Hyundai to sell 50,000 Genesis per year, Sonata hybrid coming in 2010

[stimr2]

I think one of the main reason Hyundai raised the initial price was because of the rise in the cost of materials. They've already raised their prices in Korea. http://www.koreatimes.co.kr/www/news/biz/2008/08/123_28570.html

 

[YEH]

Don’t quite understand the preoccupation w/ the estimated initial price point - market conditions change and Hyundai just made adjustments to reflect that.

First off, the sub-$30k price that Hyundai initially stated was w/ Hyundai having in mind to offer 3.3L V-6 engine along w/ the 3.8L V-6 and the V-8 in the US.

Second, the higher price has to do w/ conditions outside of Hyundai’s control such as currency fluctuations and commodity prices. While the strength of the Won has dropped recently, the price of steel, aluminum, platinum, plastics, etc. have gone up 20-40% in the past year or so (it’s the same thing as GM initially stating that the Chevy Volt would be priced at around $30k – now, it appears that a price closer to $40k is more likely).

Remember, the Genesis is a 2009 model – pretty much all other automakers have substantial price increases planned for their 2009 models. For instance, BMW announced a price increase that is on average 2.1% higher. A base 2009 535i now starts at over $50k ($50,800) and a base 550i starts at an even $60k. In addition, BMW took out a few features that were standard and made them options.

Third, the destination charge is included in the MSRP for the Genesis while for most other manufacturers/models it is a separate charge. BMW, for instance, increased its destination fee for 2009 models.

Now, if Hyundai did offer the Genesis w/ the 3.3 engine and separate out the destination charge, and if commodity prices hadn’t risen as much as they have, Hyundai very well might have been able to offer an entry level Genesis for a sub-$30k price.

I think that it was a smart move for Hyundai not to offer the smaller V-6. A Genesis w/ such an engine would do away w/ the image that Hyundai is trying set for the Genesis here in the States – that it is a “premium” vehicle priced substantially below models from the “luxury” makes.

While BMW and MB are able to get away w/ offering a 5 series or E class w/ relatively weak engines (since the brand name trumps the actually performance of, say, a 525i), a Genesis that does 0-60 in 7.5+ seconds isn’t exactly something that Hyundai can crow about.

Furthermore, a sub-$30k pricing would, imo, hurt the image of the Genesis as an entry-luxury model. Large/mid-sized sedans that sell in the high $20ks such as the Avalon or Maxima aren’t entry-luxury but near-luxury models. $30k is beginning price-point for entry-luxury models.

If commodity prices fall sharply and the Won drops further, I’d rather see Hyundai add a few more items to the base model than see the price drop below the $30k mark (not likely to see that happen regardless) or just have Hyundai and the dealers willing to make more “deals” on the Genesis.

 

[Sonata2009]

Well stated with a logic that makes sense . . .

 

[Sal Collaziano]

As far as I'm concerned, the price increase is so insignificant - that I don't even waste my time talking about it or replying to discussions about it (besides this one ).

Prices go up on all things all the time.. Who cares?

 

[DanTheMan]

As far as I'm concerned, the price increase is so insignificant - that I don't even waste my time talking about it or replying to discussions about it (besides this one ).

Prices go up and all things all the time.. Who cares?

Excellent point! If we were all so concerned about price increases...like gas, for instance...this forum would be about Hyundai Elantras instead!

 

[Simonwpb]

I was not aware of the Genesis when the original preliminary pricing was stated, so I cannot hold that against them.

The bottom line is when I did shop for a car, I found the Genesis to be the best value for the money. Hyundai's challenge is to convince 50,000 Americans a year to make the same conclusion...

 

[mkaresh]

Well, just 20,000 for the sedan. The other 30,000 are for the coupe.

I wouldn't think this would be so hard, except that Infiniti only sells about 18,000 M sedans a year the last time I checked. That's a comparable car, from a known premium brand, and that has won many comparison tests. And until the Hyundai came along it was the least expensive car in the class. So selling 20,000 won't be easy, even with all of the positive reviews the sedan is getting.

 

[Simonwpb]

Well, just 20,000 for the sedan. The other 30,000 are for the coupe.

I wouldn't think this would be so hard, except that Infiniti only sells about 18,000 M sedans a year the last time I checked. That's a comparable car, from a known premium brand, and that has won many comparison tests. And until the Hyundai came along it was the least expensive car in the class. So selling 20,000 won't be easy, even with all of the positive reviews the sedan is getting.

Can't wait to see what the August retail numbers are... I think they may get close to 2,000 for the month. September will be a better barometer for forecasting because the advertising campaign will have kicked in.

 

[YEH]

I wouldn't think this would be so hard, except that Infiniti only sells about 18,000 M sedans a year the last time I checked. That's a comparable car, from a known premium brand, and that has won many comparison tests. And until the Hyundai came along it was the least expensive car in the class. So selling 20,000 won't be easy, even with all of the positive reviews the sedan is getting.

20k won't be easy, but remember, the Genesis, while more similar to the M in size, is at the same price-point of the G35 and the G35 in 2007 sold over 70k units.

Also keep in mind that the Gen has more power than the M and at the same time, better fuel economy.

 

[Simonwpb]

I think 20,000 Genesis sedans a year is way too low! Last year they sold more Azeras than that. We all know the Genesis can do better than the Azera.

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[Michael_S]

Prices go up on all things all the time.. Who cares?

EDIT I decided to rewrite my post.

Well, the base price went up. For the people intending to purchase a moderately optioned Genesis, it's not a problem. The $33,000 Genesis, the $38,000 Genesis, and the loaded V8 $43,000 Genesis each represent a screaming deal in the entry-level large luxury car segment.

But for someone looking to spend $30,000 on a nice large sedan, the Hyundai just put the Genesis out of consideration. The Azera isn't a bad car by any stretch, but I think many people would prefer a stripped $30,000 Genesis over a loaded Azera.

 

[John M]

Comparing sticker prices, a loaded Azera is $30k. You can walk out the door with one for $27k with the right dealer. That's when it's an excellent bargain, and that's before you add the cash back and other offers available now.

The Azera is an excellent car. Sure, styling is subjective, but at least it isn't a cookie cutter car. It's got plenty of room (I'm 6' 2", 290 lbs) - even for my size 15 1/2 shoes. It has more usable space than a Grand Marquis / Town Car. It's plenty quick, and my mother is able to eek out 28 mpg on the highway. I'm sure it'd be a bit less with my driving.

Sure, everyone in my family who has an Azera now says they would prefer the Genesis, but after considering the $5k+ price difference, the Azera still makes a compelling argument for those with a hard $30k budget. Without such a positive ownership experience with the Azera, the Genesis would be a lot harder to sell in our family. Thanks to that car, it's a no-brainer and we'll be "adopting" Genesis' as each owner gets ready to trade.

 

[Michael_S]

John M,
I sat in an Azera, and I was definitely impressed with it. And I don't care about front wheel drive versus rear wheel drive.

But the Azera crash ratings are 4/4/5/5 stars from the US government and Good front offset, Acceptable side SUV crash, and Acceptable rear head restraint crash ratings from the Insurance Institute of Highway Safety (IIHS).

Those are pretty good ratings. But a few competitors do better.

The IIHS hasn't tested the Genesis yet, but it has 5/5/5/5 from the US government and a larger cabin than the Azera too.

 

[mkaresh]

I was far more impressed by the Genesis than the Azera. Totally different classes of car. I haven't driven an Azera recently, though. I know they've changed the suspension tuning; I didn't care for the handling or the ride with the earlier tuning.

 

[YEH]

For those who don't like the styling of the Azera (it looks better in person, but the front is still a bit bland), a cheaper alternative to the Genesis may be the Azera-based Kia VG (putting aside the whole FWD vs. RWD thing).

If the VG looks anything like the artist's rendering, it's a pretty handsome-looking sedan.

http://www.kia-world.net/index.php/2008/09/02/rendering-of-the-2010-kia-vg/#more-2431

 

[Michael_S]

YEH,
That artist rendering isn't much of a photo. But I had heard that the Amanti would be refreshed or replaced in a year or two.

I had not heard that it would be refreshed or replaced with a next generation of the Azera platform. I thought it was getting moved to the current Azera platform, which as I mentioned above is quite competent but lacks the crash safety perfect scores I want.

 

[YEH]

Michael, the rendering is based on the spy shots of the VG.

http://www.leftlanenews.com/kia-vg.html

Correction: According to some sources, it appears that the VG is to be a tweener btwn the Optima and the Amanti replacement - but there are contradicting reports so that remains to be seen.

There is talk about Kia doing its own version off the Genesis platform but that is just speculation for now.

And as for the safety ratings, that remains to be seen (platforms don't have as much to do w/ safety scores as does the strength of the body, placement of air bags, strengthening bars, etc. - which I'm sure will be improved upon from the Azera).

Note: the VG is based on a NEW platform and the one that the new Azera is to be based on as well.

 

[Sal Collaziano]

The Kia VG rendering does look interesting.. Here's a picture for anyone who doesn't care to click the link...

 

[DanTheMan]

John M,
I sat in an Azera, and I was definitely impressed with it. And I don't care about front wheel drive versus rear wheel drive.

But the Azera crash ratings are 4/4/5/5 stars from the US government and Good front offset, Acceptable side SUV crash, and Acceptable rear head restraint crash ratings from the Insurance Institute of Highway Safety (IIHS).

Those are pretty good ratings. But a few competitors do better.

The IIHS hasn't tested the Genesis yet, but it has 5/5/5/5 from the US government and a larger cabin than the Azera too.

I traded an Azera ('07 model) on my Genesis. I really liked that car. I bought it after being beside one at a traffic light. Even though it was dark outside when I saw it, I saw enough to make me want to investigate more. After some troubles with the Mazda Millenia that I'd owned for many years, I found one I liked and bought it. It was partly due to my great experience with the Azera that brought me to the Genesis. Although I enjoyed the Azera, I really enjoy the Genesis. As far as safety ratings, etc., are concerned, I wouldn't expect that there is enough 'real-world' difference in "near-top" levels as compared to the highest level/rate. By 'real-world' I mean if you are actually in a major car accident where you hit (or are hit by) someone at a substantial rate of speed at point of impact. It reminds me of the days when car manufacturers were so concerned about their "3-mile-an-hour" bumper! Who has a wreck at 3 mph???

All told, after my Azera experience, I would buy one of those again. Any future upgrades that Hyundai makes to that car can only make a great car even better.

Dan

 

[Michael_S]

YEH,
I'm hoping that last link you provided was for a purposely-dumbed down version of the sedan. Those concept renderings earlier were pretty nice looking. Those spy shots showed a pretty boring vehicle.

But of course, styling isn't really that important.

Dan,
You're right that the differences are probably not that huge between a 4 and 5 star rating and between "Good" and "Acceptable" from the IIHS.

But several automakers have models out with perfect scores on all crash tests. So if it's not too difficult to get something that good, why not get it?