CORPORATE

TAKEOVER

KIA Concession
6 Rue des Peupliers
ZA du Petit Nanterre
92000/NANTERRE
France

21 Rue Ampere
78100 / St GERMAIN EN
LAYE
France

Adrien RAKOTONDRAINIBE Nadia

Presentation of the
Company

The Group
Kia Motors Corporation is headquartered in Seoul
The South Korea's second-largest automobile manufacturer.
Following the Hyundai Motor Company
Sales of over 2.7 million vehicles in 2012 and almost 2.75
million vehicles in 2013
As of December 2013, the company is 33.88% owned by
the Hyundai Motor Company.
Concerning the case we are going to take an interest in
AMDS92 society based in Nanterre 92.

 Hyundai Kia Group is now the fourth largest car company in

the world
Slogan: the power to surprise
Young automotive brand
Using a competitive pricing strategy
Positive perceptions of its products through high profile
sponsorship deals.
Image: manufacturer of cars of great quality and design. To
do this it has harnessed the power of sports marketing to
influence consumers perceptions.

The Concession
The company is an exclusive car concession Kia and dedicated to the sell of
brand new Kias engines, second hand Kias engine and every types of after
sales services as well. The company is also authorised repairer MG Rover.
The company is located in two different sites, one is in Nanterre and the
other nearby Saint Germain en Laye.
Which kind of trouble did this company get into ?

Since the 10th of October 2013 this company is subjected to a receivership

taken care by the commercial court of Nanterre.
By the way we are going to build up a recovery plan in order to respond to
the call for tender.

Benchmarking
Kia is part of the Hyundai Kia Automotive Group

Regarding where the Kia is, we decided to concentrate on brands which are close to Kia.
Audi
Vauban Automobile (Peugeot)
Alliance Renault
RG Automotive (all brands)
Porsche (But Porsche has not the same range of product)
With two high level brands such as Porsche and Audi, we can say that our store may rise
his standards.
We will analyse ranges, adaptations, stocks rotations, the consumer service, employees

Ranges

Audi (Global)

14 models:

A1; A3; A4; A5; A6;

A7; A8; Q3; Q5;
Q7; TT; R8; RS; etron.
3 models: Peugeot, 128 270 562
Renault, Ford.

Vauban Automobile

Adaptations
Sales figure

Stocks rotations

Consumer service

Employees

52 412 employees

Stocks:
16216400

By Phone, Internet

268 employees

6 741 447

25 employees

110 employees

http://www.verif.com/bilans-gratu
its/VAUBAN-AUTOMOBILE-609800495/
http://www.societe.com/bilan/vau
ban-automobile-60980049520131231
1.html

Alliance
Renault
Remplacer par BMW Vlizy

11 models:
Serie 1; 2; 3; 4; 5;
http://www.verif.com/bilans-gratu
6; 7; X; Z4; M;
its/BMW-DISTRIBUTION-443860101/ BMWi;
http://www.societe.com/societe/bm
w-distribution-443860101.html

RG Automotive

http://www.societe.com/societe/rg
-automotive-534784525.html
http://www.societe.com/societe/rgautomotive-534784525.html

Porsche
Porsche Distribution Vlizy:

7 models: Boxster; 74 084 978

Cayman; 911; 918
Spyder; Panamera;
Macan; Cayenne.

Marketing Analysis

Vision and mission

Groups Vision: Together for a better future
The Hyundai Motor Group aims to create ultimate value
and promote harmonious growth for all stakeholders
through eco- friendly management and respect for
mankind
Automotive Vision: Lifetime partner in automobiles and
beyond
To become a trusted lifetime partner of our customers,
we will bring a new perspective to automobiles through
innovative mobility solutions based on human-centric,
eco-friendly technologies and service

Core Values
Customer:
Promote a custmer driven culture by providing the best
quality servicewith all values focused on customers
Challenge:
Embrace every opportunity for greater challenge,
Confident in achieving goals with ingenious thinking
People:
Believe in capabilities of individual members, Kia helps
them to develop their potential theur talent in a
corporate culture of respect.

Positionning

Marketing Mix
PRODUCT
Good design and quality alongside a high level of customer service, Kias unique selling
point is its 7-year warranty. Design, Technology, Value, Usefulness, Quality, Accessories
PLACE
With 166 dealerships there is a large and expanding number of outlets
Retail shops, Wholesale, Mail order, Direct sales, Multi channel
PRICE
Competitive prices provide an advantage over competitors. Strategies, Penetration,
Skimming, Cost plus
PROMOTION
This includes a new sponsorship in cricket and long-term partnerships in football and
tennis.
Special offers, Advertising, Endorsement, Direct mails, Sport sponsor

SWOT Analysis
STRENGTHS

One of South Koreas largest Automobile

producer
Among the top 5 Largest Automobile
manufacturer based on its sales
It has strong presence due to its
sponsorship to events like the formula 1,
Euro Cup, Australian Open, FIFA World Cup,
X-Games in US
Around 42 000 employees
Good product portfolio and strong brand
presence
Has sales of nearly 1,5 million car per year

OPPORTUNITIES

Venture into emerging economies which a

huge market
It can also enter various where Hyundai is
present to fill up gaps in the product
offering which Hyundai cannot
Enter the defence market in the newly
liberalized countries of the Jasmine
Revolution since it already is existing in
the Defence sector
Their all electric vehicles like the Venga &
Pop City can open new avenues of

WEAKNESSES

Past recall of critical components like the

braking system was a concern
Has not leveraged its presence &
recognition globally even as it has created
so many sponsorships
Has not expanded aggressively in terms of
the geographic reach

THREATS

The Japanese players have made their

presence in most of the markets around
the World and secured steady market
shares
The competitors have better design and
technology thus having better
differentiation like Toyota, Honda and
Nissan which are the real competitors of
KIA

Financial Analysis

Net results Analysis

2009

Why does the activity is losing its rentability and net results is
negative in 2010?

2010

Actif
2009

2010

Customer financial debt increases from 230000 to 750000

2010
2009

Finiancial debt increase by 500 000 between 2009 and 2010

Passif
2010
2009

Equity is declining, it goes from 178 000 to 47

600
Moreover, others debts increased by 66000

Compte de resultats
2010

2009

Current pre tax profit is negative contrary to the previous year, and despite
production costs are increasing, the added value didnt move.
Net results in 2010 is negative, it goes from 98 000 to -130 700.

Business plan

Current situation
We are based in Saint Germain en Laye, population has been decreasing since 2006.

Less inhabitant its less potantial customers.

The citys situation:
49% married couples, 37% singles.
31% senior executives, 21% middle ranges, 19% clerks
53% between 25 to 65 years old
The average annual income is 55 140 (SPC+)
According to drimki

Balance Sheet Analysis of AMDS92

There is a problem here. The total I is below the half of the Capital, this is not supposed to
happen and it reveal a dysfunction in the management of shares.
According to the law, the shareholders have 6 months to find a solution after the end of the fiscal
year to make a decision, this situation can no longer be.
The solution would be to transfer a part of this deficit to the shareholders.
There are 3838 shares.
Capital = 247 012
To invest, we have to purchase shares or increase the capital.
The increase of the capital seems to be more likely.

Assumption
If we increase the capital, create shares of a value of 60 (2417 012/3838). We invest for instance
200 000
(200 000/60 = 3333 shares)
The value of shares after the increases of K = 195 362 / (3333+3838) = 27.24 (purchased 60)
If we play an accordion trick we put the increased capital in condition. We transfer half of the losses
to the capital which will be paid by the shareholders. (thanks to the law). That way we get half of the
losses transferred.
Losses = 263 807
losses = 131 904
Decreases the capital of 131 904
After playing the accordion, the shareholder's equities will be of -4698

This being said, we also have to decrease the number of shares because the capital is decreasing.
We would have to get rid of 2198 shares (131 604 / 60)

Recommendations
We need to reduce time of payment to 30 days to get back cash because it increased from
230 000 to
750 000 but being careful if the firm starts a marketing campaign with a
loan, on how many months. Its important to find cash, to pay the debts (+66 000).
We need to propose in priority middle range products because there is a lot of family, with
kids, they need space in the car and a reliable one. Also a high range because of
competitors (audi or porsche) and the 37% of singles which will not necessary want a 5
doors car but something more sporty like the PRO_CEED GT ; or the Picanto (more for
women).
Some of the employees might be paid less commercial team, maybe playing about a fix
salary and to work on commission. Also we dont need two receptionnaires in Saint
Germain. It would be too expansive to fire one of them , but maybe discussing about
retirement (enter date 02/10/1989, more than 25 years in the company).

Marketing recommendations:
The challenge for Kia has been to increase awareness of its brand within European
markets
Kia has to develop its brand identity
Improve the communication
To give a better brand image: Most of the time people do not think positive things
about KIA
To set up partnership abroad with good automakers
To align compared to its competitors: Toyota, Honda, Nissan which are the most
important
Improve the quality of the cars: In some cars the wheel vibrates which is dangerous,
moreover there is a lot of breakdowns
The After sales service is not good, there is too much complaints
To improve the Customer service: Too much waiting
To simplify the web site with less tabs

Other recommendations:
The distributor propose rentals and lising so payment are
over several months, Kia should demand payment at time
Normally, its BtoC, so they cash the client and send back
money to KIA but sometimes they forgot . The company
should be paid first before sending products.

Concerning the distributor based in Nanterre:

2 salesman are paid over 7000
1 saleman should be sufficient and company can drop
salary
Catch up with late tresurery of 5 days
Decrease average duration of suppliers credit ( 61days to
30 days)
Reduce global debt (98 days is too much)

Planning of Gantt
jan

feb

mar

apr

may

jun

jul

aug

sept

oct

nov

dec

Get back
cash
Dealing
with
retiremen
t

New cars

Conv
ocatio
n

procdure

Before summer for families and

singles

dpar
t