Genesis plans 3rd utility to balance lineup

[Mark_888]

Not my problem that you have limited reading comprehension and a short attention span (and really, the points are pretty simple).

Very few people read your entire posts when they get long.

Again, you (not surprisingly) also FAILED to answer the question (not that difficult a question to answer - just need an number figure).

The larger Santa Fe starts at $30K and the Acura MDX starts at $44K and goes to over $58 (not counting Hybrid). A Genesis based on the Santa Fe could start at $38 in base trim and go up to $50K and stay below Acura. I don't see what is the big deal? Both Acura MDX and Lexus RX have SUV's based on Honda and Toyota Models (Pilot and Highlander). It's not rocket science.

And it's hardly just the pricing issue by (going w/ FWD) and Hyundai wanting to the Genesis brand to be a less expensive alternative to BMW and MB rather than Lexus (or Acura - as far as crossovers go).

Kia is slated to launch a RWD crossover based on the G80 platform sometime around 2019 (based on the Telluride concept) - which will, at the very least, get the TTV6 and possibly the Tau V8.

Yeah, Hyundai should've gone w/ cheaper FWD CUVs when Kia is going w/ a RWD one for its premium CUV. lol

Genesis could have gone with a FWD/AWD SUV for the first few years and then switched over to RWD/AWD later. I don't think RWD is as popular as you think. Lexus and Acura (as well as Toyota, Honda, and others) sell a very large number of FWD SUV's.

I am amazed that Genesis thinks they can just skip over the Lexus and Acura SUV market and go head to head with BMW and MB. Having some competition at the higher end is OK, but IMO it would best to compete against all of them (including Acura and Lexus).

 

[YEH]

The larger Santa Fe starts at $30K and the Acura MDX starts at $44K and goes to over $58 (not counting Hybrid). A Genesis based on the Santa Fe could start at $38 in base trim and go up to $50K and stay below Acura. I don't see what is the big deal? Both Acura MDX and Lexus RX have SUV's based on Honda and Toyota Models (Pilot and Highlander). It's not rocket science.

And that's the WHOLE point.

The Lexus brand is cheapened b/c of its over-reliance on cheaper FWD/transverse models for sales, including its crossovers.

As much as Lexus likes to say that it competes against the Germans, it now competes more against the likes of Acura, Lincoln, Volvo and the Cadillac XT5 (and certain Buick models).

The NX and RX F-Sport are a complete joke when it comes to be being performance-oriented crossovers.

Again, it's the same reason why Hyundai didn't bring over its ES competitor, the Aslan, for the Genesis brand.

And again, the Sorento SX-L stickers for $49.7k w/ options added.

Genesis could have gone with a FWD/AWD SUV for the first few years and then switched over to RWD/AWD later. I don't think RWD is as popular as you think. Lexus and Acura (as well as Toyota, Honda, and others) sell a very large number of FWD SUV's.

That would be doing it half-arsed and making a good first impression is everything; plus, it goes against everything Hyundai is trying to do with the Genesis brand.

Also, buyers would then be confused by the price hike with the switch-over to RWD.

I did not say that RWD would be popular or more popular; I specifically stated that Hyundai is willing to lose some sales/marketshare by foregoing the cheaper FWD-based route, but then would make up for some it it via higher transaction prices (in part allowed by performance trims).

I am amazed that Genesis thinks they can just skip over the Lexus and Acura SUV market and go head to head with BMW and MB. Having some competition at the higher end is OK, but IMO it would best to compete against all of them (including Acura and Lexus).

Being a more value-oriented option for BMW and MB seems to be pretty good business-decision compared to being a more value-oriented option for Lexus and Acura.

Hyundai recently hired noted chassis/platform engineer, Fayez Abdul Rahman, from BMW - who will be in charge of architecture development for Genesis.

They're not spending top-dollar for guys like Biermann and Rahman in order to make competitors for the NX/RX and RDX/MDX based off of platforms which underpin the Elantra/Tucson and Sonata/Santa Fe.

And it seems like the upcoming GV80 will be the first Genesis model to get use of the new platform (which will also underpin the next G80).

Think the G90 is a solid effort for Genesis, but hardly great (the next gen model should be greatly improved) and yet, the G90 has repeatedly gotten higher marks than the Continental in comparison tests and part of the reason is due to architecture.

(Going back to the whole smaller car thing - you claimed that Hyundai mostly sells smaller cars in the major metro markets; something I easily debunked by showing sales data which listed the Sonata to be the #1 seller for Hyundai in markets like the NYC metro area).

 

[Mark_888]

That would be doing it half-arsed and making a good first impression is everything; plus, it goes against everything Hyundai is trying to do with the Genesis brand.

I would say that the result so far has been quarter-arsed. Seems like a lot of nagging problems on the G80, just to name a few:

• Poor condensation drainage inside HVAC system, causing excessive mold and mildew.
• Sunroofs that either make noises (even when closed) or the glass shatters.
• Severe electrical problems that cause cars to shut off, or drain the battery.
• Excessive vibration in the steering wheel during engine idle.
• Brakes that have warped rotors on too many cars to be a dealer problem.
• Ultimate Trim infotainment system lacks Android Auto and Apple Car Play even though lower level trim levels have it (may have been addressed in 2018, not sure).

Most of the above are extremely embarrassing problems if an owner is trying to impress their friends.

Even the Genesis website stinks, as it lacks accurate and easy to find information about which features go with which trim levels. Too much form, and not enough function or hard content.

Genesis Motors? No thank you.

 

[YEH]

^ Clearly, Hyundai does not want the Genesis brand to be a less expensive alternative to Lexus, Acura, Infiniti, Lincoln - but rather a less expensive alternative MB, BMW and the like; every auto-maker, including Lexus, has those types of issues. but once you go down the being an Acura-competitor route, it's going to be very difficult to switch course and be seen as a BMW/MB competitor (at a discount, of course).

If you can't see that, then that's your problem.

Plus, there's the whole production capacity end of the equation which you have totally overlooked.

Hyundai already couldn't supply the worldwide market with enough of the CUVs that it did have, including the Tucson and the upcoming Kona (which will be under-supplied due to capacity constraints), so you expected them to have been able to produce 2-3 more CUVs for Genesis at the bat?

In order for Genesis to have any semblance of adequate supply for its planned full lineup, Hyundai will have to build a new plant somewhere and the rumors are that they are looking to either expand its 'Bama facility or build another separate plant in the US.

And in key markets for the Genesis brand (Korea and the Middle East), Kia still sells the Borrego (under the Mohave nameplate).

Wouldn't be prudent to have a non-luxury Kia SUV not only be pricier than a Genesis CUV, but have more power as well.

If the rumors of the demise of the GS are true, then Lexus will truly become a tarted up Toyota brand (sales of the LS, even the new one, will hardly be enough to make up for it).

 

[EdP]

Interesting arguments on both side. No matter how long this goes on, we really won't know who is right for about five more years. The Asian mindset is also different that what the US corporate mind is looking for results. Sure, sales would be higher if the has an SUV but they want to sell the right version. They are looking at the long haul, not next quarter's ROI and they don't want an Edsel..

 

[Mark_888]

If the rumors of the demise of the GS are true, then Lexus will truly become a tarted up Toyota brand (sales of the LS, even the new one, will hardly be enough to make up for it).

All the talk of Lexus being a "tarted up" or "gussied up" brand are ridiculous. Lexus has been one of the most successful brands in its segment in automotive history.

I personally don't want unique or exclusive technology, I want tried and true technology, and if that means that Lexus uses the same engine in a ES sedan as is used in a Toyota Avalon, all the better. In short, I value good designs that are reliable, not creative originality. I am not interested in being in on the "bleeding edge" of any technology, whether it is in computers or automobiles.

The fact that the Hyundai 4.6 Tau V8 (brand new in first 2009 Genesis) had major problems its first year, as did the new GDI 5.0 version in 2012, is a perfect example of why new and exclusive is not always better (and in fact, seldom is better). The new Hyundai 8-speed transmission also had a lot of problems its first year in 2012.

The very fact that the Lexus GS is not selling these days proves the point that the market doesn't care about uniqueness. Lexus models (ES, RX, etc) derived from similar Toyota models are preferred by the public and are selling very well, both because they are more reliable than a unique design would be, and because they are more cost effective to manufacture (and thus more reasonably priced).

As far as RWD vs FWD, some people who like to pretend they are driving race cars may care about that, most people don't care, and actually prefer FWD if that allows them to not have to buy an AWD model for snow days. Where I live, on SUV models that offer either FWD or AWD, FWD outsells AWD versions by about 8 to 1.

Someone at Hyundai decided a long time ago to not use a Santa Fe as the basis for the first Genesis SUV. Once that decision was made, they have to live with it, and everything else is just excuses for what the delay in a Genesis SUV means (inability to rollout dedicated Genesis dealerships on a more rapid basis). That delay in dedicated Genesis dealerships, and reliance on existing Hyundai dealerships to sell and service the Genesis (with the crappy Hyundai sales and service experience) is what continues to hurt the brand image of Genesis far more than a nicely upgraded Santa Fe would have.

 

[PMCErnie]

All the talk of Lexus being a "tarted up" or "gussied up" brand are ridiculous. Lexus has been one of the most successful brands in its segment in automotive history.

I personally don't want unique or exclusive technology, I want tried and true technology, and if that means that Lexus uses the same engine in a ES sedan as is used in a Toyota Avalon, all the better. In short, I value good designs that are reliable, not creative originality. I am not interested in being in on the "bleeding edge" of any technology, whether it is in computers or automobiles.

The fact that the Hyundai 4.6 Tau V8 (brand new in first 2009 Genesis) had major problems its first year, as did the new GDI 5.0 version in 2012, is a perfect example of why new and exclusive is not always better (and in fact, seldom is better). The new Hyundai 8-speed transmission also had a lot of problems its first year in 2012.

The very fact that the Lexus GS is not selling these days proves the point that the market doesn't care about uniqueness. Lexus models (ES, RX, etc) derived from similar Toyota models are preferred by the public and are selling very well, both because they are more reliable than a unique design would be, and because they are more cost effective to manufacture (and thus more reasonably priced).

As far as RWD vs FWD, some people who like to pretend they are driving race cars may care about that, most people don't care, and actually prefer FWD if that allows them to not have to buy an AWD model for snow days. Where I live, on SUV models that offer either FWD or AWD, FWD outsells AWD versions by about 8 to 1.

Someone at Hyundai decided a long time ago to not use a Santa Fe as the basis for the first Genesis SUV. Once that decision was made, they have to live with it, and everything else is just excuses for what the delay in a Genesis SUV means (inability to rollout dedicated Genesis dealerships on a more rapid basis). That delay in dedicated Genesis dealerships, and reliance on existing Hyundai dealerships to sell and service the Genesis (with the crappy Hyundai sales and service experience) is what continues to hurt the brand image of Genesis far more than a nicely upgraded Santa Fe would have.

+ 12

 

[turnne]

^ Clearly, Hyundai does not want the Genesis brand to be a less expensive alternative to Lexus, Acura, Infiniti, Lincoln - but rather a less expensive alternative MB, BMW and the like; every auto-maker, including Lexus, has those types of issues. but once you go down the being an Acura-competitor route, it's going to be very difficult to switch course and be seen as a BMW/MB competitor (at a discount, of course).

If you can't see that, then that's your problem.

Plus, there's the whole production capacity end of the equation which you have totally overlooked.

Hyundai already couldn't supply the worldwide market with enough of the CUVs that it did have, including the Tucson and the upcoming Kona (which will be under-supplied due to capacity constraints), so you expected them to have been able to produce 2-3 more CUVs for Genesis at the bat?

In order for Genesis to have any semblance of adequate supply for its planned full lineup, Hyundai will have to build a new plant somewhere and the rumors are that they are looking to either expand its 'Bama facility or build another separate plant in the US.

And in key markets for the Genesis brand (Korea and the Middle East), Kia still sells the Borrego (under the Mohave nameplate).

Wouldn't be prudent to have a non-luxury Kia SUV not only be pricier than a Genesis CUV, but have more power as well.

If the rumors of the demise of the GS are true, then Lexus will truly become a tarted up Toyota brand (sales of the LS, even the new one, will hardly be enough to make up for it).

LOL....full of assumptions
If you think the German buyer is looking at a Genesis..you are kidding yourself
Completely different driving experience

Now....both Acura and Lexus are selling tons of crossovers because that is their buyer today
Clearly...the luxury sedan buyers are in the german car dealerships
That German buyer seems to prefer innovations, first to market technology and a completely different driving experience than the Asian cars provide

Genesis will never get out of the Hyundai dealer if they don't start selling some small crossovers( rebadged Hyundais etc)

Don't be fooled
If one of the most respected brands in the United States..Lexus...has to rely on these type of vehicles for their bread and butter

Genesis is going to have to rely on this same type of formula
Perhaps if they can get their cars out of the Hyundai dealer the resale values would be better as well

That's a major scare among buyers who might even look at one
The general idea is that the car value will drop like a stone

Warren

 

[YEH]

(Wait, thought people get bored reading min-treatises. Typical - lol)

All the talk of Lexus being a "tarted up" or "gussied up" brand are ridiculous. Lexus has been one of the most successful brands in its segment in automotive history.

Yes, they have been the most successful Asian luxury brand (by a good margin), but if you have been paying closer attention (instead of looking at things superficially as you often do), Lexus' ATP is more akin to Lincoln and Acura's than it is to BMW or MB.

And a big part of that is their increased reliance on the said "tarted up" Toyotas for sale as higher priced RWD GS and LS sales have fallen off a cliff.

And things in that regard are only going to get worse as Toyota is planning on a CH-R based Lexus model to slot underneath the RAV-4 based NX.

Acura has been weakening as a brand and basically its CUVs are keeping it afloat.

Lexus is becoming more and more like Acura - increasingly reliant on its cheaper FWD-based CUVs for sales (in addition to the ES); not surprisingly, Acura is working on an HR-V based CUV.

I personally don't want unique or exclusive technology, I want tried and true technology, and if that means that Lexus uses the same engine in a ES sedan as is used in a Toyota Avalon, all the better. In short, I value good designs that are reliable, not creative originality. I am not interested in being in on the "bleeding edge" of any technology, whether it is in computers or automobiles.

Good for you - then go buy a Lexus.

But many luxury buyers (esp. at the higher end) have been turning away from Lexus and Toyota has been painfully slow to upgrade the powertrains for Lexus and Lexus isn't only outgunned by the Germans, but for the most part, by Genesis.

The fact that the Hyundai 4.6 Tau V8 (brand new in first 2009 Genesis) had major problems its first year, as did the new GDI 5.0 version in 2012, is a perfect example of why new and exclusive is not always better (and in fact, seldom is better). The new Hyundai 8-speed transmission also had a lot of problems its first year in 2012.

That's the norm (for new components needing to have the kinks worked out) - which is the reason why reliability scores for Acura have tanked as they have been trotting out new engines/transmissions.

But if an auto-maker is too afraid to bring to market new powertrains, they get left behind - which is exactly what has happened to the GS and LS460.

The GS-F doesn't sell b/c it's not only outgunned by the Germans, but by the CTS-V as well (which sells far better than the GS-F).

The demand for AMG and M variants is simply booming; can't say the same for Lexus' F division.

The very fact that the Lexus GS is not selling these days proves the point that the market doesn't care about uniqueness. Lexus models (ES, RX, etc) derived from similar Toyota models are preferred by the public and are selling very well, both because they are more reliable than a unique design would be, and because they are more cost effective to manufacture (and thus more reasonably priced).

You are mistaking not wanting uniqueness for buyers at the lower end of the luxury market caring more about value and reliability.

Buyers at the higher end of the luxury market care about such things (which is why Mercedes offers a dizzying level of customization) as well as performance - which is why high end buyers keep on buying the S Class and why (as stated above) that AMG is doing booming business.

And you are mistaken if buyers at the lower end of the market don't care about uniqueness - that's the very reason why Lexus has gone with its current design language (even if it turns away a good portion of its older/wealthier clientele).

Even on mainstream models like the Kia Soul or Hyundai Kona - there is a high level of customization offered with all sorts of add-ons/paint colors - something that Toyota is doing with the CH-R.

As far as RWD vs FWD, some people who like to pretend they are driving race cars may care about that, most people don't care, and actually prefer FWD if that allows them to not have to buy an AWD model for snow days. Where I live, on SUV models that offer either FWD or AWD, FWD outsells AWD versions by about 8 to 1.

And people who don't care about that stuff (again) are VALUE buyers.

Why do you think the RX, MDX, XT5 and MKX don't come anywhere close to the pricing of the GLE and X5?

They are all based on mid-sized platforms and are available with AWD.

The Continental is Lincoln's full-size sedan is it not

Then why does it start at the G80's price-point and not that of the G90 and that's with Genesis being the new entrant in the luxury market and not having the pricing power of Lexus, much less of MB?

In fact, all these FWD-transverse layout, full-size flagship sedans (Conti, XTS, S90 and RLX) are priced in the midsize segment and the Avalon-based ES is actually priced a segment lower in the compact/emtry-level segment.

Again, there's a reason why Audi does not offer the A7 and A8 in the States in FWD and Audi is contemplating switching to a RWD platform for the A8.

You can say 'til you're blue in the face that FWD-RWD doesn't matter, but it does and the proof is in the pudding - MSRPs and ATPs

And it isn't all at the higher end of the luxury market either as the X3 and GLC are markedly more expensive than the NX and RDX (in fact, can be equipped more expensively than the NX and MDX).

Why is the ILX priced beneath well beneath the IS? They are both compact Japanese luxury sedans.

Someone at Hyundai decided a long time ago to not use a Santa Fe as the basis for the first Genesis SUV. Once that decision was made, they have to live with it, and everything else is just excuses for what the delay in a Genesis SUV means (inability to rollout dedicated Genesis dealerships on a more rapid basis). That delay in dedicated Genesis dealerships, and reliance on existing Hyundai dealerships to sell and service the Genesis (with the crappy Hyundai sales and service experience) is what continues to hurt the brand image of Genesis far more than a nicely upgraded Santa Fe would have.

And it was the correct decision.

As noted here...

https://genesisowners.com/hyundai-genesis-forum/showthread.php?21985-Lincoln-smart-Genesis-dumb

LOL....full of assumptions
If you think the German buyer is looking at a Genesis..you are kidding yourself
Completely different driving experience

Again, the only person kidding themselves is you. lmao

There a numerous Genesis owners here who came from German sedans (or concurrently own a Genesis and German auto).

Now, grant you, the majority won't due to the said driving dynamics or diff. in prestige, but there are those who have done exactly that.

And as for the driving dynamics part - that will change with the G70.

Now....both Acura and Lexus are selling tons of crossovers because that is their buyer today

There are still plenty of buyers for the 3/4 Series and C Class - which are the respective best sellers for BMW and MB.

Not everyone has shunned sedans (Lexus and Acura sedans just aren't competitive any more unless they really bring the value equation to the table like the ES).

After all, Toyota and Honda have invested heavily in the new Camry and Accord (for Honda, the Civic and Accord are still huge sellers b/c they are very competitive, if not class leading).

Funny - Honda and Toyota seem to be able to sell their sedans, but their luxury channels increasingly struggle to do so.

Clearly...the luxury sedan buyers are in the german car dealerships

Thanks for arguing MY point (did you not realize that?).

So luxury buyers abandon Japanese sedans (aside from the ES and Infiniti Q50) b/c of the switch-over to CUVs, but not when it comes to the Germans?

Or as you state - are in German dealerships.

Hmmm - ever wonder why that is?

And it's not just the Germans (well, really just MB and BMW here in the States), but the addition of new competitors whether that be Cadillac, Lincoln or yes, Genesis (can also throw in Jaguar).

The buyer today has a lot more choices than even just 10 years ago, much less 2 decades ago.

That German buyer seems to prefer innovations, first to market technology and a completely different driving experience than the Asian cars provide

Can't put the Germans in the same bowl when it comes to driving experience.

And besides, the GS was considered to be the sportier drive than the last gen 5 Series and the new LS 500 is a sportier drive than the S Class.

And really, don't think the typical German buyer cares about scent-dispensing modules or gesture control.

Perceived prestige and performance are another matter.

Genesis will never get out of the Hyundai dealer if they don't start selling some small crossovers( rebadged Hyundais etc)

Except they are the crossovers won't be rebadged Hyundais (putting aside that all Genesis models are Hyundais as all Lexus autos are Toyotas, etc.).

Don't be fooled
If one of the most respected brands in the United States..Lexus...has to rely on these type of vehicles for their bread and butter

And why does Lexus have to rely on cheaper FWD-based models as their bread and butter?

Along that basis, why is Lexus' ATP more in line with Lincoln and Acura and not MB or BMW?

Genesis is going to have to rely on this same type of formula

Sure - everyone not MB has to rely on the value formula (even BMW to a certain extent except when it comes to the 3/4 Series).

The difference is that Genesis will be making at least 2 of their CUVs RWD based.

So while the pricing will still have to be of value against the Germans, doesn't really need to be so against the Japanese competition.

Maybe pricing parity for the GV80 with the RX, MDX and JX at the start - but in time can see the GV80 pass them on price.

And can see the GV80 go higher than them in price-range with a performance version.

 

[Mark_888]

Good for you - then go buy a Lexus.

But many luxury buyers (esp. at the higher end) have been turning away from Lexus and Toyota has been painfully slow to upgrade the powertrains for Lexus and Lexus isn't only outgunned by the Germans, but for the most part, by Genesis.

It's powertrain problems that have hurt Lexus and Toyota. For example, Toyota (and Lexus) have an extremely innovative gasoline engine that runs normally with GDI, but has the ability to switch to EFI at times to clean the valves and prevent carbon buildup.

It is their styling which is hurting Lexus and Toyota, which is starting to become hideous. Even the new 2018 Honda Accord styling is hideous, especially the alloy wheels.

It is obvious to me that the Fukushima nuclear disaster of a few years has had much wider impact than many suspected, and has caused massive brain damage at many Japanese companies.

- - - Updated - - -

And it was the correct decision.

No it was not. Waiting 4 years for a Genesis SUV was not the correct decision, and has slowed the rollout of dedicated Genesis Motors dealerships to a crawl, because no stand-alone dealer can make money without a single SUV/CUV.

Even the new Bentley SUV is now their best-seller.

______________________________

Help support this site so it can continue supporting you!

 

[PMCErnie]

Yes, again Mark has said it all. Saved me a lot of typing! The first Genesis SUV (based on the RWD/AWD Santa Fe Sport), should have been in showrooms by 2015.

 

[YEH]

It's powertrain problems that have hurt Lexus and Toyota. For example, Toyota (and Lexus) have an extremely innovative gasoline engine that runs normally with GDI, but has the ability to switch to EFI at times to clean the valves and prevent carbon buildup.

I suspect you meant that that powertrain problems have not hurt Lexus, but I beg to differ.

The GS and LS kept on with basically the same NA V6 and V8 while the Germans kept upgrading power/performance.

The Toyota discontinued the V8 for the GS and later brought it back in the form of the GS-F (which is badly outgunned by the CTS-V, much less the Germans - where comparison tests are done with the CTS V-Sport and not the CTS-V).

The turbo-4 that Lexus uses is quite anemic.

IIt is their styling which is hurting Lexus and Toyota, which is starting to become hideous. Even the new 2018 Honda Accord styling is hideous, especially the alloy wheels.

Funny you say that, considering Lexus fanbois have defended the current design language by saying how strong sales are with the RX, NX, ES, etc.

And ugly or extremely bland designs have hardly prevented numerous Toyotas and Hondas from being best-sellers.

(As I had stated before, the design language likely has turned off some of Lexus' older, long-time clientele.)

No it was not. Waiting 4 years for a Genesis SUV was not the correct decision, and has slowed the rollout of dedicated Genesis Motors dealerships to a crawl, because no stand-alone dealer can make money without a single SUV/CUV.

Has had ZERO impact on the rollout of dedicated Genesis dealerships.

Doing it right and proper is better than doing a quick hack-job.

As I had pointed out in the other thread, the Lincoln CUVs aren't exactly selling well compared to the their FWD competition and that's even with a pricing advantage.

All this stuff is noot anyways, as I have repeatedly pointed out that Hyundai did not have the production capacity.

 

[Mark_888]

I suspect you meant that that powertrain problems have not hurt Lexus.

Yes, that is what I meant.

 

[PMCErnie]

My local Hyundai dealership ((which sells the current Genesis vehicles) would beg to differ with YEH about just how much the lack of Genesis SUVs/Crossovers has hurt their business. According to them, they are also prohibited from hanging a Genesis Motors sign outside of their Hyundai dealership. In other words, they are currently trying to sell Genesis vehicles with two arms tied behind their backs.

Down the street, Fords and Lincolns are sold at the same dealership and, YEAH, both brands' signs are out front.

 

[Mcc]

My local Hyundai dealership ((which sells the current Genesis vehicles) would beg to differ with YEH about just how much the lack of Genesis SUVs/Crossovers has hurt their business. According to them, they are also prohibited from hanging a Genesis Motors sign outside of their Hyundai dealership. In other words, they are currently trying to sell Genesis vehicles with two arms tied behind their backs.

Down the street, Fords and Lincolns are sold at the same dealership and, YEAH, both brands' signs are out front.

But aren’t they just guessing or wishing about a car that they have not seen at a price point that they know nothing about?

 

[EdP]

My local Hyundai dealership ((which sells the current Genesis vehicles) would beg to differ with YEH about just how much the lack of Genesis SUVs/Crossovers has hurt their business. According to them, they are also prohibited from hanging a Genesis Motors sign outside of their Hyundai dealership. In other words, they are currently trying to sell Genesis vehicles with two arms tied behind their backs.

Down the street, Fords and Lincolns are sold at the same dealership and, YEAH, both brands' signs are out front.

Dual brand dealerships have been around over 65 years that I'm aware of. I don't know the plan aside from Hyundai wanting to have stand alone Genesis dealers in the next couple of years. It would seem smart to add the Genesis sign but in a couple of years they may have to come down. I don't know if there are any legal implications to all of that. Remember the Cadillac Allante? If you were a Cadillac dealer and wanted to sell that model you had to pay a $50,000 franchise fee, according to the dealer here in town. Maybe Genesis has some deal like that too.
Evidently, Hyundai is willing to take the time to roll out the brand in slow steps to get it what they feel is the right way in the end. Two sedans is not going to support a stand alone dealer yet, but it will be 4 or 5 models soon, designed to be a Genesis, not a gussied up Chevy Cavalier to be sold as a Cadillac Cimarron.

 

[YEH]

My local Hyundai dealership ((which sells the current Genesis vehicles) would beg to differ with YEH about just how much the lack of Genesis SUVs/Crossovers has hurt their business. According to them, they are also prohibited from hanging a Genesis Motors sign outside of their Hyundai dealership. In other words, they are currently trying to sell Genesis vehicles with two arms tied behind their backs.

Down the street, Fords and Lincolns are sold at the same dealership and, YEAH, both brands' signs are out front.

And you know what else Hyundai dealerships wanted?

1. Greater supply of the Santa Fe/Sport - which they got (starting last summer), but wouldn't have if Hyundai had done an SF-based Genesis CUV (more on that later).

2. Greater supply of the Tucson - which they got with the production of the current Tucson, but still not enough (Toyota, Honda and Nissan make as many RAV-4s, CR-Vs and Rogues as Hyundai has capacity at its Alabama plant - which now produces 3 models).

3. Greater supply of the Kona - which hasn't even hit the lots yet (the allocation allotment Hyundai has for the Kona in the US won't meet demand).

4. A larger 3-row CUV than the Santa Fe to better compete against the roomier 3-row CUVs like the Pilot, Pathfinder and Explorer.


So Hyundai can't supply Hyundai dealerships adequately of the CUVs they do have, so they're supposed to spend the $$ to develop and launch an all-new model when they already are capacity crunched?

As for the larger 3-row CUV, that has long been on the list of demands for Hyundai dealerships, but it's not as if Hyundai could just speed up development of a larger 3-row.

There's a complex time-table involved which involves available production capacity, available resources (such as engineers) as well as getting at least adequate ROI on investments previously made.

The larger 3-row had to wait until the Santa Fe was at the end of its life-cycle with the larger 3-row set to replace it (and likely will get a new name in order to differentiate it from the smaller SF Sport; the new one supposedly getting more rugged and "sporty").

Going back to #1, if Hyundai had done a Genesis version of the SFS, then they wouldn't have been able to supply Hyundai dealerships w/ additional supply of the SFS as the Alabama plant would have been producing the Genesis CUV instead of more of the SFS.

Hyundai spent over $50 million to get its 'Bama plant ready to produce the SFS w/ annual production set at 36,700 (w/ the requisite reduction in Elantra and Sonata production).

How much more do you think Hyundai would have had to spend (beyond that $50 mil) to develop an all-new CUV model and prepare the tooling to only build some 35k of a Genesis CUV? (Note that Lincoln only sells about 30k of the MKX annually).

Not only did it make a lot more sense financially to build more of the SFS (just required retooling of a factory - no need to spend $$ on R&D and in casting the tooling), Hyundai dealerships would have been in favor of that as well (as less than 1 in 3 Hyundai dealerships are designated to sell the G90, whereas all 800 or so of them can sell the SFS).

If Hyundai had gone ahead with a SFS-based Genesis CUV, there would have been the issue of its life-cycle (tho probably would have delayed the development of the GV80/GV70 and/or the larger 3 row Hyundai CUV; only so many engineers to go around).

Production of it would have only started last summer and the GV80 is slated to launch late in 2018 or in 2019 - which would leave for a truncated life-cycle for the SFS-based CUV (further lessening the ROI, on top of annual production and sales being not much more than 36k; automakers would go out of business if they kept spending the $$ to develop models which only sell around 35k in volume).

Not to mention a confused clientele who would be wondering why the Genesis midsize CUV now costs substantially more.

What would have equally hurt your local Hyundai dealership is not having as many Santa Fe Sports to sell.

And we all all that dealerships are the epitome of looking at the long-term strategy instead of the quick sell today.

(Such as Kia dealerships annoyingly pushing a loaded Optima or the Cadenza on prospective buyers for the Stinger - who have no interest in either the Optima or Cadenza - and end up getting turned off from buying from Kia altogether.)

As for Hyundai not allowing the dealership to hang Genesis signs - well, that's an entirely different issue.

Which has to do with who will be getting the stand-alone Genesis dealerships (fewer than 100 with a # of them for auto-groups who currently don't own a Hyundai dealership), so in all likelihood, your Hyundai dealership won't be getting Genesis dealership.

Like I have stated about the MKX, Lincoln dealerships only sell around 30k of them annually.

The Lincoln brand has some 1,200 stores (cut down from 1,500 in 2000) which means on average 25 MKX sales yearly per dealership.

Ford tried to cut that 1,200 dealership # down further (not sure if they were successful or where they are in the process), but even just taking the 500 stores in the major metro areas - that's still not a great # on a per dealer basis (still just 60 sales annually even if one figures that the other 700 Lincoln dealerships which are not located in a metro area sell zero).

The problem w/ you (and Mark) is that you have only looked at this issue in a very narrow and superficial manner when there are so many variables to be factored into the decision.

Like I had said time and time again - this whole thing is a moot point as Hyundai didn't have the production capacity and if they were to have done this, they would have had to sacrifice the added SFS production which started last summer.

And I'm hardly one who has been quiet when it has come to criticizing the missteps of Hyundai's management, nor the design and execution of their vehicles (including for Genesis).

Stated 4-5 years ago that Hyundai needs to look to building another plant in the US (or at least somewhere in NA) dedicated to building crossovers.

Have repeatedly criticized them for not planning adequate production capacity for the Santa Fe/Sport and Tucson and now even for the Kona (which hasn't hit the lots here).

But regardless, think both of you are being extremely short-sighted when it comes to where the execs at Genesis want to take the brand.

Like I have stated numerous time before, they do not want Genesis to be seen as a less expensive alternative to Lexus, Acura, Infiniti, Cadillac (or even w/ Buick when it comes to CUVs), Volvo, etc.

Right now, the luxury CUV market is full w/ the cheaper FWD-based CUVs with more on the way.

How does the Genesis brand differentiate itself?

By eschewing the Santa Fe and Tucson based crossovers and sticking to RWD.

One could very well argue why did Hyundai go RWD with the Genesis and Equus sedans when they could have just stuck with tarted up Sonatas and Azeras (like what Acura has done and what Lexus has done w/ the ES)?

Hyundai in fact did do their own version of the Lexus ES - a large premium FWD sedan meant for the upper-middle class housewife (the Aslan) and it totally flopped in the Korean market.

As stated, Hyundai is looking to do things right in filling out the Genesis lineup and the GV80 and GV70 not only will be on RWD platforms, but heavily revised platforms from the ones that underpin the G80 and the G70 - which will also underpin the G80 replacement (so they will be getting the newest/best platforms from Genesis).

 

[PMCErnie]

Let me put it this way. Nobody would even sell lemonade without putting up a sign that says LEMONADE FOR SALE.

- - - Updated - - -

And you know what else Hyundai dealerships wanted?

1. Greater supply of the Santa Fe/Sport - which they got (starting last summer), but wouldn't have if Hyundai had done an SF-based Genesis CUV (more on that later).

2. Greater supply of the Tucson - which they got with the production of the current Tucson, but still not enough (Toyota, Honda and Nissan make as many RAV-4s, CR-Vs and Rogues as Hyundai has capacity at its Alabama plant - which now produces 3 models).

3. Greater supply of the Kona - which hasn't even hit the lots yet (the allocation allotment Hyundai has for the Kona in the US won't meet demand).

4. A larger 3-row CUV than the Santa Fe to better compete against the roomier 3-row CUVs like the Pilot, Pathfinder and Explorer.


So Hyundai can't supply Hyundai dealerships adequately of the CUVs they do have, so they're supposed to spend the $$ to develop and launch an all-new model when they already are capacity crunched?

As for the larger 3-row CUV, that has long been on the list of demands for Hyundai dealerships, but it's not as if Hyundai could just speed up development of a larger 3-row.

There's a complex time-table involved which involves available production capacity, available resources (such as engineers) as well as getting at least adequate ROI on investments previously made.

The larger 3-row had to wait until the Santa Fe was at the end of its life-cycle with the larger 3-row set to replace it (and likely will get a new name in order to differentiate it from the smaller SF Sport; the new one supposedly getting more rugged and "sporty").

Going back to #1, if Hyundai had done a Genesis version of the SFS, then they wouldn't have been able to supply Hyundai dealerships w/ additional supply of the SFS as the Alabama plant would have been producing the Genesis CUV instead of more of the SFS.

Hyundai spent over $50 million to get its 'Bama plant ready to produce the SFS w/ annual production set at 36,700 (w/ the requisite reduction in Elantra and Sonata production).

How much more do you think Hyundai would have had to spend (beyond that $50 mil) to develop an all-new CUV model and prepare the tooling to only build some 35k of a Genesis CUV? (Note that Lincoln only sells about 30k of the MKX annually).

Not only did it make a lot more sense financially to build more of the SFS (just required retooling of a factory - no need to spend $$ on R&D and in casting the tooling), Hyundai dealerships would have been in favor of that as well (as less than 1 in 3 Hyundai dealerships are designated to sell the G90, whereas all 800 or so of them can sell the SFS).

If Hyundai had gone ahead with a SFS-based Genesis CUV, there would have been the issue of its life-cycle (tho probably would have delayed the development of the GV80/GV70 and/or the larger 3 row Hyundai CUV; only so many engineers to go around).

Production of it would have only started last summer and the GV80 is slated to launch late in 2018 or in 2019 - which would leave for a truncated life-cycle for the SFS-based CUV (further lessening the ROI, on top of annual production and sales being not much more than 36k; automakers would go out of business if they kept spending the $$ to develop models which only sell around 35k in volume).

Not to mention a confused clientele who would be wondering why the Genesis midsize CUV now costs substantially more.

What would have equally hurt your local Hyundai dealership is not having as many Santa Fe Sports to sell.

And we all all that dealerships are the epitome of looking at the long-term strategy instead of the quick sell today.

(Such as Kia dealerships annoyingly pushing a loaded Optima or the Cadenza on prospective buyers for the Stinger - who have no interest in either the Optima or Cadenza - and end up getting turned off from buying from Kia altogether.)

As for Hyundai not allowing the dealership to hang Genesis signs - well, that's an entirely different issue.

Which has to do with who will be getting the stand-alone Genesis dealerships (fewer than 100 with a # of them for auto-groups who currently don't own a Hyundai dealership), so in all likelihood, your Hyundai dealership won't be getting Genesis dealership.

Like I have stated about the MKX, Lincoln dealerships only sell around 30k of them annually.

The Lincoln brand has some 1,200 stores (cut down from 1,500 in 2000) which means on average 25 MKX sales yearly per dealership.

Ford tried to cut that 1,200 dealership # down further (not sure if they were successful or where they are in the process), but even just taking the 500 stores in the major metro areas - that's still not a great # on a per dealer basis (still just 60 sales annually even if one figures that the other 700 Lincoln dealerships which are not located in a metro area sell zero).

The problem w/ you (and Mark) is that you have only looked at this issue in a very narrow and superficial manner when there are so many variables to be factored into the decision.

Like I had said time and time again - this whole thing is a moot point as Hyundai didn't have the production capacity and if they were to have done this, they would have had to sacrifice the added SFS production which started last summer.

And I'm hardly one who has been quiet when it has come to criticizing the missteps of Hyundai's management, nor the design and execution of their vehicles (including for Genesis).

Stated 4-5 years ago that Hyundai needs to look to building another plant in the US (or at least somewhere in NA) dedicated to building crossovers.

Have repeatedly criticized them for not planning adequate production capacity for the Santa Fe/Sport and Tucson and now even for the Kona (which hasn't hit the lots here).

But regardless, think both of you are being extremely short-sighted when it comes to where the execs at Genesis want to take the brand.

Like I have stated numerous time before, they do not want Genesis to be seen as a less expensive alternative to Lexus, Acura, Infiniti, Cadillac (or even w/ Buick when it comes to CUVs), Volvo, etc.

Right now, the luxury CUV market is full w/ the cheaper FWD-based CUVs with more on the way.

How does the Genesis brand differentiate itself?

By eschewing the Santa Fe and Tucson based crossovers and sticking to RWD.

One could very well argue why did Hyundai go RWD with the Genesis and Equus sedans when they could have just stuck with tarted up Sonatas and Azeras (like what Acura has done and what Lexus has done w/ the ES)?

Hyundai in fact did do their own version of the Lexus ES - a large premium FWD sedan meant for the upper-middle class housewife (the Aslan) and it totally flopped in the Korean market.

As stated, Hyundai is looking to do things right in filling out the Genesis lineup and the GV80 and GV70 not only will be on RWD platforms, but heavily revised platforms from the ones that underpin the G80 and the G70 - which will also underpin the G80 replacement (so they will be getting the newest/best platforms from Genesis).

You sure write a lot in defense of a "moot point."

 

[YEH]

^ Too bad you can't refute any of it.

But just continue on your blind rant.

 

[YEH]

Here's a teaser image of the new 2-row Santa Fe.

With a rendering done by Brenthon.

Looks a good bit more upscale than the current model and more luxury than the RX, MDX or QX60.


And a spy shot of the new larger 3-row replacement.

The Kia equivalent, the Telluride is also headed to production.