Genesis will be a young along with also still-obscure luxury brand, which has a complicated history, which’s currently going through a time of tremendous change.
The brand new upscale type via Korean carmaker Hyundai will soon begin rolling out its widely praised 2019 mid-sized G70. The sports sedan, which starts at around $32,000, will be competing head-to-head with different entry-level luxury versions, including the Mercedes C class or BMW 3 series.
Consumer Reports ranked the item the top automotive brand in February. the item then topped JD Power’s Initial Quality survey in June. Industry researchers AutoPacific, also which month, ranked a Genesis sedan highest in vehicle satisfaction.
although sales have fallen 50 percent over the last six months as the brand builds out an all-brand new network of U.S. dealerships along with also tries to differentiate itself via both competitors along with also its stablemates, Hyundai along with also Kia.
To make things even tougher, Genesis will be trying to sell sedans in a market which has tilted toward SUVs.
With the Genesis, Hyundai’s playing a long game. A very long game.
Within a month, Genesis will begin unveiling its brand new network of standalone dealerships, said Erwin Raphael, general manager of Genesis North America.
Genesis had long wanted about 100 separate stores to differentiate the brand via Hyundai. although the item wrangled with many from the network of 840 Hyundai dealers across the U.S, many of whom were upset they might not be able to continue selling Genesis vehicles.
Finally, the item appears to have arrived at a solution. Every dealer right now can choose between converting to selling Genesis, building a separate store or accept what Raphael said will be generous buyout offer.
The problem will be while This particular has been happening the company has had to stop production along with also hold off on marketing the brand. The tight inventory has killed sales, Raphael said.
“We are not concerned about our sales at all,” he said. “This particular will be a process we have to go through to build a stronger foundation for Genesis.”
The G70 will start hitting dealerships in August, soon after the announcement.
The G70 will be Genesis’s third vehicle, along with also the item will be the first developed entirely by the separate Genesis group within Hyundai. the item has drawn comparisons with smaller German sport sedans, such as the BMW 3 Series along with also the Audi A4.
Kelley Blue Book senior analyst Rebecca Lindland drove the auto in Korea in late 2017.
“the item was impressive,” Lindland said. “I think people are going to be blown away by the item. The challenge will be getting people to consider the both the brand along with also vehicle.”
Only about 3 percent or 4 percent of consumers shopping on Kelley Blue Book, for example, are looking at the brand, she said. which contrasts with BMW, which attracts about 30 percent of Kelley Blue Book shoppers.
Genesis’ lower-priced sister brands Hyundai along with also Kia attract about 20 percent along with also 15 percent, respectively, of shoppers on the site.
“I think the G70 can easily take on the 3 Series,” she said. “You just have to get on which consideration list.”
Raphael said lack of awareness will be the brand’s biggest challenge right right now, although which the item does not make sense to focus on building brand awareness as the item was going through the transition with its dealership network. He said even their own data have shown which just up to 6 percent of shoppers are aware of the brand.
Raphael said Genesis plans to cast a wide net for brand new customers, looking beyond traditional luxury car buyers.
“In fact when we look at customers who can afford to buy luxury vehicles, a full 83 percent of them do not buy luxury vehicles at all,” he said. “So there isn’t a need to fight over the 17 percent who do buy luxury vehicles.”
Genesis will be also competing in segments which have been steadily shrinking: sedans.
Cars made up 56 percent of all premium vehicles sold from the United States in 2011, according to IHS Markit. By 2017, which share had shrunk to about 40 percent. SUVs did almost exactly the opposite from the which same period, going via 40 percent in 2011 to 57 percent in 2017.
The brand has already announced the item will make two different SUV vehicles, although has not released any details on them.
“For better or worse, they are starting sedan products,” Brinley said. “You can get to volume faster with SUVs along with also crossovers.”
At the same time, getting to volume quickly will be not as important as getting the relationship with customers right, as the company will be trying to do with its focus on dealerships, she said.
along with also the shift to SUVs has been more rapid along with also dramatic than many from the industry had thought, she added. along with also the pendulum could swing from the different direction back toward sedans, she said.
Furthermore, if Genesis actually will be from the item for the long haul the item will have to build out a full lineup of cars no matter what they start with.