Ward's obtains Hyundai doc detailing plan to split off luxury cars in dealerships

[Sal Collaziano]

Filed under: Etc., Marketing/Advertising, Hyundai, Luxury

2010 Hyundai Equus - Click above for high-res image gallery​

Before the Hyundai Genesis arrived in showrooms, there was talk of the car launching under the aegis of it own brand, much like the debut of the Lexus LS400 back in 1990. That didn't happen, and premium Hyundais like the Genesis and the forthcoming 2010 Equus share floor space with Accents and Sportages.

Still, the thought of a roped-off premium car department has a pull. "Sectioning off the brand, that's the Holy Grail," said Hyundai Motors USA CEO John Krafcik to Ward's Auto. What Krafcik and his HMUSA masters may have up their collective sleeve is a way to get some of the desired differentiation without the massive costs a new brand launch would entail.

Dave Zuchowski, Hyundai's North American sales vice president, has drawn parallels to Toyota's co-locating efforts with its Scion sub-brand in a letter to dealers, laying out the plans for incorporating the Equus into showrooms. "This strategy will create physical and psychological separation in the Hyundai Showroom," says Zuchowski, while dealers remain less convinced that this means anything more for them than increased costs. On the retail end, stores will be required to purchase several kits for showroom, service, and parts support of the Equus. While not as expensive as a full-blown new store would be, dealers still might have trouble mustering enthusiasm for hundreds of thousands of dollars of corporate-ordered directives that franchisees must comply with.

Dealer unhappiness aside, Zuchowski lays out Hyundai's strategy clearly. "We intend to use the launch of the new Equus to develop and further establish Hyundai as a legitimate force in the premium-luxury segments;" intimating there might be more to it than just the Genesis models and the luxo-liner Equus - a "Genesised-up" Santa Fe might do battle against the Lexus RX, for instance. While it will cost dealers money, Zuchowski notes that ultimately, it's the cheapest way to go while "still providing an enhanced dealership environment...that will devliver a substantial incremental profit oportunity with very reasonable dealer investment." In other words, pay the man now, and cash in later, if all goes well.


Gallery: Quick Spin: Hyundai Equus



[Source: Ward's Auto]Ward's obtains Hyundai doc detailing plan to split off luxury cars in dealerships originally appeared on Autoblog on Sat, 02 Jan 2010 09:55:00 EST. Please see our terms for use of feeds.



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[GripperDon]

They need to "Rope Off" The Hyundai "Ignore problems with the Genesis" attitude. and start caring about the existing customers before they can think that "Word of mouth" will not eventually bite them where it hurts. And that will take more than a velvet rope or wall to fix.

 

[mongo]

Thankfully I haven't had any problems with my genesis, but none of the dealerships that I visited when shopping for one came close to "nice". And the one that was closest to "nice" was actually quite apathetic towards the genesis.

Hyundai should understand that the number one problem with their upscale cars is the basic "hyundai" stigma. Doesn't matter if it's warranted or not, it exists. And who has overcome the stigma? People that plunked down cash for the Genesis.

Based upon that I'd venture that the first folk to warm to the Equus will be existing genesis owners.

 

[Seattle Genesis]

I agree with you, Don.. Also all the Hyundai dealerships I have visited are all dumps. No luxury amenities anywhere to be seen.
Seattle Genesis

 

[Monandy]

Filed under: Etc., Marketing/Advertising, Hyundai, Luxury

2010 Hyundai Equus - Click above for high-res image gallery​

Before the Hyundai Genesis arrived in showrooms, there was talk of the car launching under the aegis of it own brand, much like the debut of the Lexus LS400 back in 1990. That didn't happen, and premium Hyundais like the Genesis and the forthcoming 2010 Equus share floor space with Accents and Sportages.

Still, the thought of a roped-off premium car department has a pull. "Sectioning off the brand, that's the Holy Grail," said Hyundai Motors USA CEO John Krafcik to Ward's Auto. What Krafcik and his HMUSA masters may have up their collective sleeve is a way to get some of the desired differentiation without the massive costs a new brand launch would entail.

Dave Zuchowski, Hyundai's North American sales vice president, has drawn parallels to Toyota's co-locating efforts with its Scion sub-brand in a letter to dealers, laying out the plans for incorporating the Equus into showrooms. "This strategy will create physical and psychological separation in the Hyundai Showroom," says Zuchowski, while dealers remain less convinced that this means anything more for them than increased costs. On the retail end, stores will be required to purchase several kits for showroom, service, and parts support of the Equus. While not as expensive as a full-blown new store would be, dealers still might have trouble mustering enthusiasm for hundreds of thousands of dollars of corporate-ordered directives that franchisees must comply with.

Dealer unhappiness aside, Zuchowski lays out Hyundai's strategy clearly. "We intend to use the launch of the new Equus to develop and further establish Hyundai as a legitimate force in the premium-luxury segments;" intimating there might be more to it than just the Genesis models and the luxo-liner Equus - a "Genesised-up" Santa Fe might do battle against the Lexus RX, for instance. While it will cost dealers money, Zuchowski notes that ultimately, it's the cheapest way to go while "still providing an enhanced dealership environment...that will devliver a substantial incremental profit oportunity with very reasonable dealer investment." In other words, pay the man now, and cash in later, if all goes well.


Gallery: Quick Spin: Hyundai Equus



[Source: Ward's Auto]Ward's obtains Hyundai doc detailing plan to split off luxury cars in dealerships originally appeared on Autoblog on Sat, 02 Jan 2010 09:55:00 EST. Please see our terms for use of feeds.



Read | Permalink | Email this | Comments

Read more...

Hyundai May Separate Genesis, Equus Models In Showrooms

The push to create a separate stand-alone brand for Hyundai's Genesis models seems to be nigh, as instructions to dealers call for a "showroom within a showroom" for its premium offerings.

Unlike Japanese automakers, which crafted new brands and dealer networks for premium models, Hyundai will continue to sell its top models in existing showrooms. According to internal memos obtained by Ward's Auto World, dealers will, however, have to offer separate floor space for Genesis models and the forthcoming Equus -- similar to how Scions are placed in most Toyota showrooms.

While some dealers question the timing of such a move, this strategy does seem to make the most sense. Hyundai can continue to build off the favorable press given to the Genesis line, and won't have to carry the tremendous cost of building a brand from scratch.

All Hyundai dealers are likely to sell Genesis models, but the Equus flagship -- which will likely be priced in the $60,000 range -- will only be sold through selected dealers. Stores interested in selling the sedan will be required to invest in specialized tools, parts inventories, and a "premium showroom kit."

Source: Ward's Auto World