Meghna Automobiles Ltd, a concern of Meghna Group, is working to assemble passenger cars of South Korean automobile manufacturer Kia in Bangladesh, said a top official.

The company is planning to launch in January in a bid to grab a slice of the growing domestic automobile market.

 Meghna and Kia have already established an assembly plant for complete knock-down (CKD) production across 15 acres of land at Barmi union of Gazipur.

Meghna Automobiles Ltd has invested around Tk 275 crore (around $25 million) to set up the plant with a view to providing brand-new cars to customers in Bangladesh.

"We will start to assemble four models of sport utility vehicles (SUVs) -- including Kia Sportage, a class-leading, sub-compact SUV model -- in December and bring them to the market in January," said Anisuzzaman Choudhury, executive director of Meghna Automobiles Ltd.

According to Choudhury, the price of a brand-new car will cost around Tk 10-12 lakh less than imported Kia cars, depending on the model.

To ensure the same quality as cars of Korean origin, the plant will be operated by Korean engineers and technicians for the first two years.

Currently, Hyundai, South Korea's leading automobile manufacturer, Proton, the pioneering automotive company of Malaysia, and renowned Japanese manufacturer Mitsubishi assemble passenger cars in Bangladesh.

Despite the market being historically dominated by imported reconditioned cars from Japan, brand-new cars now hold around 18 percent of the market share, according to market insiders.

Just five years ago, brand-new cars held at best a five per cent share, they added.

According to data from the Bangladesh Road Transport Authority (BRTA), an average of 22,000 to 24,000 passenger cars, including SUVs, were sold per year since 2014.

Sales of SUVs and luxury cars have been increasing for the past five to six years alongside rising income levels. Another reason for the rise is that SUVs are more suitable for long drives given the condition of roads in Bangladesh, according to market players.

Having observed this situation, Kia decided to assemble in Bangladesh SUVs to grab a share of the growing market, Choudhury said.

According to market players, sales of passenger cars have been in the slow lane recently as demand for high-end automobiles has fallen significantly amid the ongoing economic crisis due to the impacts of the Russia-Ukraine war.

Given that backdrop, Kia also aims to improve the knowledge and skills of automotive professionals in Bangladesh.

In this regard, Kia Corporation, South Korea, and Meghna Automobiles Ltd signed a memorandum of understanding (MOU) at Le Méridien Dhaka yesterday to establish a training centre in Bangladesh.

Among those present were Park Young-Sik, ambassador of the Embassy of the Republic of Korea in Bangladesh, Rashiqur Rahman Mahin, director of Meghna Automobiles, Md Abul Kalam Azad, managing director of Pragoti Industries Limited, Dato Samson Anand George, vice-president of Kia Asia Pacific (APAC) and Jay Park, coordinating director of Kia APAC.

Under the MoU, Kia Corporation will provide support to establish a training centre in Bangladesh and provide specific vehicle models for training purposes, Choudhury said.

According to Choudhury, the centre will provide a gasoline engine and an automatic transmission alongside diagnostic tools and scanners like KDS 2.0 and CVCI-301 for training purposes.

It will also provide training on equipment such as a KDS tool trolley, AGM battery charger, air reel wire, electric reel wire, and an air compressor, along with a storage cabin for mobile maintenance vehicles to provide service to Kia customers, he said.

Besides, it will also use virtual reality devices such as the Meta Quest2 to enhance the training process.

The training will cover various topics, including TRP (Technical Repair Process) basic training, training related to new Kia vehicle models, EV (Electric Vehicle) diagnosis training, VR training and advanced diagnosis training using D-Logger technology.

"We believe Kia Training center will play important role to create skill workforce for Bangladesh to help generating more productivity that helps the economy indirectly," said Samson Anand George, Vice President of Kia APAC.