Kia Australia committed to first diesel ute despite looming emissions rules - SUV VEHICLE

Kia Australia committed to first diesel ute despite looming emissions rules

The first Kia ute – a heavy-duty, dual-cab diesel workhorse – is due at the same time as strict emissions targets for new cars, but the company says it will offset it with growing sales of hybrid and electric cars.

Kia has expressed no intention to pull the plug on its first dual-cab diesel ute in Australia despite upcoming emissions standards set to penalise manufacturers for selling new high-emissions vehicles.

The South Korean car giant says it intends to tweak its showroom line-up – and roll out hybrid and electric cars – to offset the biggest polluters in its range, including the new ute.

It says it doesn’t want to be forced to pay fines for not beating emissions targets – nor pass them onto customers, like brands such as Toyota – but would not specify which option it would choose if it was unable to meet the rules.

The first shipments of the Kia ute – expected to be called Tasman – are due in mid-2025, just as the Australian Government starts tracking the CO2 emissions of every new vehicle on sale.

MORE: How Australian new-vehicle emissions rules have been eased to help utes, 4WDs

“Whatever the legislation is, Kia Australia will be ready. We’ll accept what it is, and get on with selling cars in Australia,” Damien Meredith, CEO of Kia Australia, told Drive.

Technical details of the Tasman are yet to be revealed, however it is expected to launch with a 2.2-litre turbocharged four-cylinder diesel engine without any form of hybrid assistance.

Key four-cylinder rivals emit between 190 and 210 grams per kilometre of CO2, which would make them compliant with the rules in 2025 when the ‘headline’ CO2 target for utes is 210g/km – but in the red in 2026 when the target is 180g/km.

Asked about the timing – and public perception – of launching what’s likely to be Kia’s least efficient diesel vehicle at the same time as stringent CO2 rules, Mr Meredith said:

“We’ve always taken a pragmatic approach to legislation, and a pragmatic approach to emissions. But the reality is there are 25, nearly 26 million of us – not everyone’s going to be driving an EV [electric vehicle] in the next decade. That’s a reality.

We need to be representative of what Australians require, and there’s a difference between wants and needs in that situation.

“So I think what we’re doing is the right way. We’ve got a very strong staple of electric vehicles here and coming, but we also understand that the requirements of Australians is far broader than the narrow parameters at the moment of what EVs can do.”

Hybrid power is under consideration for later in the Tasman’s life cycle, but it is not confirmed.

Meanwhile Kia expects to sell 10,000 examples of the EV5 – a mid-size electric SUV rivalling the Tesla Model Y – which will help offset less efficient vehicles in its range.

Mr Meredith said the emissions standard for new vehicles in Australia – known as the New Vehicle Efficiency Standard (NVES) – will help direct more stock of Kia hybrid and electric cars to local showrooms.

“Kia globally are very responsive to [emissions rules] because they’ve had the experience in Western Europe, and they’ve had the experience in North America.

“They know what’s required, and they’re being very responsive to requirements since the proposed legislation’s been announced. So to answer your question, yeah [we will get improved supply of hybrid and electric cars].”

Drive‘s interview with Mr Meredith occurred minutes before a revised version of the New Vehicle Efficiency Standard was announced, with less stringent limits for utes and vans – and the re-classification of some large 4WD SUVs as commercial vehicles.

Asked if Kia Australia could meet the government’s original proposal without any changes, Mr Meredith said: “Yes.

“It doesn’t matter what the legislation is, that will be our aim to ensure that we meet our volume requirements and the customer requirements without paying a fine or buying credits [from other car makers which meet the targets].”

Kia Australia general manager of product planning, Roland Rivero, said: “At the end of the way, we’ve got a diverse product range and we don’t have all our eggs in any one particular basket.

“Having that diversity is a big component of our ability to continue on, irrespective of whatever legislation comes our way.

“We’ve got electric products, we’ve got hybrid products and we’ve got internal combustion [petrol and diesel] products, and somewhere in that mix is an ability to offset [any high-emissions vehicles] on our own.”

If Kia Australia was unable to offset polluters in its line-up – and was forced to pay a fine – Mr Meredith would not say if it would be passed onto customers in the form of price rises for new vehicles, or absorbed by head office.

“Our preference would be to have a mix of sales that meets the requirements that we don’t pay, and we don’t pass on,” he said when asked which option would be Kia’s preference should that situation arise.

Estimations by Drive based on sales data show that – if the 2025 CO2 targets were in place in 2023 – Kia would have paid $52 million in fines for the number of Sportage family SUVs it sold last year, and nearly $22 million for the Cerato small cars it sold.

However 10,000 EV5 sales in a calendar year – based on the same CO2 targets planned for 2025 – would mean the equivalent of $150 million in credits, which would almost single-handedly offset every petrol, diesel and hybrid car the company sold in 2023.

The post Kia Australia committed to first diesel ute despite looming emissions rules appeared first on Drive.

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