Some Luxury Buyers Downshift to Hyundai Genesis

[1SICKLEX]

Originally Posted by UDel

It is why Lexus/Acura/Infiniti hold back on many more upscale cars and v10/v12 engines in the US because of this whole badge thing many in the US are so obsessed with and they know 65K+ cars are not going to sell in big numbers compared to Merc/BMW/Bently/Ferrari no matter how good because people start caring more about image and badge at those prices.
.

You cannot bunch those 3 together. Lexus offers a Flagship, it has for 20 years it is revered worldwide. Infiniti can't sell one WITh a badge and Acura can't even begin to compete in that segment or the one below it. Acura doesn't evne have a V-8. HYUNDAI does for crying out loud.

Lexus has offered more and more priceier vehicles that people do buy. People feel the badge warrents the price.

While in THEORY badges should not matter, they do, period. Otherwise everyone would drive an Acura RL or a Volvo S80. Good cars that are passed over b/c of badge.

Toyota/Nissan/Honda CLEARLY felt they needed the badge to be taken somewhat serious. All marketing points in that direction. Mazda almost did it with Amati. GM does it with caddy and Ford with Lincoln. VW with Audi.

The fact is there are much less buyers interested in buying a fine luxury car WITHOUT the badge. They are BY FAR the minority and the Genesis is for them.

The imaginary world where "badges don't matter" is just that imaginary.

You think here is bad???? Go to Europe or Japan or Asia where BRANDS are where its at. In Europe they bash cars in reviews just because of badge.

[1SICKLEX]

Originally Posted by The G Man

Poeple laugh at Lexus too when they 1st came out, they say its nothing more than a Toyota with leather seat or Lexus is a MB or BMW want to be. The Gensiss is a good start, Hyundai need to continue with the luxury brand comittment. One day people will take a Luxury Hyundai sedan seriously.

Its entirely possible Hyundai is fine not having a luxury brand. That would cost BILLIONS and take YEARS to develop and implement. The Genesis is selling fine to those where "badge" is not important.

One other difference is the LS and lexus at the time SHOCKED THE WORLD whereas the Genesis is kind of a re-run of Lexus at the time.

Its possible maybe Hyundai's marketing team decided the world is not ready for a Korean luxury brand. I have no idea.

[1SICKLEX]

Let me also add, having a "BADGE" does not equal instant success. Infinit struggled until the latest gen M35/45 and the Q45 got discontinued and failed for nearly 20 years. They just debuted a nicely done EX35 they can't give away. Acura is basically a brand for Civic owners to move up to. Volvo is an afterthought. So is Saab. Lincoln also suffers and it has the "badge".

No better example than Audi, clearly a top rate premium brand that continues to struggle in America, even with more products, more aggresive marketing etc.

Look at poor Jaguar, they could not GIVe away the X-type.

True there are different reasons for all their failures, but the fact is that a luxury BADGE does not mean whatever you decide to sell, will sell or be loved/adored by the public.

I've said it before, America= Benz/BMW/Lexus and then there is everyone else from a badge perspective. I think Hyundai figured that out and doesn't want to invest money in something that wouldn't sell much more than what the Genesis sells now.

[rdgdawg]

Originally Posted by 1SICKLEX

[...
I've said it before, America= Benz/BMW/Lexus and then there is everyone else from a badge perspective. I think Hyundai figured that out and doesn't want to invest money in something that wouldn't sell much more than what the Genesis sells now.

And from a viable business standpoint, that is a very wise decision...

[speedflex]

I have been trying to figure out where Hyundai's business strategy is headed with the Genesis cars and so far it just doesn't fit with the existing models of what others have done which is to spin off higher end cars into a premium division. If they do bring the Equus over to the states will it be a Hyundai or will it be the flagship of a new luxury arm?

One possibility is that Hyundai wants to become something that really doesn't exist in this market... an elevated brand which sells all these cars under one brand which features premium products from top to bottom, effectively making their small and midsize cars and CUVs high end mainstream products. In other words, it puts Hyundai on a higher plane than just about any other mainstream car brand since they would also have to elevate their showrooms, service and sales departments to match that level of customer experience. I'm just theorizing, of course, but it is an option and it would be something noone has done before.

[The G Man]

The genesis is a test car for Hyandai in the US luxury market, if it does well, maybe another up scale Hyundai after that, then its all go for the Hyundai luxury branch. Its the natural next step for Hyundai.

[1SICKLEX]

Originally Posted by speedflex

I have been trying to figure out where Hyundai's business strategy is headed with the Genesis cars and so far it just doesn't fit with the existing models of what others have done which is to spin off higher end cars into a premium division. If they do bring the Equus over to the states will it be a Hyundai or will it be the flagship of a new luxury arm?

One possibility is that Hyundai wants to become something that really doesn't exist in this market... an elevated brand which sells all these cars under one brand which features premium products from top to bottom, effectively making their small and midsize cars and CUVs high end mainstream products. In other words, it puts Hyundai on a higher plane than just about any other mainstream car brand since they would also have to elevate their showrooms, service and sales departments to match that level of customer experience. I'm just theorizing, of course, but it is an option and it would be something noone has done before.

Good point. Hyundai would then do what VW wanted to do but couldn't here; move upmarket successfully. VW covers from the cheap Polo (we don't get) to the Phaeton (we no longer get) and Tourag (which no one buys). The Passt W8 sadly sold poorly at its 40k asking price.

My other thought is maybe "Genesis" will eventually be the name of the brand they spin off and they will then call things "the Genesis X350" yadda yadda.....

[mmarshall]

Originally Posted by 1SICKLEX

The imaginary world where "badges don't matter" is just that imaginary.

You think here is bad???? Go to Europe or Japan or Asia where BRANDS are where its at. In Europe they bash cars in reviews just because of badge.

So, because some people overseas want to live in automotive ignorance, should we, here in America, live the same way?

As I see it, it is the job of people like you and me; people who know one car from another and one badge from another; to chip away at that world of ignorance.

[IS-SV]

Badges matter unfortunately and any auto company interested in making a profit understands this.

But a badge needs to be backed up with substance and solid product(s).

[LexBob2]

Originally Posted by IS-SV

Badges matter unfortunately and any auto company interested in making a profit understands this.

But a badge needs to be backed up with substance and solid product(s).

Yup. That extends beyond cars too, to just about everything. Companies spend fortunes to establish brand names.

[mmarshall]

Originally Posted by IS-SV

Badges matter unfortunately and any auto company interested in making a profit understands this.

But a badge needs to be backed up with substance and solid product(s).

I have to disagree that badges themselves matter....as you say, it is the vehicle behind that badge that really matters. Case in point.....Hyundai and Kia used to produce some of the worst and most poorly-built vehicles in the American market. Now, considering their low cost, they produce some of the best.

Of course, badges DO sometimes mean something when you take their entire line of vehicles as a whole. BMW, for instance, does excellent steering and chassis engineering, Mercedes and Volvo are known for safety-oriented features, Subaru does a superb inexpensive AWD, Honda has superb vehicle assembly quality and often leans with cutting-edge engine technology, etc... So certain badges are known for their unique features. But, even so, it is not the badge, but the vehicle behind it that really matters.

[IS-SV]

Originally Posted by mmarshall

I have to disagree that badges themselves matter....as you say, it is the vehicle behind that badge that really matters. Case in point.....Hyundai and Kia used to produce some of the worst and most poorly-built vehicles in the American market. Now, considering their low cost, they produce some of the best.

Of course, badges DO sometimes mean something when you take their entire line of vehicles as a whole. BMW, for instance, does excellent steering and chassis engineering, Mercedes and Volvo are known for safety-oriented features, Subaru does a superb inexpensive AWD, Honda has superb vehicle assembly quality and often leans with cutting-edge engine technology, etc... So certain badges are known for their unique features. But, even so, it is not the badge, but the vehicle behind it that really matters.

Of course badges matter.

Badges backed up with good product is what I said that matters. Therefore GM badges and Chrysler badges are tainted by a mixture of good and very bad product. BMW/Mercedes/Lexus/Porsche badges are backed up by good to very good products. It's the badge and the vehicle that matters in combination in the real market.

[JKA.nyc]

Originally Posted by 1SICKLEX

The imaginary world where "badges don't matter" is just that imaginary.

This is what I've been trying to say since forever in that other Hyundai thread way back but the Hyundai trolls refuse to accept it!!!!

In this imaginary world where badge doesn't matter, I'm sure there's peace on earth, food for everyone, no disease, pain or suffering etc etc you get the idea.

In all seriousness though if you think about it;

in a world where badge/branding didn't matter there would be no need for any differentiation between anything from clothes to food to electronics. therefore there would be no need for different brands and everything would be produced by one producer and we'd all consume the exact same things, and therefore there would be no need for people to be paid differently if we bought all the exact same things priced the same and so on and so forth and all this sounds a little like communism doesn't it?

[kalvano]

Originally Posted by mmarshall

I have to disagree that badges themselves matter....as you say, it is the vehicle behind that badge that really matters. Case in point.....Hyundai and Kia used to produce some of the worst and most poorly-built vehicles in the American market. Now, considering their low cost, they produce some of the best.

And no matter how good the car they produce is, the depreciation hit on Hyundai / Kia is massive because of the badge they wear.

[tex2670]

Originally Posted by JKA.nyc

Apples to oranges, Lexus is a separate brand.

The creation of a luxury marque is like a rite of passage into the luxury market and even then nothing is guaranteed, and until then many people including I will be unable to consider it a serious luxury contender.

The Genesis would cost even more if Hyundai had to pay all that money to set up a separate dealer network. The Genesis sedan isn't horribly more expensive than a fully loaded Avalon, and is clearly cheaper than a Sequoia and a Land Cruiser, but Toyota sells all those next to a Yaris, Corolla and their Scions.