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

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.

[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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187sks

Hmm, didn't even know Hyundai dealers sold Sportages. I swear, I should be an automotive journalist. At least I would know what cars are made by who.

Interesting concept, but I don't know how well it'll work. Sounds like the VIP section of a strip club. tongue.gif