View Poll Results: What strategy should Hyundai adopt in its bid to move further upmarket?
Status Quo – Continue selling all models under the Hyundai name as it does currently
4
17.39%
Create a sub-brand, possibly named Genesis, with a showroom-within-a-showroom concept
7
30.43%
Spin off a stand-alone premium brand with its own dealerships like Toyota has done with Lexus
12
52.17%
Voters: 23. You may not vote on this poll
Hyundai considering more luxury models, seperate luxury brand
12-08-2010, 12:07 PM
#1
Senior Moderator
Thread Starter
Hyundai considering more luxury models, seperate luxury brand
http://www.autoblog.com/2010/12/08/r...perate-luxury/
First the Genesis sedan, then the Equus. Clearly, Hyundai is pinning its ears back and charging upmarket like Ndamukong Suh rushing Aaron Rodgers. And, like the rookie Husker-bred defensive end, the Korean automaker is making a rather successful transition to the next level. What's next? Quite possibly a sedan designed to compete directly with the benchmark entry-level luxury sedan, the BMW 3 Series. After that, Hyundai may craft a crossover to go up against the segment-defining Lexus RX CUV.
According to a new report from The Wall Street Journal, Hyundai isn't nearly done refining the image of its top-level nameplates. Hyundai USA head John Krafcik told the WSJ in an interview that the automaker is actively considering whether it should break its premium models apart from the rest of its lineup, much in the same way Honda does with Acura, Toyota does with Lexus and Nissan does with Infiniti.
While this isn't exactly news, Krafcik's level of candor is. Three options are apparently on the table. First, an entire separate dealer network could be created to sell these Genesis-branded machines, but this would be very costly. Second (and reportedly most likely), a subset of the automaker's current set of dealers could add a section to their dealerships designed to cater specifically to upmarket clients – a showroom-within-a-showroom, if you like. They could even have their own dedicated employees. Lastly, Hyundai could stick with its current scheme of training at least one salesperson on the Genesis line, leaving the dealerships alone.
Whichever way Hyundai chooses to move, don't expect any hasty decisions. Krafcik says the company will keep a close eye on the success of its Equus sedan in the States before making any judgments on its dealer network. In the meantime, expect Hyundai to unveil a new global branding strategy at the 2011 Detroit Auto Show along with a slogan to replace the current "Drive Your Way" message.
One thing is clear: this decision will shape the way forward for Hyundai's continued performance in the United States. We're keenly interested in your take on the matter, and we know the automaker's execs are listening, too. What strategy should Hyundai adopt in its bid to move further upmarket? Make yourself heard in our informal poll below, as well as in Comments.
According to a new report from The Wall Street Journal, Hyundai isn't nearly done refining the image of its top-level nameplates. Hyundai USA head John Krafcik told the WSJ in an interview that the automaker is actively considering whether it should break its premium models apart from the rest of its lineup, much in the same way Honda does with Acura, Toyota does with Lexus and Nissan does with Infiniti.
While this isn't exactly news, Krafcik's level of candor is. Three options are apparently on the table. First, an entire separate dealer network could be created to sell these Genesis-branded machines, but this would be very costly. Second (and reportedly most likely), a subset of the automaker's current set of dealers could add a section to their dealerships designed to cater specifically to upmarket clients – a showroom-within-a-showroom, if you like. They could even have their own dedicated employees. Lastly, Hyundai could stick with its current scheme of training at least one salesperson on the Genesis line, leaving the dealerships alone.
Whichever way Hyundai chooses to move, don't expect any hasty decisions. Krafcik says the company will keep a close eye on the success of its Equus sedan in the States before making any judgments on its dealer network. In the meantime, expect Hyundai to unveil a new global branding strategy at the 2011 Detroit Auto Show along with a slogan to replace the current "Drive Your Way" message.
One thing is clear: this decision will shape the way forward for Hyundai's continued performance in the United States. We're keenly interested in your take on the matter, and we know the automaker's execs are listening, too. What strategy should Hyundai adopt in its bid to move further upmarket? Make yourself heard in our informal poll below, as well as in Comments.
12-08-2010, 12:23 PM
#2
Fahrvergnügen'd
Here's my thing ... If I go spend $40k on a luxury car, I don't want it to be worth $20k in 2.5 years ... Things in life change and sometimes what was a good decision today becomes something that needs to be altered down the road.
If Hyundai is going to roll out a new sales model for the Genesis/Equus then they need to ensure that they aren't killing the resale market with cheap leases. I realize their job is to make money by selling new cars but one of the things that the big names benefit from is that they have good residual values. It means that buying one of their cars is not a huge financial risk (and isn't a sinkhole either).
If Hyundai is going to roll out a new sales model for the Genesis/Equus then they need to ensure that they aren't killing the resale market with cheap leases. I realize their job is to make money by selling new cars but one of the things that the big names benefit from is that they have good residual values. It means that buying one of their cars is not a huge financial risk (and isn't a sinkhole either).
12-08-2010, 12:42 PM
#4
Fahrvergnügen'd
Compared to a 3-series, they're horrific:
KBB Resale Value on base Genesis sedan
KBB Resale Value on a base 328i sedan
Basically, in order to not get hammered on the Genesis, you have to keep it five years if you bought it (not lease).
Looks like the Lexus IS has one of the best resale values in that price range as it's worth 12% more after five years than the Genesis is ...
KBB Resale Value on base Genesis sedan
KBB Resale Value on a base 328i sedan
Basically, in order to not get hammered on the Genesis, you have to keep it five years if you bought it (not lease).
Looks like the Lexus IS has one of the best resale values in that price range as it's worth 12% more after five years than the Genesis is ...
Last edited by charliemike; 12-08-2010 at 12:47 PM.
12-08-2010, 01:25 PM
#5
My first Avatar....
What's next? Quite possibly a sedan designed to compete directly with the benchmark entry-level luxury sedan, the BMW 3 Series.
12-08-2010, 01:55 PM
#7
The sizzle in the Steak
Showroom within a showroom concept.
Sorta like the BMW/MINI dealership concept.
Separate entrances, separate sales floor areas, separate service entrances & departments.....but all under "one roof - one property".
Much more simple than stand-alone brand dealership.
....but Hyundai does need to separate the "lux" brand if it wants to succeed.
There is still a lot of "stigma" with the Hyundai name....this effects the buyers perceived ownership experience, not to mention resale values.
It's all about the badge when it comes to lux. Sure, the Infinity (sp) is a Nissan, Lexus is Toyota...etc.....but to the buyer it's all about that badge....He's not driving a Nissan, he's driving an Infiniti.
Lux buyers don't want to drive a Hyundai, the same way lux buyers don't want to drive a Toyota.
Sorta like the BMW/MINI dealership concept.
Separate entrances, separate sales floor areas, separate service entrances & departments.....but all under "one roof - one property".
Much more simple than stand-alone brand dealership.
....but Hyundai does need to separate the "lux" brand if it wants to succeed.
There is still a lot of "stigma" with the Hyundai name....this effects the buyers perceived ownership experience, not to mention resale values.
It's all about the badge when it comes to lux. Sure, the Infinity (sp) is a Nissan, Lexus is Toyota...etc.....but to the buyer it's all about that badge....He's not driving a Nissan, he's driving an Infiniti.
Lux buyers don't want to drive a Hyundai, the same way lux buyers don't want to drive a Toyota.
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12-08-2010, 02:09 PM
#8
Your Friendly Canadian
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I think they should give it some serious thought (Obviously they are). I think the Genesis and Equus are high enough above the rest of the car's lineup that they could use a seperate brand. Add in a CL-Class or 6-series size coupe based on the Equus, and I think it would work well.
EDIT: There are many supposed stand-alone brands that are sold on the same property as their bretheren (i.e. over here 99% of Lexus dealerships are on the same property as Toyota dealerships). I think they could start off with a showroom within a showroom concept, and then start building stand-alone dealerships if they decide it's worth it.
EDIT: There are many supposed stand-alone brands that are sold on the same property as their bretheren (i.e. over here 99% of Lexus dealerships are on the same property as Toyota dealerships). I think they could start off with a showroom within a showroom concept, and then start building stand-alone dealerships if they decide it's worth it.
Last edited by Aman; 12-08-2010 at 02:11 PM.
12-08-2010, 03:22 PM
#9
registered pw
Join Date: Aug 2003
Location: south central pa
Age: 49
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show me the money.
Compared to a 3-series, they're horrific:
KBB Resale Value on base Genesis sedan
KBB Resale Value on a base 328i sedan
Basically, in order to not get hammered on the Genesis, you have to keep it five years if you bought it (not lease).
Looks like the Lexus IS has one of the best resale values in that price range as it's worth 12% more after five years than the Genesis is ...
KBB Resale Value on base Genesis sedan
KBB Resale Value on a base 328i sedan
Basically, in order to not get hammered on the Genesis, you have to keep it five years if you bought it (not lease).
Looks like the Lexus IS has one of the best resale values in that price range as it's worth 12% more after five years than the Genesis is ...
12-08-2010, 08:13 PM
#10
Burning Brakes
They should start a separate Luxury brand in about 5-7 years. By then the Hyundai stigma will have died down.
On the other hand, I have no idea how they're going to deal with all their new expensive models like the Gen, Veracruz, Azera and Eqquus. Discontinue them and leave a whole bunch of current owners pissed off? Rebadge them into the new brand? People will always find something to complain about.
On the other hand, I have no idea how they're going to deal with all their new expensive models like the Gen, Veracruz, Azera and Eqquus. Discontinue them and leave a whole bunch of current owners pissed off? Rebadge them into the new brand? People will always find something to complain about.
12-08-2010, 08:21 PM
#11
12-08-2010, 09:39 PM
#13
Senior Moderator
Here's my thing ... If I go spend $40k on a luxury car, I don't want it to be worth $20k in 2.5 years ... Things in life change and sometimes what was a good decision today becomes something that needs to be altered down the road.
If Hyundai is going to roll out a new sales model for the Genesis/Equus then they need to ensure that they aren't killing the resale market with cheap leases. I realize their job is to make money by selling new cars but one of the things that the big names benefit from is that they have good residual values. It means that buying one of their cars is not a huge financial risk (and isn't a sinkhole either).
If Hyundai is going to roll out a new sales model for the Genesis/Equus then they need to ensure that they aren't killing the resale market with cheap leases. I realize their job is to make money by selling new cars but one of the things that the big names benefit from is that they have good residual values. It means that buying one of their cars is not a huge financial risk (and isn't a sinkhole either).
Resale values for the Genesis are not too good right now.
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