After years of trying to stretch the original economy-minded Hyundai brand with new vehicles in the near-luxury and premium segments of the global auto market, the company finally has given in to its success and is launching a new Genesis luxury brand.
The new nameplate will be made up initially of Hyundai’s Genesis sporty sedan and its luxurious Equus full-size sedan, renamed G80 and G90, respectively, for the 2017 model year. The brand will target “savvy, affluent progressives, who are reasonable, progressive and young,” Euisun Chung, vice chairman of Hyundai, said in an announcement to journalists.
“We have created this new Genesis brand with a complete focus on our customers who want smart ownership experiences that save time and effort, with practical innovations that enhance satisfaction,” Chung said.
In the short term, the Genesis brand will piggyback on Hyundai’s existing showrooms, but Genesis will be sold through its own, separate sales channel later on. The Equus nameplate, whose list price starts at $60,000, is already sold at the 400 US Hyundai dealers in a “showroom within a showroom.”
Genesis will have its own R&D division and design studio, turning out new models on rear-wheel-drive platforms that are favored for luxury vehicles. And the brand expects to add a handful of new models over the next several years including its own crossover and SUV.
The move represents the climax of an important bit of corporate strategy that has been considered by Hyundai’s leadership since it introduced Genesis in 2008. Could they simply stretch a brand whose vehicles began as econoboxes at under $20,000 to include nameplates for $70,000 or more?
For years, Hyundai’s answer was “yes,” although it set up ways for its dealers to give Genesis and Equus buyers special treatment. But now, with luxury auto sales continuing to outpace mainstream sales on a relative basis, the company’s Korean leadership decided it was time to give premium buyers their own brand.
The move has implications for the entire Korean economy and its structure of chaebols, the industrial conglomerates that control it.
“Korea wants to take its place globally as a country that is producing premium products, and this goes hand in hand with that,” Don Southerton, a consultant on US-Korea business relations who works with Hyundai, told Automotive News. “Hyundai wants to be seen as a mature car brand.”