Hyundai Motor Unveils New Genesis Sedan to Boost Sales in U.S.

0

Hyundai Motor Co. (005380), South Korea’s
largest automaker, unveiled a revamped all-wheel-drive Genesis
premium sedan today that will go on sale in the U.S. next year
to revive flagging sales in the model’s largest market.

The all-new Genesis, which competes with Bayerische Motoren
Werke AG’s 5-series and Daimler AG (DAI)’s Mercedes Benz E-Class in
the midsized premium sedan market, will also be introduced in
Europe next year, its first premium model in the market. Hyundai
plans to sell 62,000 Genesis sedans worldwide in 2014, the
Seoul-based company said in a statement today.

Hyundai’s first revamp of the Genesis, which won the North
American Car of the Year award in 2009, comes in the wake of a
series of recalls this year by Hyundai and its affiliate Kia
Motors Corp. (000270)
The recalls have been a blow to Hyundai, which has
striven for years to upgrade its image as a maker of cheap
utilitarian cars, and follow a rapid expansion of production in
new markets such as Brazil and China as it competes with Toyota
Motor Corp. (7203)

“The success of the last Genesis raised Hyundai’s profile
from a value-for-money carmaker to a premium car contender,”
said Shin Chung Kwan, an auto analyst at KB Investment
Securities Co. “Equipped with fresh looks and better contents
including an all-wheel-drive system, the new Genesis is set to
expand its market in the U.S. and help Hyundai win back market
share from its competitors.”

Car Recalls

The company invested 500 billion won ($472 million) in
developing the new car which comes with 3.8-liter and 5-liter
engine options, and features a roomier interior, new hexagonal
grille and in-car gadgets such as a head-up display, Hyundai
said. Its price in South Korea is set between 46.6 million won
($44,000) and 69.6 million won, according to the company.

First introduced in 2008, the Genesis’s revamp comes in the
wake of the recalls that led to the resignations of executives
including Kwon Moon Sik, the automaker’s chief technology
officer. More than 1.7 million vehicles in the U.S. have been
recalled, including the Genesis, for malfunctioning brake lights
and cruise control.

Earlier this year, Hyundai agreed to settle a group of
lawsuits by U.S. customers who said they were misled into buying
its vehicles because it overstated their fuel economy.

Following the recalls, the company has become more
stringent in quality checks for the new Genesis, said Park Joon Hong, a research fellow at Hyundai’s automotive research and
development division.

Lagged Behind

Hyundai’s sales in the U.S. have risen less than 2 percent
in the first 10 months of this year, versus the industry average
for 8 percent growth in the same period, according to data from
the company’s website.

As of end of October, 36 percent of all Genesis sedans,
which are made at the company’s plants in the southern Korean
city of Ulsan, were sold in the U.S. since 2008, according to
the company’s website. That’s 75 percent of all Genesis sedans
sold overseas.

Hyundai is targeting to increase U.S. sales by 10 percent
from this year’s target of 734,000 units, according to Ahn Young Jin, director and head of its U.S. operations.

Pre-orders for the Genesis that began on Nov. 19 are set to
exceed its predecessor’s monthly sales record of 5,288 units in
June 2008, after getting 5,200 orders before the price of the
model was even announced between Nov. 19 and 22, according to an
e-mailed statement from the company on Nov. 24.

The sedan will also be sold in countries including China
and the Middle East.

To contact the reporter on this story:
Rose Kim in Seoul at
rkim76@bloomberg.net

To contact the editor responsible for this story:
Young-Sam Cho at
ycho2@bloomberg.net

DrivePulse is your source for new car reviews, research, ratings, used car research and the latest industry automotive news. Connect and follow us today!

Comments are closed.