Kia’s Q3 profit down due to lawsuit settlement

Korea JoonAng Daily website reports, “Kia reported 458.9 billion won ($320 million) in net profit in the third quarter, significantly lower than a market consensus of 1.07 trillion won compiled by market tracker FnGuide.” The $320M USD net profit is down 60% on year. The decline is primarily due to accounting provisions as the company has provisioned $1B USD to address complaints over its Theta II direct injection (GDi) gasoline engine.

The Theta II GDi 2.4L can be found in the Kia Cadenza (2011–2019), Kia KX7 (2016–2021), Kia Optima (2010–2019), Kia Sportage (2010–2021) and Kia Sorento (UM) (2014–2020), Hyundai Grandeur/Azera (2011–2019), Hyundai Santa Fe (2012–2020), Hyundai Sonata (2009–2019) and Hyundai Tucson (TL) (2015–2020); whereas the 2.0L version powers the Kia KX7 (2016–2021), Kia Optima (2011–2019), Kia Sorento (UM) (2015–2020), Kia Sportage (2011–2021), Kia Stinger (2017–present), Hyundai Elantra N (2021–present), Hyundai i30 N (2018–present), Hyundai Kona N (2021–present), Hyundai Santa Fe (2012–2020), Hyundai Sonata (2009–2019), Hyundai Veloster N (2018–present), Genesis G70 (2017–present) and the Genesis G80 (DH) (2017–2020).

A U.S. federal court granted final approval of a class action lawsuit alleging Theta II GDi equipped vehicles may suffer from a defect which can cause engine seizure, stalling, engine failure, and engine fire, and that engine seizure or stalling may be dangerous if experienced, and that some owners and lessees have been improperly denied repairs under the vehicle’s warranty.

Kia has not been found liable for any of the claims alleged in these lawsuits however the parties have instead reached a voluntary settlement in order to avoid a lengthy litigation. Individuals who owned or leased Class Vehicles may be entitled to compensation if they submit valid and timely claims that are approved pursuant to the review process.