Kia's new compact, tech-heavy SUV plays into a hot trend in Australia – as inner-city millenials drive the growth of smaller vehicles

While growth in the sale of small SUVs was minimal in 2019 (up 0.1 per cent on 2018), overall growth in the sector is still trending up. Between 2011 and 2019, there has been consistent upward growth in sales results.

Kia Australia’s Marketing GM, Dean Norbiato, told Business Insider Australia that the company is well aware of the demand, evidenced by its new tech-heavy compact SUV, the Seltos, which has been performing well since its release in October 2019.

Norbiato told Business Insider Australia that the Seltos has "had three times more preregistrations than any car" in the company's Australian history.

A small or compact SUV serves the market between standard SUVs and small to medium-sized cars. They’re generally easier to maneuvre compared to larger SUVs, but still have practical utility – like increased boot space.

Across the board, Chief Operating Officer Damien Meredith says the small SUV market "shows no indication that it is going off the boil," provided consumers continue to see a need for the category. Put simply, the trend is there thanks to market demand.

"It is one of the market segments in which there has been growth for the right products," he told Business Insider Australia.

"I think it is pretty clear that the market will tell you if you have the right product. In the case of Seltos, being a little late to the party has allowed us to present something to meet what the market has been asking for."

The Seltos is a tech-heavy compact SUV marketed towards younger city-dwellers who are after the space of a larger car with the advantages of a smaller frame and easier handling. They start at $25,990 – with the top model costing $41,990 – making it an affordable option for drivers ready to upgrade to something a little bigger or more premium.

"Like all our cars, the Seltos was specifically tuned for Australian conditions, meaning it handles more like a sporty small car than a traditional SUV," Norbiato said.

While Kia's entry into the small SUV market has been a late one, the Seltos has made a substantial impact in a short time, with RACV calling it the best small SUV of 2019 under $40,000, while CarAdvice has it at number 3 on its list.

“The thing we are being told about Seltos, both from customers and the media, is that it meets or exceeds expectations across all key metrics and that can be seen in the swift acceptance of the car in the market,” Norbiato said.

Meredith says the wait wasn't due to uncertainty around entering the segment, but rather waiting until Kia had the right product for it. "It has been obvious for some time that the smaller SUVs have a real place in the Australian automotive landscape," he said.

“Seltos is such an important car to us as it fills a gap in a segment which is growing and in which we have never had a presence.”