Hyundai has revamped the luxury Genesis sedan for the first time since 2008, attempting to elevate its brand and grab a bigger share of U.S. car sales as competition from American and European automakers erodes Hyundai’s dominance in its South Korean stronghold.
Since entering the U.S. in 1986, Hyundai Motor Co. has carved out a niche with buyers looking for cheaper alternatives to Toyota’s big-selling Camry and Corolla marques. Sophistication, power and style have not been qualities typically associated with its brand. 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 Tuesday, will be available in the U.S. early next year and will be the first Hyundai luxury sedan sold in Europe. Y.J. Ahn, a director of Hyundai’s American business, said the redesigned sedan will help drive 10 per cent growth in Hyundai’s U.S. sales next year from 734,000 vehicles expected this year. The automaker’s U.S. market share declined to 4.7 per cent in the first nine months of this year from 4.9 per cent in 2012.
“This is a chance to raise Hyundai’s image in the premium car market,” said Ahn.
The South Korean automaker, 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 U.S. and European Union 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 per cent.
Japan’s policy, meanwhile, of weakening the yen has given Japanese automakers a competitive edge in international sales. And a series of Hyundai recalls in North America and Asia have hurt the automaker’s image. Hyundai’s U.S. car sales rose 1.6 per cent in the first nine months of this year compared with overall growth in auto sales of 8.1 per cent.
The new Genesis models will be sold at between 46.6 million won ($43,908) and 69.6 million won ($65,582) in South Korea. Prices for the U.S. 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 R&D division.
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 U.S. east coast.
Hyundai used more high-strength steel for better performance and safety. About 50 per cent of the new Genesis is made of high-strength steel compared with 14 per cent in the older model.
Other features include a trunk that can be opened wirelessly and carbon dioxide control inside the vehicle to prevent drowsiness.