Hyundai Motor Co has revamped the luxury Genesis sedan for the first time since 2008, attempting to elevate its brand and grab a bigger share of US car sales as competition from US and European automakers erodes its dominance in its South Korean stronghold.
Since entering the US in 1986, Hyundai has carved out a niche with buyers looking for cheaper alternatives to Toyota Motor Corp’s big-selling Camry and Corolla marques. Sophistication, power and style have not been qualities typically associated with its brand, but now, South Korea’s largest automaker hopes to expand sales by competing more boldly with BMW, Mercedes-Benz, Toyota’s Lexus and other high-end models.
The new Genesis, unveiled yesterday, will be available in the US early next year and will be the first Hyundai luxury sedan sold in Europe. Y.J. Ahn, a director of Hyundai’s US business, said the redesigned sedan would help drive 10 percent growth in Hyundai’s US sales next year from 734,000 vehicles expected this year. The automaker’s US market share declined to 4.7 percent in the first nine months of this year from 4.9 percent last year.
“This is a chance to raise Hyundai’s image in the premium car market,” Ahn said.
Hyundai, which with affiliate Kia Motors Corp forms the world’s fifth-biggest car manufacturer, is in need of a boost.
South Korea’s free-trade agreements with the US and the EU have opened Hyundai’s home market to greater competition. Last year, almost one in every two vehicles sold in South Korea was made by Hyundai. Last month, Hyundai’s share had dropped to 42 percent.
Japan’s policy of weakening the yen has also given Japanese automakers a competitive edge in international sales. In addition, a series of Hyundai recalls in North America and Asia have hurt the automaker’s image.
Hyundai’s US car sales rose 1.6 percent in the first nine months of this year compared with overall growth in auto sales of 8.1 percent.
The new Genesis models will be sold at between 46.6 million won and 69.6 million won (US$43,900 and US$65,600) in South Korea. Prices for the US have yet to be announced, but the new models will be cheaper than cars from BMW or Mercedes-Benz, Hyundai officials said. Eventually, Hyundai thinks car buyers will not balk at paying a premium for the Hyundai name.
“Hyundai cars are known for good value for money, but such perception can no longer make us competitive,” said Park Joon-hong, a research fellow at Hyundai’s research and development division.
Hyundai, the maker of the Elantra compact and Tucson crossover, was the world’s 43rd most valuable brand this year, according to Interbrand, a consultancy. However, it is far behind the carmakers that Hyundai is trying to compete with in the luxury market. Toyota, Mercedes-Benz and BMW are in the top 12.
The redesigned Genesis comes packed with new features, technology, greater leg room and other improvements. It is Hyundai’s first all-wheel drive sedan, which should give greater stability on slippery roads and also appeal to drivers in regions with heavy snow, such as the US east coast.
Hyundai used more high-strength steel for better performance and safety. About 50 percent of the new Genesis is made of high-strength steel compared with 14 percent in the older model.