KIA, the automaker that is selling an affordable SUV in the U.S. and Canada, has agreed to pay $150 million to its customers who purchase an SUV in an upcoming five-year period.
Kia said it expects to announce the settlement in the coming days.
The automaker said in a statement the settlement covers about half of the automakers estimated $150 billion in annual sales and that it expects the payout to be a meaningful boost to the company’s bottom line.
“Kia’s commitment to deliver affordable luxury vehicles to our loyal customers is unwavering,” said Kia’s CEO Peter Mansfield.
“We believe our partnership with the UAW represents a significant step forward in the transformation of Kia.”
The agreement is part of Kias commitment to address a long-standing challenge for the company: making premium cars affordable and reliable.
Kias vehicles have become increasingly difficult to find and increasingly expensive.
The company’s last premium SUV, the Kia Optima, was discontinued last year.
In 2018, the company said it plans to sell only about 10,000 Optimas a year.
Kiamas new premium SUV will be based on the KIA Optima SUV.
The Kia Sportage and Kia Versa, the smaller Kia Maxima, and the Kiamas Signature are being designed with the Optima in mind.
Kis commitment to making premium vehicles affordable and safe was recognized by the UMWB, a union representing some of Kiamias employees.
“I think Kia is going to be very proud to see their commitment to the safety of its customers, which is of paramount importance,” said UAW President Mike Hill.