Are you telling me that Hyundai CAN'T make this work?

[Sal Collaziano]

I could be wrong, but I believe that most vehicles made by BMW, Lexus, Mercedes (etcetera) are way over-priced. They're making so much money on some of their vehicles that it's just ridiculous. Their pricing is absolutely arrogant... And that's where Hyundai comes in with the Genesis and Equus models. Hyundai offers SO much for SO much less. I mean a LOT less..

But isn't there a place for a company to offer SO much for "quite a bit less"? What I'm saying is - does a car like the Equus REALLY need to be priced like a bargain basement top-tier luxury automobile? I'm sure Hyundai can sell a nicely equipped Equus for $60k and make a nice profit. And BOY would that be a GREAT, GREAT deal for the consumer!

Am I to be led to believe that Hyundai would be making a dire mistake to start a new luxury brand and charge an additional $5k for the Equus to guarantee better service, an upscale dealership experience and a snobby badge? Or should they just sell it as a Hyundai for YOUR best interests so YOU can afford one?

$65k for a nicely equipped Equus is STILL an amazing deal. While comparable vehicles from other companies are costing $80k, you're still getting a far better price from Hyundai's luxury division - so what you are to complain about?

Sure, it would be nice for Hyundai to keep pumping out amazing cars that equal or even surpass their top-tier competitors - and sell them for nothing. But how long do you think that's going to last? Eventually, they're going to HAVE to charge more for these vehicles - so at some point or another, if you want to enjoy the luxuries that people with more money enjoy, you're going to have to pay the price - whether it's badged as a "Hyundai" or a "Look what I've got"...

 

[lazyluan]

Although they are so expensive ，there are still many people buy it.I like the BMW but I don't know when I can afford it .
The company just add the some unnecessary vehicle to earn more money.

 

[LLT]

Pay less, get less.... that's a fact. You either pay or they cut corners, in one regard or another. In this case, it's service. Do you think for one second that Hyundai would have done $3-5,000 worth of work to your Equus when you were quite clearly out of warranty, as a "good will" gesture? Based on my experience, you'd be lucky to get $3-5k worth WITHIN warranty.

People who spend $60,000 on a vehicle will naturally have higher expectations. You can easily say it's a great value (just like a Stanley tool is a good value compared to Snap-on, or Fossil to Rolex), but if push comes to shove and you experience issues - the furthest thing from your mind will be that great value... at the forefront will be the fact that you spent $60k on a vehicle which the manufacturer is jerking you around with. Further, it's a huge gamble buying a $60,000+ Hyundai in its infancy. Next to Chrysler, Kia and Suzuki - Hyundai has some of the worst resale values around. If the market determines the $60k Equus is worth $30k when you drive it off the lot, you have a big problem and your $15k initial savings over a brand that will hold its value begins making less and less sense.

If you sell a $60k car, you'd better DELIVER a $60k car, with service. I'm fairly convinced Hyundai cannot do that YET.

JMHO.

 

[ctrcbob]

I could be wrong, but I believe that most vehicles made by BMW, Lexus, Mercedes (etcetera) are way over-priced. They're making so much money on some of their vehicles that it's just ridiculous. Their pricing is absolutely arrogant... And that's where Hyundai comes in with the Genesis and Equus models. Hyundai offers SO much for SO much less. I mean a LOT less..

But isn't there a place for a company to offer SO much for "quite a bit less"? What I'm saying is - does a car like the Equus REALLY need to be priced like a bargain basement top-tier luxury automobile? I'm sure Hyundai can sell a nicely equipped Equus for $60k and make a nice profit. And BOY would that be a GREAT, GREAT deal for the consumer!

Am I to be led to believe that Hyundai would be making a dire mistake to start a new luxury brand and charge an additional $5k for the Equus to guarantee better service, an upscale dealership experience and a snobby badge? Or should they just sell it as a Hyundai for YOUR best interests so YOU can afford one?

$65k for a nicely equipped Equus is STILL an amazing deal. While comparable vehicles from other companies are costing $80k, you're still getting a far better price from Hyundai's luxury division - so what you are to complain about?

Sure, it would be nice for Hyundai to keep pumping out amazing cars that equal or even surpass their top-tier competitors - and sell them for nothing. But how long do you think that's going to last? Eventually, they're going to HAVE to charge more for these vehicles - so at some point or another, if you want to enjoy the luxuries that people with more money enjoy, you're going to have to pay the price - whether it's badged as a "Hyundai" or a "Look what I've got"...

A few years back, I believed all the hype about BMW, so I bought one. What a POS! Was not at all the car I expected. Always had problems with the center U-Joint. The straw that broke the camels back was one day, I was in a 270 degree Expressway On-Ramp, at the limit of traction. Looked in my mirror and saw a Nissan FWD in my rear view mirror. Thats it!!!!!
Found someone else who believed all the BMW hype, sold it to him, then bought a performance Pontiac. Was never sorry.

 

[Pahaska]

A few years back, I believed all the hype about BMW, so I bought one. What a POS!

I had a BMW 2000 (not a 2002) about 40 years ago when BMWs were rare in the states. It had some minor mechanical problems,. but the BMW was head and shoulders better than the American cars in those days in quality and handling. I used to set the valves just to look again at the beautiful head cover casting.

Later, I bought the one and only Mercedes I'll ever own. For the cost, it was the worst car I have ever owned except for a 1972 Blazer. I had that car in to the dealer over and over; it took 3 or 4 visits just to get the AC working properly. I have a ling list of things that broke in that car and it had the worst automatic transmission that I have ever driven.

 

[Mark_888]

The mathematics of unit volumes on the Genesis (and potentially the Equus) do not justify separate dealerships. The main reason these cars were imported in the fist place is to build the Hyundai brand name, which got off to a very rocky start when they first came to the US and are still suffering from that. The actual profits from the Genesis (and Equus when it comes) is minuscule) compared to the other vehicles they sell. Oil prices will likely go back up, and small efficient cars are the future of Hyundai. Creating a separate brand and dealership network will basically defeat the purpose for Hyundai importing these upscale cars to North America.

 

[Mark_888]

Later, I bought the one and only Mercedes I'll ever own. For the cost, it was the worst car I have ever owned except for a 1972 Blazer. I had that car in to the dealer over and over; it took 3 or 4 visits just to get the AC working properly. I have a ling list of things that broke in that car and it had the worst automatic transmission that I have ever driven.

One thing you learn about Germany if you ever go there, is that it rarely gets very hot (southern Germany is about the same latitude as southern Canada), and almost no one drives an automatic transmission there. In more recent years, the German car manufacturers have improved both their A/C and their auto transmissions (often by buying them from other companies), but before that they were usually problems as you found out.

 

[MattG]

I think that the bottom line is that when it comes to the cost of the car, there are a few different types of car buyers out there:

• people who want to buy the best
• people who want to buy the cheapest
• people who want to get a "good deal"

Obviously it isn't really that simple, and most buyers will actually embody all three of those values to some degree.

The luxury brands market themselves to people who want "the best" more than they want the other values.

Hyundai has traditionally (in the US) been squarely targeted at people who want "the cheapest", and recently has been making great strides (IMHO) to migrating from "the cheapest" to "a good deal".

The interesting thing about "a good deal" is that it is a great place for people who used to be "cheap" buyers to move up to, and it is also a great place for people who have been burned by "the best" to fall back to. There are probably plenty of people who shoehorned themselves into a BMW or Benz lease, but due to the economy, their 401K, new additions to the family, etc., they really need to get more for their money. On the other hand, having a taste of the finer things, they are not really all that interested in giving up on them.

Because of the strong performance of the rest of their lineup, especially the Sonata, Hyundai is pretty much in the perfect position to work on their brand identity, and see how the US responds to the Genesis and Equus over a longer period of time.

Things will get interesting when the economy really starts to hum again - either Genesis and Equus sales will fail to keep pace with the increase in premium sales (indicating that people are returning to traditional luxury brands when they feel more flush) or their sales will outperform the average luxury sales increase, indicating that Hyundai has made permanent inroads, and, IMHO, justifying the expansion to a dedicated luxury brand, and dealer network.

Just my .02.

 

[musher51]

Things will get interesting when the economy really starts to hum again - either Genesis and Equus sales will fail to keep pace with the increase in premium sales (indicating that people are returning to traditional luxury brands when they feel more flush) or their sales will outperform the average luxury sales increase, indicating that Hyundai has made permanent inroads, and, IMHO, justifying the expansion to a dedicated luxury brand, and dealer network.

Just my .02.

A very rational argument. Thanks for a thoughtful post. Clearly, there are several paths in front of Hyundai right now, and it'll be interesting to see how the 2nd and 3rd year sales of Genesis (both sedan & coupe) and the introduction of Equus influence the overall performance -- and perception -- of HMA and corporate Hyundai over the next few years. Might be time to buy some stock, eh?