Kia Corporation today welcomed Moody’s Investors Service (Moody’s) upgrade of the company’s corporate rating to A3 with a stable outlook from a previous rating of Baa1 with a positive outlook.

According to the report from Moody’s, the rating upgrade reflects Kia’s continued profitability and balance sheet improvements, underpinned by the company’s strengthened product competitiveness and strong free cash flow generation. Moody’s also cited that Kia’s profitability will remain robust and the company’s substantial financial buffer will stay largely intact over the next one to two years, notwithstanding the increasing difficulties in the global automotive industry.

“Kia has achieved substantial improvements in profitability through strengthened product and cost competitiveness by securing investment efficiency,” said Woo Jeong Joo, Executive Vice President and CFO of Kia Corporation. “We will continue to proactively respond to future technological trends and focus our efforts to further enhance financial soundness."

Furthermore, Moody’s also mentioned that the A3 rating reflects Kia’s strong position in the Korean automotive market, competitive position in key overseas markets, high degree of geographic diversification, very low financial leverage and strong balance sheet.   

In the meantime, Hyundai Motor Company and Hyundai Mobis also received an upgrade of the companies’ corporate rating from Baa1 with a positive outlook to A3 with a stable outlook.