The Kia EV9 is a genuinely impressive car. In a field of look-alike 3-row SUVs, it stands out. Its angular, almost fractal design theme looks like nothing else on the road (though Kia plans to migrate it across its lineup of electric SUVs, starting with the upcoming EV5). And, as the first 3-row electric vehicle (EV) from a non-luxury automaker, it’s in a class by itself at the moment.
It seems likely to sell extremely well, and Kia knows it. That’s the worry.
CarsDirect reports, “Kia is politely asking dealers not to mark up its highly anticipated EV9.” CD says it obtained a letter sent to Kia dealers that reads, “The EV9 customer is an important new owner to the Kia brand, and price transparency will be paramount as part of their purchase experience. We ask dealers to retail the EV9 without markup over the manufacturer’s suggested retail price.”
Car Builders and Dealers Sometimes Scuffle Over Prices
It’s been a year or so since we’ve seen an automaker struggle with its dealers. But the phenomenon isn’t rare.
Automakers (except a few newer, EV-only companies like Tesla and Rivian) don’t own their dealerships. The two have complex relationships. Dealers are partner companies that buy cars from factories to resell to the public, often borrowing money from a bank owned by the automaker. Many dealers are themselves making monthly payments on the vehicles on their lots until they sell.
That means the factory doesn’t set the final sale price. Dealerships do. With an in-demand product, they can often successfully sell cars for more than the manufacturer’s suggested retail price price.
In 2022, as a worldwide shortage of microchips led to a scarcity of new vehicles, some dealers charged significant markups. Automakers have no control over that but know it hurts their reputations. Many publicly feuded with their dealers over prices.
Some even threatened to withhold popular models from dealerships that significantly overcharged.
We haven’t seen that phenomenon in 2023. But, if the EV9 proves as popular as the South Korean automaker thinks it might, markups could be a problem.
Kia’s products have improved dramatically over the last decade. Some of the most popular cars in America are now Kia models, and the brand took home two of our 2023 Best Buy Awards, with its Seltos subcompact SUV and Telluride 3-row midsize SUV winning their categories.
But, in some areas, the experience of buying from a Kia dealer hasn’t caught up to the improving quality of the cars. In J.D. Power’s 2023 Dealership Experience Survey, the brand placed 27 out of 31.
