KG Group chairman vows to take K Car global, pledges 50% shareholder return

KG Group is building an integrated mobility ecosystem — spanning vehicle manufacturing, used-car retail, finance and payments — on the back of its acquisition of K Car, South Korea's leading used-car platform. The group also unveiled a value-up policy to return 50 percent of net profit from its listed affiliates to shareholders over the next five years.

KG Group Chairman Kwak Jae-sun said Tuesday at a press briefing at T Art Hall in Yeouido, Seoul, that the acquisition goes well beyond the domestic used-car market. "We believe the K Car platform can be deployed in overseas markets as well," he said.

The group also laid out a concrete integrated mobility strategy anchored by the K Car deal. Under a two-track structure, KG Steel will oversee K Car while KG Inicis handles K Car Capital, sharpening the group's expertise in used-car retail and auto finance respectively.

The plan combines KG Mobility's vehicle manufacturing capabilities with K Car's online and offline used-car distribution network and the payment and fintech services of KG Inicis and KG Financial. It connects every stage of a vehicle's life cycle — from selection and purchase to financing, payment and after-sales care — within the group. The strategy aims to deepen vertical integration among affiliates and develop used-car retail and auto finance into new revenue streams.

KG Group signed a deal in April to acquire K Car — South Korea's largest directly operated used-car platform — and its captive finance arm K Car Capital from private equity fund Hahn & Company for approximately 750 billion won (about $545 million). The Korea Fair Trade Commission's merger review is currently under way, and the transaction is expected to close by the end of this month once the review is complete.

"A new car is sold once and that's the end of it, but a used car can change hands two or three times," Kwak said. "The buying, selling, maintenance and commercialization platform that K Car has built is more than competitive enough to succeed in overseas markets."

Kwak also noted synergies between K Car and KG Mobility. "KG Mobility already runs a certified pre-owned business, but it's limited to KGM vehicles," he said. "With K Car, we can expand that to every make and model."

He added that K Car's leasing and rental business could be linked to KGM vehicle sales, and that the nationwide service network could support a vehicle commercialization business.

KG Group also announced a shareholder return policy aimed at restoring corporate value.

"We will return 50 percent of net profit from our listed affiliates to shareholders over the next five years," Kwak said, adding that the group would share results with the market through expanded dividends and treasury share policies.

The policy applies to major listed affiliates including KG Chemicals, KG EcoSolution, KG Steel, KG Mobility, KG Inicis and KG Financial. K Car is also expected to follow the same policy framework once the acquisition is finalized.

"The market value of KG Group's affiliates is not being adequately recognized relative to their earnings and financial soundness," Kwak said. "Corporate value is ultimately judged by performance and communication with shareholders, and we will restore market trust through execution-driven management."

Group affiliates also unveiled their medium- and long-term growth strategies at the event.

KG Mobility set targets of 200,000 vehicles sold annually, 10 trillion won in sales and a 5 percent operating profit margin by 2030. To reach those targets, the automaker plans to expand its knock-down assembly business in Vietnam, Saudi Arabia and Indonesia, and to roll out seven eco-friendly SUV models — covering electric, hybrid and plug-in hybrid powertrains — in sequence.

The company will lead that lineup with the SE10, a plug-in hybrid SUV set to launch in January next year, targeting the mainstream domestic SUV segment. KG Mobility aims to capture more than 20 percent of the domestic market with the SE10 and sell 60,000 units annually in global markets.

The group is also accelerating its overseas production footprint. In Vietnam, it will work with a local partner to bring a production facility with annual capacity of up to 15,000 units online in September. In Saudi Arabia, local mass production of the Musso pickup will begin in August, targeting the Middle East pickup truck market. In Indonesia, KG Mobility plans to partner with local defense manufacturer Pindad to grow the B2G military vehicle segment and expand into a national car project.

KG Chemicals will pursue the Southeast Asian fertilizer market and build eco-friendly fuel storage infrastructure, constructing a 200,000-kiloliter storage facility at its Onsan plant in Ulsan over the next three years to internalize a green energy value chain.

KG EcoSolution set a target of 700 billion won in sales by 2030 through expansion of its bio bunker fuel business, aiming for average annual growth of more than 40 percent in the global eco-friendly marine fuel market.

KG Steel plans to deploy generative AI and agentic AI across its production operations by 2029, building an AI-based smart factory. The company is also reviewing plans to construct a roughly 30-megawatt data center on the grounds of its Incheon factory.

KG Inicis will develop cross-border e-commerce from Japan, foreign exchange trading and digital currency as its future growth pillars. KG Financial plans to expand its B2B early settlement service for e-commerce sellers, targeting 1 trillion won in transaction volume by 2028.

KG Group said it will step up market communication through regular investor relations activities and will continue to disclose progress on each affiliate's growth roadmap.

"Corporate value is not built on grand rhetoric — it is ultimately judged by performance and communication with shareholders," Kwak said. "Drawing on KG's DNA of turning around distressed companies, we will correct the market's undervaluation through execution-driven management that builds intrinsic value, not just scale."

"The K Car acquisition is not simply a business expansion — it is the core pillar of the group's future growth strategy," he added. "We will build a new growth model connecting manufacturing, retail, finance and payments, and secure competitiveness in global markets as well."