Kia Motors Corporation

Kia should be more transparent about its R&D spending. Automotive manufacturers rely heavily on R&D to drive down the costs of low-carbon technologies and increase the market penetration of such technologies. The company committed to spend USD 25 billion on its transition plan, but little detail of where this will be spent on is provided. As only 1.8% of the vehicles it sold in 2020 were low-carbon, financial commitment to spend on low-carbon technologies is required for transition.

Kia’s sales of low-carbon vehicles slowly increased from 0% of total vehicle sales to 1.6% in 2019, with a more rapid increase to 2.7% in 2020. However, this was not enough to meet its 1.5°C pathway in 2020. Kia aims to sell 500,000 electric vehicles per annum by 2030 which equates to approximately 25% of sales volume. In contrast, Kia’s 1.5°C pathway expects the company to have 64.5% by 2030.

Kia has a target to reduce its absolute scope 1 and 2 emissions by 46% by 2030 compared to 2019, which is not ambitious enough to align with its 1.5°C pathway. Its target to reduce absolute scope 3 emissions by 56.6% by 2035 is also not ambitious enough for its 1.5°C pathway. These targets are not approved science-based targets. In the company’s Sustainability Report 2021, Kia states that it is working on a carbon neutrality strategy to be released in 2021. The company should engage with the Science-Based Targets initiative to set more ambitious targets within this plan.

Kia is aiming to reduce its absolute scope 1 and 2 emissions by 46% by 2030 compared to 2019. The company is also aiming for a 56.6% reduction in scope 3 emissions intensity by 2035 compared to 2019.

Kia has set low-carbon vehicle sales targets of approximately 25% by 2030. It has committed to spending USD 25 billion on its transition plan to 2025 but does not disclose where this will be spent on. Kia uses internal carbon pricing to inform its decisions.

In 2020, 2.7% of Kia’s sales were low-carbon vehicles. The company did not disclose what proportion of its R&D expenditure went to low-carbon innovation in the 2020-2021 financial year.

Kia’s scope 3 emissions intensity decreased from 93.5 grammes CO2 per passenger kilometre (gCO2/p.km) in 2015 to 91.8 gCO2/p.km in 2020. The company saw a marginal increase in scope 1 and 2 emissions intensity between 2015 to 2020.

The company’s actions over the past five years have not led to meaningful reductions in emissions or a significant increase in low-carbon vehicle sales. Kia’s plans to reduce emissions would be improved by setting science-based targets.