It’s a strange question to ask, considering that Hyundai is already selling the Genesis and Equus luxury sedans, but apparently Hyundai decided to bring out the cars before launching a brand. According to the Wall Street Journal
There are three branding scenarios under consideration. The most likely is to create a subbrand called “Genesis,” and sell the models under the same dealership roof as Hyundai but in a separate part of the showroom, possibly with dedicated salespeople, said John Krafcik, the president of Hyundai Motor America.
The other scenarios are to keep the premium cars badged as Hyundais, or—in the most ambitious move—spin off the brand into separate dealer facilities, much like Lexus or Honda Motor Co.’s Acura
Those are the options, but for a little more context, let’s check in with Hyundai USA boss John Krafcik…
The WSJ reports:
“One of the keys to this plan is how well the Equus does,” Mr. Krafcik said. “We don’t need to make a decision for some time” on the branding question.
Mr. Krafcik said he wants to be open to all options, but has some concerns about spinning off the brand. It would costs millions of dollars to create a new network of dealerships, adding pressure to increase sales for the brand and to raise prices.
He estimated separate dealerships would require the company to obtain about $6,000 more revenue per each car these outlets sold.
And the additional cost is just the beginning: Lexus and Infiniti would probably not have become the brands they are if their vehicles had been launched as Toyotas and Nissans before being re-branded. Bringing in a completely separate brand with bespoke dealers won’t have the same impact if the same cars are stalking the streets with Hyundai badges. On the other hand, if Hyundai does launch a 3 Series-fighter and a RX-style luxury crossover, it will need to do more in the way of becoming a luxury brand… or does it? Is the concept of luxury-style offerings from a value brand completely doomed to fail? Is a sub-brand really any better? Decisions, decisions…