The ? Is..

[WowCool]

Are the designers and engineers @ Hyundai better because they can produce a vehicle like the "G" at a lower
cost than say an equivalent Lexus or
Euro car maker? Or are Hyundai's
pricing policies a marketing strategy?
The other ? Is:- what are Hyundai doing to keep their Dealership standards high
enough to encourage "G" owners to stay in the "H" fold..👀

 

[shagnat]

Are the designers and engineers @ Hyundai better because they can produce a vehicle like the "G" at a lower
cost than say an equivalent Lexus or
Euro car maker? Or are Hyundai's
pricing policies a marketing strategy?
The other ? Is:- what are Hyundai doing to keep their Dealership standards high
enough to encourage "G" owners to stay in the "H" fold..👀

I'm not yet convinced Hyundai is a top quality product. The Genny has been only only 4 years through 2013. Lexus is probably the top car in regards to quality. Just because Hyundai can put bells and whistles on a car doesn't make it competitive with the established luxury car brands.

Hyundai isn't doing much right in the way of customer service IMO (only) to warrant customers to return to purchase another Genny. I've had mine in the shop 3 times for the same problem and it is still not fixed! They did find out what's wrong after the 3rd trip, but, of course had to order the part. My story about many return trips to fix the same issue is only of many.

Peeps, these are just my opinions....... so take them as such.

 

[PMCErnie]

Folks should compare the Hyundai 5/60 warranty with these.

https://secure.drivers.lexus.com/lexusdrivers/info/my-lexus/service/warranty.do

https://secure.drivers.lexus.com/lexusdrivers/info/my-lexus/service/warranty.do

More than one trip to the dealer needed to fix a problem? That's certainly not unique to Hyundai. I bought a BMW when I lived in Germany. No difference there. Brought it home and was greeted with the same service problems here.

I test drove a Lexus ES before I bought the Genesis. That car drove like an old Buick. Pretty cabin, though.

I foresee Hyundai remaining a low-cost luxury builder, but they are not invincible.

 

[stevebxl]

I'm not yet convinced Hyundai is a top quality product. The Genny has been only only 4 years through 2013. Lexus is probably the top car in regards to quality. Just because Hyundai can put bells and whistles on a car doesn't make it competitive with the established luxury car brands.

Hyundai isn't doing much right in the way of customer service IMO (only) to warrant customers to return to purchase another Genny. I've had mine in the shop 3 times for the same problem and it is still not fixed! They did find out what's wrong after the 3rd trip, but, of course had to order the part. My story about many return trips to fix the same issue is only of many.

Peeps, these are just my opinions....... so take them as such.

I would be inclined to disagree with you I very carefully researched & compared several sedans (BMW, Lexus, Toyota, Mercedes, and Lincoln - keeping the cost below $60K to be fair) before I decided on a Genesis. Reviews of current owners of each make/model, initial cost of the vehicle, options included, and the cost of maintenance of each vehicle were considered.

Winning results seemed to always point to the Genesis. I liked the looks of the Genny too. I test drove them all and for me the Genny won. I wasn't looking for a sports car ride, but something that rode well on the interstate for road trips.

As far as customer service goes - we have an outstanding dealer in our area ( I have 5 people who have bought another car through them including us in 2006) and we have always been treated great. No matter what brand of car you buy, there's always the risk of crappy customer service though IMO.

Just my 2¢ ...

 

[imaphaetonguy]

If I am not mistaken, one of the benefits of building the Genny in S. Korea is a labor rate about 1/3 of its US equivalent. That savings get passed directly onto us buyers.

 

[Mark_888]

If I am not mistaken, one of the benefits of building the Genny in S. Korea is a labor rate about 1/3 of its US equivalent. That savings get passed directly onto us buyers.

If that were true, they wouldn't build most other Hyundai's in the US, like Sonata, Elantra, Santa Fe, etc. About 75% of Hyundai vehicles sold in the US are built in the US.

If one looks at the price of a Genesis in Korea, or even Canada, it is obvious they are selling it at a discount in the US. Hyundai Motor America has stated that one of the main reasons for this (and why it is sold as Hyundai in the US, but sold as Genesis brand in Korea, Middle East, and Russia) is that they are using the Genesis to "build the brand image" of Hyundai.

When the first Hyundai Genesis was released in the US in 2009, there were stories that some enterprising people were buying them in the US and reimporting them back to Korea, and making a nice profit (even after paying additional import duties, transportation, etc). Reports were that the 2009 Genesis sold in the US was $17K cheaper than the equivalent car in Korea (although options are not exactly the same, so exact comparison is difficult).

 

[YEH]

Are the designers and engineers @ Hyundai better because they can produce a vehicle like the "G" at a lower
cost than say an equivalent Lexus or
Euro car maker? Or are Hyundai's
pricing policies a marketing strategy?

Hyundai is able to offer lower prices than Lexus and Infiniti by eschewing the cost of a separate luxury brand and dealer network which would tack on $6-10k onto the price of a model (depending on segment and sales volume).

Pricing will also depends on the amenities that Hyundai provides for certain models.

Note that the price gap btwn the Genesis and the GS sedans is comparatively greater than that btwn the Equus and LS; that's b/c Hyundai prices in the cost of higher end service such as loaners and valet service for the Equus while those aren't yet offered for the Genesis (the latter probably will never be offered for the Genesis).

Along the same lines, the Kia Cadenza is priced higher than the Azera b/c it has a more luxurious interior, more tech gadgets and 3 yr maintenance.

The 2G Genesis will go up a bit in price - some of that will be to the more luxurious interior and added tech items, but likely a part will also be due to amenities like loaners.

I'm not yet convinced Hyundai is a top quality product. The Genny has been only only 4 years through 2013. Lexus is probably the top car in regards to quality. Just because Hyundai can put bells and whistles on a car doesn't make it competitive with the established luxury car brands.

Quality and reliability are 2 different things.

All Lexus models are just rebranded Toyotas.

If I am not mistaken, one of the benefits of building the Genny in S. Korea is a labor rate about 1/3 of its US equivalent. That savings get passed directly onto us buyers.

That may have been the case 15 years ago during the Asian fiscal crisis when the value of the won plummeted.

Nowadays, Korea is seen as a high wage country (as wages have gone up and the won has appreciated against the dollar) - which is why GM is taking steps to move some of its production from Korea to countries like Spain.

 

[Mark_888]

All Lexus models are just rebranded Toyotas.

That is like saying that a Bentley is a rebranded VW. What are the equivalent Toyota models for the Lexus LS and GS? More rubbish.

 

[Gdog]

That is like saying that a Bentley is a rebranded VW. What are the equivalent Toyota models for the Lexus LS and GS? More rubbish.

Well....the ES is nothing more than a gussied up Camry or Avalon....
G

 

[Mark_888]

Well....the ES is nothing more than a gussied up Camry or Avalon....
G

That is mostly true, but so what? The ES is still a very good car (as are Camry and Avalon in their classes).

But YEH said that all Lexus vehicles are rebranded Toyotas. Please show me the Toyota branded GS and LS.

Guess what? The Genesis is nothing more than a gussied up Hyundai. In fact, it is a Hyundai. But all of these kinds of claims are only slightly above the level of little children calling each other names.

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[GenesisCaptain]

The Lexus LS was the Toyota Celsior, and the Lexus GS was the Toyota Aristo until around 2006. Then Toyota re-branded them as Lexus.

 

[YEH]

That is like saying that a Bentley is a rebranded VW. What are the equivalent Toyota models for the Lexus LS and GS? More rubbish.

Rubbish?

Bentley is actually a separate company whereas Lexus is not a separate company from Toyota and until just recently, Toyota used the same designers for both brands.

Like Acura is for Honda and Infiniti for Nissan, these luxury nameplates are essentially a separate sales distribution channel (which they have readily admitted to).

That is mostly true, but so what? The ES is still a very good car (as are Camry and Avalon in their classes).

Eh, the Camry, not so much,

But YEH said that all Lexus vehicles are rebranded Toyotas. Please show me the Toyota branded GS and LS.

See below.

You really need to get out under the whole marketing spiel that automakers and others pull on consumers.

You really think there is any difference from the Scion branded FR-S and the Toyota 86 which is sold everywhere else outside of NA (same goes for all the Scion models which are sold as Toyotas).

Guess what? The Genesis is nothing more than a gussied up Hyundai. In fact, it is a Hyundai. But all of these kinds of claims are only slightly above the level of little children calling each other names.

Not claims - actual FACT (something you regularly seem to have a problem with and proffer little of it yourself).

The Lexus LS was the Toyota Celsior, and the Lexus GS was the Toyota Aristo until around 2006. Then Toyota re-branded them as Lexus.

Not only that, the JDM Toyota Aristo actually had a higher end trim than the USDM Lexus GS, at the time offering AWD and a more powerful engine (turbo V6).

And even after Toyota launched the Lexus nameplate in Japan and renamed the Celsior, Aristo and the other models (such as the Toyota Altezza aka IS and the Harrier aka the RX and still sold in Japan as the Harrier), Toyota has a separate luxury lineup with the Crown Series with the Crown Majesta being seen by Toyota as being a competitor to the S Class, 7 Series, as well as its very own LS.

And the LS is not even the flagship sedan of the Toyota fleet - that being the Toyota Century - which what the Japanese royal family rides in and is akin to the now departed Maybach and Bentley.

Well....the ES is nothing more than a gussied up Camry or Avalon....
G

And let's not forget the Lexus SUVs which are essentially a gussied up Landcruiser and Prado (Cadillac, Lincoln and Infiniti do this as well as it is not cost effective to develop a totally separate luxury SUV), as well as the departed HS the upcoming RAV-4 based CUV.

 

[WowCool]

To expand, if the similar Lexus, Chrysler, Nissan etc.. models to the Genesis where All debadged including the "G" and with no prices shown, which vehicle in the showroom would you choose?

 

[kf4zra]

If that were true, they wouldn't build most other Hyundai's in the US, like Sonata, Elantra, Santa Fe, etc. About 75% of Hyundai vehicles sold in the US are built in the US.

the reason for this is that is there is a limit on the number of cars allowed to be imported (for some reason the number 100,000 strikes me) before crippling tariffs (like 100%) are imposed on the importer.

this started somewhere in the late 70's/80's when the japanese cars started coming over in full force.

most cars that are imported these days like our genesis are cars where they dont make as many. the supra, mr2 and others were japan manufacture only. I know that a small percentage of camry was imported, and those were far more desirable to those on the toyota forums than the domestic version for reasons unknown.

in addition, building the high production number cars here saves on transportation costs and makes for good public relations. foreign car companies have chosen states like alabama, mississippi, kentucky, south carolina, and indiana as opposed to michigan, california, and new york to build as the labor rates are cheaper and tax laws more favorable.

 

[Mark_888]

the reason for this is that is there is a limit on the number of cars allowed to be imported (for some reason the number 100,000 strikes me) before crippling tariffs (like 100%) are imposed on the importer.

this started somewhere in the late 70's/80's when the japanese cars started coming over in full force.

most cars that are imported these days like our genesis are cars where they dont make as many. the supra, mr2 and others were japan manufacture only. I know that a small percentage of camry was imported, and those were far more desirable to those on the toyota forums than the domestic version for reasons unknown.

in addition, building the high production number cars here saves on transportation costs and makes for good public relations. foreign car companies have chosen states like alabama, mississippi, kentucky, south carolina, and indiana as opposed to michigan, california, and new york to build as the labor rates are cheaper and tax laws more favorable.

Are there still import quotas for cars coming into the US? I would like to see some documentation on that. I don't think the quotas are the reason any more.

Foreign manufacturers get killed with changes in currency exchange valuations, and when the US dollar goes down in value they either have to raise prices and take a beating in lower sales volume, or they have to lose money on sales. Transportation costs is one factor, but a much smaller one.

Some countries, especially the Chinese, regulate the foreign exchange conversation rate to devalue their own currency to make their exports cheaper for contrives like the US. The Japanese have tried to do intervene in currency markets to make their products cheaper to US consumers, but that doesn't always work, and automakers (and others) finally starting building stuff in the US. Labor costs are less and less of a factor in manufacturing every year as automation becomes more prevalent. Also, by locating factories in states where unions are optional, labor costs are no longer cheaper in most overseas countries than they are in the US.

 

[geneswede]

To me I doubt it's a question about costs in the end.

My thinking is that Hyundai is currently willing to take a much lower profit margin on a luxury car to establish the brand. I suspect their profit (in the end) is more aligned with the Sonata then what Toyota takes home on the G series.

They also probably tried to over engineer the car as much as they could in the beginning. To make sure people where impressed. To what degree they succeeded I can't really tell. Then each year they have tried to both improve the car while also reducing costs. For example: The 2011 V8 model uses an expensive german gearbox (used by Mercedes as well). In the 2012 they switch to their own gearbox that should be a lot cheaper for them in the long term. In the process they made it 8 speed as a selling point (which works wonders for a v6 but perhaps not as much on the v8...).

If my theory is correct then they will continue this trend and with each new model bump (major as in 2015 or minor as in 2012) they will also raise the price.

I think this will work great for them. I also think they read the market well. I think a large luxury (sporty) cruiser is 1) easier to build as performance is less important and 2) That segment is/was under served. I agree with this as when I looked at cars I wanted I balked at the price. They then expanded with the Equus which goes after the upper end and was simple as it was based on the Genesis but simply more fully loaded.

The hardest segment to "win" is the mid sized performance car. Prices are much more squeezed and to beat a 3 (or 5) series on performance requires a lot more work then building a car the size of a 7 series with a lot of luxury features. In this segment you need to be able to truly race to be competitive. This is not easy (and is one of the Gs weaker points).

It will be interesting to see what they do in the "3" series segment. Not sure how to target it. But perhaps they will do a +1 in size of all BMW cars Equus = "8" series, genesis = "6" series and unannounced car = "4" series.

I also think they will launch a separate brand once they have three models in house. Either at that time or when they launch a Luxury SUV.

 

[kf4zra]

Are there still import quotas for cars coming into the US? I would like to see some documentation on that. I don't think the quotas are the reason any more.

Foreign manufacturers get killed with changes in currency exchange valuations, and when the US dollar goes down in value they either have to raise prices and take a beating in lower sales volume, or they have to lose money on sales. Transportation costs is one factor, but a much smaller one.

Some countries, especially the Chinese, regulate the foreign exchange conversation rate to devalue their own currency to make their exports cheaper for contrives like the US. The Japanese have tried to do intervene in currency markets to make their products cheaper to US consumers, but that doesn't always work, and automakers (and others) finally starting building stuff in the US. Labor costs are less and less of a factor in manufacturing every year as automation becomes more prevalent. Also, by locating factories in states where unions are optional, labor costs are no longer cheaper in most overseas countries than they are in the US.

From what i have found, the import tariffs started in 1981. Honda opened their first plant in the USA in 1982, Nissan in 1983, and mazda in 84. Coincidence?

it wasnt the main reason, but it played a part.

with transportation costs rising, it is cheaper to build a low cost high demand American Hyundai here than to ship it halfway around the world. add to that the incentives taxwise that the local governments provide and its a no brainer. They chose states that are for the most part non-union to also save on expenses.

http://www.heritage.org/research/reports/1985/02/the-costly-truth-about-auto-import-quotas

 

[YEH]

the reason for this is that is there is a limit on the number of cars allowed to be imported (for some reason the number 100,000 strikes me) before crippling tariffs (like 100%) are imposed on the importer.

No quotas on imported autos remain that I'm aware of.

Just a 2.5% tariff on cars and a 25% tariff on trucks.

 

[Mark_888]

From what i have found, the import tariffs started in 1981. Honda opened their first plant in the USA in 1982, Nissan in 1983, and mazda in 84. Coincidence?

it wasnt the main reason, but it played a part.

with transportation costs rising, it is cheaper to build a low cost high demand American Hyundai here than to ship it halfway around the world. add to that the incentives taxwise that the local governments provide and its a no brainer. They chose states that are for the most part non-union to also save on expenses.

http://www.heritage.org/research/reports/1985/02/the-costly-truth-about-auto-import-quotas

Back in the 1980's when quotas were in effect, you are absolutely correct that is the main reason why Japanese started building plants in the US. But that is no longer the case, and certainly had nothing to do with Hyundai's decision to build cars in the US.

Transportation cost is a small factor, but not significant considering that jobs are shipped overseas to the US. The big factor these days is the currency exchange system, where the US dollar exchange rate can change rapidly creating too much risk in terms of sales/profits.

Same is true for BMW and MB who build vehicles in the US now. If the US dollar drops 30% against the Euro (as it has) they can't just raise prices by 30% and expect people in the US to buy the vehicles.

 

[JasTheAce]

I think shortening the supply cycle is a huge motivating factor. For people who just got their new 2014 Equus in, when was it manufactured? Think about that lead time, and a factory producing at 100% capacity and then having thousands of cars that don't do well when they come to market.

Or, look at the Equus, where Hyundai cannot get them to dealerships fast enough. Having more factories in the US allows auto makers to react more quickly to the US market, which could be the difference from selling 200,000 models in a year and 100,000.