G70-2018 or 2019?

[EdP]

I think they are either going to make a go of it with 100 dealers or flame out trying but they are not going to do it half way just for extra sales and risk a lousy customer experience and damage to the brand. Because those who have a bad dealer experience are the ones that will complain the loudest.

But they don't have to have a bad dealer experience. The dealers will have to be vetted and meet some minimal standards. They did this with the top 100 already or will shortly. I've been turned off by a couple of existing luxury brand dealers too. We're looking at maybe 50 dealers to fill in the gaps. There are four Hyundai dealers withing a sensible buying distance from me. One I won't bother going to, another I went to one time for service and will never go again, the other two I'd buy any brand of car from because they treated me well. The one, in fact, has two Hyundai locations as well as RR, Lamborghini, MB, Porsche, and 50 more. I suspect they know how to train employees to take care of customers. I just don't see turning down sales in Wyoming or North Dakota because the dealer is too far away. We'll see, probably in a year or so.

 

[Mark_888]

I just don't see turning down sales in Wyoming or North Dakota because the dealer is too far away. We'll see, probably in a year or so.

Wyoming is not a good example, with only about 700,000 population in the entire state. The Houston TX metro area has more people than the bottom 12 states combined (I previously posted the exact number, but forgot the details). Dallas-FT Worth about the same population as Houston, and then there are San Antonio and Austin metro areas. That's just for TX.

From what I can tell, there are no Acura dealers in Wyoming (I believe that Acura has about 250 dealers in the USA).

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I suspect they know how to train employees to take care of customers.

Training is part of it, but they also need higher quality employees, and they have to pay more in wages to get that. That means higher sales prices (less discount from MSRP) to allow them to pay more. Less discounting is a lot easier when there is little or no competition from other dealers.

Keep in mind that the new Genesis dealers will (eventually) be completely separate from the Hyundai dealerships, so I would not say the selection of the 100 is completely based on current service quality at their Hyundai dealerships (although it may play a factor).

 

[PMCErnie]

No, all luxury brands do not have separate dealerships. Nor, are separate dealerships necessarily critical for success.

 

[Mark_888]

No, all luxury brands do not have separate dealerships. Nor, are separate dealerships necessarily critical for success.

OK, which luxury brands don't have separate dealerships? Maybe some Ford/Lincoln dealers (if you want to call Lincoln a luxury brand), but I have never seen a Lexus, Acura, Infiniti etc dealership that was combined with Toyota, Honda, or Nissan.

 

[GV70GUY]

Interesting Lexus, Acura, Infiniti history as to Genesis now:

1989 Lexus launched with two sedans, the LS 400 and ES 250, and a commitment to pursue perfection.

1990 Out of thousands of parties interested in a Lexus franchise, only 121 top-notch dealers are selected for Lexus’ first year of business.

Then over the years they started introducing new vehicles.....

1999 One-millionth vehicle sold in the U.S.
2004 Two-millionth vehicle sold in the U.S.

Today Lexus has about 250 dealerships.

INFINITI in 1989 launches with 51 dealers in the United States. There were only 2 available models. Today they have about 400 dealerships.

Honda in 1986 open 60 new dealerships in North America to support its Acura automobile division.


So it looks as though Genesis is following these same history lines, if they do open with 100 Genesis dealers then that actually could be a good start.

 

[devellis]

I will bet that none of the Toyota cars actually had the protection done yet. They figured if the customer goes for it they'll just do it at prep time. If the customer is smart enough and refuses it then they will just reduce the price and maybe make you think you got something for free.

When I bought my wife's Honda Fit they had this decal on the side that said VTECH and an added cost to the sticker price of like $200. I'm thinking they adding something to the motor. When I asked and they told me it was just the sticker I started to laugh and told them there was no way I was paying that. I got the car and they left the sticker on. Always a sucker.....

Like doc fees when I was looking at one Hyundai dealership for my Genesis they wanted $500 for doc fees. I left......

Actually, we were told that all of the cars had the protection done immediately on arrival, before hitting the showroom, so that the dealership could avoid delays when cars were picked up. Part of the package was window tinting on certain models and they all definitely had that. You could order a car not in stock and request that it never get the package, however. Was what we were told true? Well, it really doesn't matter in terms of how I perceived the dealership and how un-eager I'd be to do business with them. This is all the sort of thing that Genesis needs to avoid.

 

[Mark_888]

So it looks as though Genesis is following these same history lines, if they do open with 100 Genesis dealers then that actually could be a good start.

Maybe so, but the unusual thing here is that the Genesis G80 has been sold at over 800 Hyundai dealerships, and the G90 at probably half that number. So going down to 100 dealers is going to be a shock to some people.

The other thing that is different, is that SUV's now account for more than 50% of Lexus, Acura, and Infiniti unit sales (Acura way more than 50%), and Genesis Motors doesn't even have one single SUV for sale yet (and looks like it may be at least a year away before they have one). Bentley's new SUV is now their best selling model.

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Actually, we were told that all of the cars had the protection done immediately on arrival, before hitting the showroom, so that the dealership could avoid delays when cars were picked up. Part of the package was window tinting on certain models and they all definitely had that. You could order a car not in stock and request that it never get the package, however. Was what we were told true? Well, it really doesn't matter in terms of how I perceived the dealership and how un-eager I'd be to do business with them. This is all the sort of thing that Genesis needs to avoid.

I bought a 1992 Toyota Camry and the window sticker had the same protection crap package added by the distributor (Gulf States Toyota) for about $500 (not sure what the number was). I told the dealer I was not going to pay it. When I got home, I opened the glove compartment, and there was a clear plastic bottle of some generic protectant or sealant that was supposed to be applied to the car, so I don't think they actually applied anything. I threw the bottle away.

Gulf States Toyota and Southeast Toyota, are two of the regional distributors for Toyota Motor USA. They were created a long time ago as independent franchise companies, and Toyota is not able to buy them back or to revoke their contract. I think Toyota USA owns all the other regional distributors in the USA.

 

[EdP]

The other thing that is different, is that SUV's now account for more than 50% of Lexus, Acura, and Infiniti unit sales (Acura way more than 50%), and Genesis Motors doesn't even have one single SUV for sale yet (and looks like it may be at least a year away before they have one). Bentley's new SUV is now their best selling model.

The addition of the G70 should attract more buyers, but the lack of an SUV is going to make it tough for a stand alone dealer to make a profit. The next two years will be tough on dealers though it may take them that long to bet up and running anyway.

 

[devellis]

I bought a 1992 Toyota Camry and the window sticker had the same protection crap package added by the distributor (Gulf States Toyota) for about $500 (not sure what the number was). I told the dealer I was not going to pay it. When I got home, I opened the glove compartment, and there was a clear plastic bottle of some generic protectant or sealant that was supposed to be applied to the car, so I don't think they actually applied anything. I threw the bottle away.

Gulf States Toyota and Southeast Toyota, are two of the regional distributors for Toyota Motor USA. They were created a long time ago as independent franchise companies, and Toyota is not able to buy them back or to revoke their contract. I think Toyota USA owns all the other regional distributors in the USA.

Yeah, I've definitely encountered that in the past. I remember buying a Honda Civic decades ago and insisting on not paying the pumped-up prep price. This was back in the era of undercoating. Some years later, I bought an Acura Legend (which was their top model at the time) and got all of the treatments for free, plus a full set of the stuff for my own use as I chose. That was fine. I wasn't being charged an extra fee for any of it. It was considered part of the normal prep for the car. Of course, in some sense I had to be paying for it but it wasn't tacked onto the sticker price. Since then, I don't ever remember ever buying a high-end car (or even a Subaru) with any mention of there being an extra charge for delivering the car waxed and prepped as one would expect.

Again, it's obvious that dealers are recouping the costs associated with any prep prior to delivery. But that's built into the pricing structure for the car. The manufacturers assume that cars will be adequately prepped prior to delivery, not just rolled off of the truck and handed off to the customer. It was the perception that the $2000 add-on created that really turned me off. I wasn't looking for a car but just doing some advance reconnaissance with my brother who was looking for his son. But even then, I was ready to suggest to my brother (who sold Lexus and then Mercedes for years) that we just leave.

If a dealership selling a car like Genesis ends up creating that sort of impression (and I have no reason to think that it will), that would be pretty disastrous for the brand, I think. So, they need to assure that the dealers are not pulling that sort of shenanigans. I expect the people I buy a car from to make a profit. But I want there to be transparency in the pricing and negotiating. Whether it's creating entirely new dealerships exclusively or setting aside portions of existing Hyundai dealerships with dedicated staff selling Genesis, the company needs to make sure that the buying experience is commensurate with the premium image that want to cultivate. It seems like they are aware of that issue and are pursuing that goal. We'll see, eventually, how successful their efforts have been.

 

[Mark_888]

Yeah, I've definitely encountered that in the past. I remember buying a Honda Civic decades ago and insisting on not paying the pumped-up prep price. This was back in the era of undercoating. Some years later, I bought an Acura Legend (which was their top model at the time) and got all of the treatments for free, plus a full set of the stuff for my own use as I chose. That was fine. I wasn't being charged an extra fee for any of it. It was considered part of the normal prep for the car. Of course, in some sense I had to be paying for it but it wasn't tacked onto the sticker price. Since then, I don't ever remember ever buying a high-end car (or even a Subaru) with any mention of there being an extra charge for delivering the car waxed and prepped as one would expect.

Again, it's obvious that dealers are recouping the costs associated with any prep prior to delivery. But that's built into the pricing structure for the car. The manufacturers assume that cars will be adequately prepped prior to delivery, not just rolled off of the truck and handed off to the customer. It was the perception that the $2000 add-on created that really turned me off. I wasn't looking for a car but just doing some advance reconnaissance with my brother who was looking for his son. But even then, I was ready to suggest to my brother (who sold Lexus and then Mercedes for years) that we just leave.

If a dealership selling a car like Genesis ends up creating that sort of impression (and I have no reason to think that it will), that would be pretty disastrous for the brand, I think. So, they need to assure that the dealers are not pulling that sort of shenanigans. I expect the people I buy a car from to make a profit. But I want there to be transparency in the pricing and negotiating. Whether it's creating entirely new dealerships exclusively or setting aside portions of existing Hyundai dealerships with dedicated staff selling Genesis, the company needs to make sure that the buying experience is commensurate with the premium image that want to cultivate. It seems like they are aware of that issue and are pursuing that goal. We'll see, eventually, how successful their efforts have been.

Keep in mind that with Toyota, especially since Toyota USA started out with all their cars being imported from Japan, has regional importers that buy the cars from Toyota Japan, and sell them to dealers in their area. As I mentioned, Toyota does not own Gulf States Toyota or Southwest Toyota, due to some historical oddities that happened a long time ago.

On the contrary, Genesis Motors USA (importer and distributor of Genesis vehicles) is 100% owned by Hyundai Motor America, which is 100% owned by Hyundai Motors in Korea. So you are not likely to see really weird stuff on the sticker like you might on some Toyota cars. But I don't believe that just because a distributor adds those protection packages to a sticker, that it means that the dealer actually paid the distributor anything for it, as it is mostly just a way to fool some of the customers into paying more for the car.

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Irate Customer: [sitting with wife and talking to Jerry Lundegarrd]
We sat right here in this room and went over this [during previous visit to dealer].

Jerry Lundegaard: Yah, but that TruCoat...

Irate Customer: I said I didn't want any TruCoat!

Jerry Lundegaard: Yah, but I'm saying, that TruCoat, you don't get it, you get oxidation problems...

Irate Customer: You're sitting there talking in circles like we didn't go over this already!

Jerry Lundegaard: Yeah, but this TruCoat...

Irate Customer: We had a deal for $. Darned if you didn't tell me you'd get me this car without the sealant for $.

Jerry Lundegaard: All right, I'm not saying I didn't.

Irate Customer: You called me and said you had "it."
"Ready to make delivery" you says.
And here you are and you're wasting my time and my wife's time.
And I'm [only] paying $ for this vehicle here!

Jerry Lundegaard: All right. I'll talk to my boss.
[Jerry stands up, about to leave the room]
See, they install that TruCoat at the factory. There's nothing we can do.
But I'll talk to my boss.

Irate Customer: [talking to his wife]
These guys here. These guys. It's always the same. It's always more.

[Jerry Lundegaard leaves the room and goes into a another office, pretending to talk to his manager]

Jerry Lundegaard: [talking to another salesman who is watching a football game on TV]
You going to the Gophers game on Sunday?

Other Salesman: Oh, you betcha.

Jerry Lundegaard: You wouldn't have an extra ticket?

Other Salesman: You kiddin'?

Jerry Lundegaard: [Jerry returns to room with customer and his wife, with big smile on his face]:
Well. He's never done this before [referring to nonexistent manager], but seein' as it's special circumstances an' all...
He says I can knock $100 off that TruCoat.

Irate Customer: One hundred?
You lied to me, Mr Lundegaard.
You're a bald-faced liar.

Irate Customer’s wife: Bucky, please!

Irate Customer: A... f__king liar.

Irate Customer’s wife: Bucky, please!

Irate Customer: Where's my goddamn checkbook?
Let's get this over with, Where is it?

Dialog from the movie "Fargo" 1996. Nominated for 7 Academy Awards (winner for Best Actress and Best Original Screenplay).

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[PMCErnie]

OK, which luxury brands don't have separate dealerships? Maybe some Ford/Lincoln dealers (if you want to call Lincoln a luxury brand), but I have never seen a Lexus, Acura, Infiniti etc dealership that was combined with Toyota, Honda, or Nissan.

Correct. There are plenty of combo Ford/Lincoln dealers around. Also, plenty of other combo dealerships like this Cadillac/Chevrolet dealer. https://www.crossroadsjoplin.com

Yes, both Cadillac and Lincoln are considered luxury vehicles.

Such combinations also show that joint Hyundai/Genesis dealerships under one roof can continue to work for many years.

 

[dougjp]

Correct. There are plenty of combo Ford/Lincoln dealers around. Also, plenty of other combo dealerships like this Cadillac/Chevrolet dealer. https://www.crossroadsjoplin.com

Yes, both Cadillac and Lincoln are considered luxury vehicles.

Such combinations also show that joint Hyundai/Genesis dealerships under one roof can continue to work for many years.

Agreed, and should have been the case in Canada.

 

[Mark_888]

Correct. There are plenty of combo Ford/Lincoln dealers around. Also, plenty of other combo dealerships like this Cadillac/Chevrolet dealer. https://www.crossroadsjoplin.com

Yes, both Cadillac and Lincoln are considered luxury vehicles.

Such combinations also show that joint Hyundai/Genesis dealerships under one roof can continue to work for many years.

Most of those combined dealerships are in small towns. Plus, I don't think that Genesis Motors for one second is thinking that Cadillac or Lincoln is their competition. I wonder how many in this forum considered those brands before buying a Genesis?

 

[PMCErnie]

Most of those combined dealerships are in small towns. Plus, I don't think that Genesis Motors for one second is thinking that Cadillac or Lincoln is their competition. I wonder how many in this forum considered those brands before buying a Genesis?

Sure, go ahead a create your own reality, if it works for you. We all read the recent reviews comparing the G90 with the Lincoln Continental. Not to mention that the new Lincoln Navigator is selling very well in the Escalade, Rover, etc. luxury market. Yes, Lincoln is a luxury market competitor, as remains Cadillac. My local combo Lincoln/Ford dealer work well-enough and Richmond, VA is hardly a plow town.

By the way, there remains a lot of BUY AMERICAN sentiment out there. Not everybody wants a vehicle from across the waves. I've driven the Conti and liked it, except for the dim instrument cluster.

My major point, though, is that there is no need for standalone Genesis dealerships when good quality service can be delivered at combo Hyundai/Genesis dealerships. Shame on them if they don't realize that fact.

 

[vinuneuro]

Correct. There are plenty of combo Ford/Lincoln dealers around. Also, plenty of other combo dealerships like this Cadillac/Chevrolet dealer. https://www.crossroadsjoplin.com

Yes, both Cadillac and Lincoln are considered luxury vehicles.

Such combinations also show that joint Hyundai/Genesis dealerships under one roof can continue to work for many years.

Having the mainstream and luxury brands under one dealer roof has been acknowledged as from a sales pov and the long-term plan at least at GM is to pull Cadillac into stand-alone stores.

 

[GV70GUY]

There was a long argument that Corvette should be sold thru a separate of high end dealership like maybe thru caddy. Here you are buying a $100,000 car that's sitting next to a $20k car sold by the same salesperson. You are in most cases treated the same even when you bring it in for service.

 

[vinuneuro]

Having the mainstream and luxury brands under one dealer roof has been acknowledged as from a sales pov and the long-term plan at least at GM is to pull Cadillac into stand-alone stores.

I think what I meant was probably clear even with the typo, but let me fix it so there is no misunderstanding:

"Having the mainstream and luxury brands under one dealer roof has been acknowledged as flawed from a sales pov and the long-term plan at least at GM is to pull Cadillac into stand-alone stores."

 

[EdP]

There was a long argument that Corvette should be sold thru a separate of high end dealership like maybe thru caddy. Here you are buying a $100,000 car that's sitting next to a $20k car sold by the same salesperson. You are in most cases treated the same even when you bring it in for service.

I'm not so sure that is always the case. I know of a couple of small dealers that sell a lot of Corvettes and have a good reputation for servicing them. One has since gone out of business after the long time owner retired and is now a used car business with the same mechanics and many Corvette owners go there for service. Of course, Corvette owners are a small segment of the car buyers and more likely to hear of the better dealers and seek them out.

 

[Mark_888]

Sure, go ahead a create your own reality, if it works for you. We all read the recent reviews comparing the G90 with the Lincoln Continental. Not to mention that the new Lincoln Navigator is selling very well in the Escalade, Rover, etc. luxury market. Yes, Lincoln is a luxury market competitor, as remains Cadillac. My local combo Lincoln/Ford dealer work well-enough and Richmond, VA is hardly a plow town.

By the way, there remains a lot of BUY AMERICAN sentiment out there. Not everybody wants a vehicle from across the waves. I've driven the Conti and liked it, except for the dim instrument cluster.

My major point, though, is that there is no need for standalone Genesis dealerships when good quality service can be delivered at combo Hyundai/Genesis dealerships. Shame on them if they don't realize that fact.

I actually agree with you that having a Hyundai dealer selling Genesis Motors cars is not a problem for me personally. I spend as little time at a dealer as possible, and don't care about superficial perks such as fancy waiting rooms, because the customer is going to pay for it with higher prices in the end.

As far as buying American, that depends a lot where you live and how old you are. American cars have a much smaller market share in big cities with young professionals, compared to smaller more traditional cities.

However, I just don't think that Genesis Motors USA has done a good job with the rollout of their brand, and specifically the fact that 2 years after the launch that some state DMV's don't even know it is a separate brands.

 

[EdP]

As far as buying American, that depends a lot where you live and how old you are. American cars have a much smaller market share in big cities with young professionals, compared to smaller more traditional cities.

Is it even possible to buy American? The sticker does give you the percentage of US made parts and I bet it has trended down over the years. Is it better to buy a US brand made mostly in a foreign country or a foreign brand made in the USA? I bought a lot of GM cars for years until they screwed my. Now I buy products based on what is best for me. Recently, that is Korean made.