Kia Temporarily Halts Production in Slovakia

South Korean automaker Kia Motors today announced it will temporarily halt production at the Slovak facility due to collapsing sales in Europe. Even though Kia officials did not mention the new production goal, this is not the first company that counteracts the economic downturn with this kind of cut. In fact, this is just the first attempt to align production with the market demand and, in case this doesn't succeed, the company may proceed to even more cost-cutting measures.

Kia announced last November that it aims to produce around 240,000 cars in Slovakia in 2009, Autonews wrote, but this number is likely to be well reduced given the current market conditions. Even though some analysts predicted the market will be restored to its pre-recession status in a period of two to three years, Kia Motors Slovakia spokesman Dusan Dvorak said the South Korean automaker will bring production to the initial level as soon as the market conditions improve.

At this time, Slovakia holds three large production facilities belonging to Kia, Volkswagen and PSA Peugeot Citroen, respectively. According to the aforementioned source, the three plants have a combined annual output capacity of around 900,000 units a year.

Although Kia hasn't mentioned how much it plans to cut production, the Slovakian economy ministry confirmed last week that the country expects a massive production halt in 2009, with cuts likely to reach 18-25 percent this year.

Aside from these gloomy forecasts, Kia gets ready for two important milestones in the company's evolution: the official launch of the 2010 Kia Forte, scheduled for Chicago, and the mass-production of Kia Soul'ster which, according to several rumors, is likely to begin in the first months of 2010.