budget

The parent company of Kia was originally established in 1944 but due to financial crunch, it had to close soon. It wasn’t until 1986 when Kia was reestablished and began its production. The company learned a lot from their ordeal and decided to put extra restrictions on expenditures. This helped in keeping the prices of Kias to a minimum level.

Lower Taxes

South Korea is predominantly an industrial country. Local governments and regulatory bodies choose to support local manufacturers by keeping the taxes to the bare minimum. Moreover, being manufactured inside Korea, Kia doesn’t have to worry about the import duties as well. This also cuts some of their costs.

Also read: Are Korean Cars Reliable? Here are the Facts

Cheap Labor

As pointed above that South Korea is an industrial country. Unlike some other countries, where people can choose farming or other crafts. Koreans choose to work in factories. The abundance of working individuals means that labor rates are significantly lower in South Korea. This paves the way for cheaper Korean cars.

High Maintenance Cost

Kias are made cheap, but their parts are extremely expensive. Hence, they may cost a fortune to maintain. In a way, if you see this scenario, it is a win-win for Kia as their spare parts sale also rakes in a lot of money. So, in order to make up for high maintenance, Kia offers their cars at a relatively lower price to lure buyers into purchasing.

Little to No Innovation

Like Japanese, Koreans don’t tend to innovate a lot. They are reluctant to change their old methods and techniques of manufacturing. They have sustained their engine and chassis design as well. This also saves them a lot of money in design, set up & development costs. All these factors combined lead towards cheaper Kias.

Does Kia Offer Inferior Quality?

Kias are known to have the best quality. By virtue of their top-notch quality, Kia has managed to stay ahead of their American and European counterparts in terms of reliability. Korean quality procedures and protocols are by far the best in the world.

The reason why Kia cars are so reliable is due to the fact that they don’t compromise on quality. Kia has scored 4 out 5 scores on the reliability index. They are so confident about the quality of their products that they offer the longest warranties in the auto industry.

Does Kia Depreciate Fast?

Despite being extremely reliable and dependable cars, Kias don’t tend to hold their value. They lose up to 40% of their values within 3 years of operation. This value retention is even worse than lesser reliable German vehicles.

The fast depreciation of Kia is attributed to the worst resale value of its three best-selling cars. Which is Kia Sorento, Sedona, and Cadenza. Kia Soul is an expectation as it has better resale value. It is also ranked among the top 25 cars for best value retention.

Also read: Do Kias Hold Their Value? (7 Models Compared)

Is Kia Maintenance Cheap Too?

Unfortunately, Kias aren’t the cheapest cars to own. The average maintenance cost of Kia comes to around $652 per year. This value is unjustified considering the initial prices of Kia.

The average maintenance cost of Kia is almost double the maintenance cost for Honda or Toyota. Something as simple as an oil change can cost up to $100 for Kia. Kia spare parts tend to be expensive as well. A major replacement can go quite heavy on your pocket.

Also read: 10 Cars Under $20K that Look Like They’re for $50K+

Is Insurance of Kia Cheap Too?

Due to the higher maintenance cost of Kias, Insurance companies are inclined to charge more. The annual insurance cost for Kia is about $1,600. This price may vary depending upon the make, model of the car, and country of purchase. The insurance rates for Kia are 70% more in comparison to Japanese cars. Which cost only $900.

What is the Fuel Cost for Kias?

The average fuel cost of Kia is about $20 per 100 miles. This cost is slightly higher than Japanese or perhaps American cars as well. Kias are not frugal when it comes to fuel consumption. Their cars are often high-performing, and they have powerful engines. So, fuel costs are usually higher.

What are the Most Affordable Kias?

Rio Sedan is the cheapest car offered by Kia. The lowest price of the base trim for Kia Rio is as low as $16,500. Kia offers the most affordable luxury cars in each segment whether it be sedans, SUVs, hatchbacks, or hybrid.

Some of the cheapest cars offered by Kia other than Rio are:

Kia Forte – $17,900
Kia Soul – $19,200
Kia Seltos – $22,500
Kia Optima – $23,500
Kia K5 – $23,800
Kia Sportage – $24,100
Kia Niro – $24,800

What are the Best Cheap Alternatives for Kia?

The cheapest alternatives for Kias can be found in other Korean or Japanese cars. Since they share the same reliability traits, and that too at an affordable price. Following are the top choices for the best cheap alternatives of Kia:

2020 Chevrolet Spark LS – $14,395
2020 Mitsubishi Mirage ES – $14,990
2020 Nissan Versa S – $15,655
2020 Hyundai Accent SE – $16,270
2020 Toyota Yaris L sedan – $16,605
2020 Honda Fit LX – $17,120
2021 Mitsubishi Mirage G4 ES – $17,590
2019 Fiat 500 Pop – $17,990
2020 Hyundai Venue SE – $18,490
2021 Subaru Impreza – $19,720
2021 Volkswagen Jetta – $ 19,990
2021 Nissan Sentra – $20,335
2021 Hyundai Elantra – $20,645
2021 Hyundai Veloster 2.0 – $20,905

References:

mentorkia.com, insuraviz.com, oneshift.com, cars.com, motortrend.com, caredge.com, motor1.com, quora.com, vehiclefreak.com, statista.com, en.wikipedia.org