- Hyundai wants to put a more premium spin on its future Hyundai Equus and Genesis, but is stopping short of creating a separate brand for the rear-drive cars.
- A Hyundai executive told Edmunds that styling and service will be two ways the automaker will differentiate the Equus and Genesis from its more mainstream lineup.
- It is uncertain whether all Hyundai dealers will continue to sell the Genesis sedan and coupe when those models are redesigned.
While those models are aimed at such vehicles as the BMW 5 Series and Mercedes-Benz S-Class, Hyundai has no plans to move those models out of dealerships and create a separate brand for the Equus and Genesis models.
Instead, as cars are redesigned, "I think you will see some distinguishing features and elements in terms of our premium cars versus some of our non-premium cars," Ricky Lao told Edmunds. Lao is Hyundai Motor America's senior product planning manager for premium rear-wheel-drive cars.
"Styling could be one," Lao said. "Service could be another. So those could be some points to look at in the future."
Lao spoke to Edmunds during a recent event here for the 2014 Hyundai Equus.
Unclear is whether all Hyundai dealers will continue to sell the Genesis sedan and coupe when those models are redesigned or whether Genesis sales will be limited to a select group of dealers who are authorized to sell Equus.
Hyundai has said the redesigned Genesis sedan will debut next year, as will the redesigned Sonata. The redesigned Genesis coupe is expected a year later and the redesigned Equus is likely to appear in 2016 or 2017, industry sources said.
In the meantime, industry analysts say Hyundai continues to face at least two obstacles as it tries to expand the brand upmarket. The first is credibility: specifically, drawing luxury car buyers to a showroom historically known for econoboxes. The showroom is still filled with relatively low-priced cars.
Second is styling: The current Equus design appears to borrow cues from the Lexus LS, and the Genesis lacks that head-turning, got-to-have appearance that makes it stand out in the showroom, let alone on the street.
The 2014 Equus' exterior has been lightly freshened. A redesigned instrument panel has been added along with several new standard safety features. Sales begin this month. The redesigned 2015 Genesis sedan will debut next year. The HCD-14 Genesis concept unveiled earlier this year suggests head-turning styling is on the horizon.
Hyundai sold 3,972 Equus vehicles last year, but sales this year are dropping off. For the January through June period, 1,527 Equus vehicles were sold, a 23 percent drop from the same period last year. As for Genesis, sales totaled 33,973 vehicles last year. However, sales for the six-month period this year were 16,402, nearly a 14 percent drop from the year-earlier period. Redesigned models are needed to stimulate sales, industry analysts say.
Hyundai's showroom ranges from the 2013 Accent, which carries a $15,340 sticker price including $795 transportation, to the 2014 Equus Ultimate, $68,920 with $920 transportation. The Equus Signature is $61,920 including transportation. Pricing for the 2014 Accent has not been released.
Hyundai says the Equus' primary targets are Lexus LS and Mercedes-Benz S-Class buyers. The 2013 Lexus LS 460 stickers for $72,885 including $895 for transportation, while the gasoline-powered Mercedes-Benz S550 is $96,810 including $905 for transportation. Secondary targets are the Audi A8 and BMW 7 Series.
Meanwhile, the Genesis sedan is aimed at Lexus GS, Mercedes-Benz E-Class and BMW 5 Series buyers. The 2013 Genesis carries a $35,095 sticker including $895 for transportation. The 2014 price has not been announced. The 2013 Lexus GS 350 stickers for $48,145 including $895 transportation. The gasoline-powered 2014 Mercedes-Benz E-Class is $52,825 including $925 transportation.
Locating an Equus takes some time, as not all Hyundai dealers sell the car. Of Hyundai's approximately 800 U.S. dealers, Lao said about 400 dealers sell the Equus. Those dealers represent about 75 percent of Hyundai's U.S. sales volume, according to Hyundai.
Hyundai requires those dealers to provide such things as a "showroom within a showroom" to display the car, a dedicated salesperson and a concierge service to pick up the car at a customer's home or business when it needs service, he said. Equus shoppers do not need to share the showroom or service department with an Accent, Elantra or any other Hyundai nameplate.
By contrast, the Genesis, which is trying to woo BMW 5 Series and Mercedes-Benz E-Class shoppers, is sold by the entire dealer network, and the sales and service experience is no different than for the purchaser of an Accent.
Asked if future Genesis models will be limited to dealers that sell Equus, Lao said, "At this point, no change is planned." He did not elaborate.
Edmunds says: Maybe it's time for Hyundai to seriously consider the need for an upscale brand along the lines of Acura, Infiniti and Lexus.