By on September 22, 2017

2018 Genesis G70 lineup - Image: GenesisFirst, Hyundai wanted American consumers to accept the XG300 as a luxury car alternative. If two decades ago such an idea seemed ludicrous, the XG300 — later the XG350 and then the Azera — set the stage for 2018, a year in which a Hyundai luxury spinoff, Genesis, would complete its luxury sedan lineup.

Yes, complete.

Genesis Motors launched in the United States one year ago with the full-size G90 sedan (the Hyundai Equus in a prior generation) and midsize G80 sedan (renamed from the Hyundai Genesis). In September 2017, we saw the production version of the BMW 3 Series-rivalling Genesis G70, set to arrive in showrooms this winter.

Yet while there will be more vehicles from Genesis, including SUVs and quite likely a coupe, Genesis senior vice president Manfred Fitzgerald says the sedan lineup is complete. The fledgling brand will not be moving downmarket into the CLA250/A3/CT200h arena.

For the sake of Genesis Motors’ luxury aspirations, that’s a good thing. Speaking to CarAdvice at the launch of the G70 in Seoul, Manfred Fitzgerald told the Aussie publication, “We have a pretty clear strategy planned out with what we want to do. Therefore the sedan line-up is pretty complete with the G90, G80 and G70.”

Fitzgerald told Car And Driver that, rather than looking four or five years down the road, he looks five or ten years into the future and hopes to get to a place where “Made in Korea” is established with a premium orientation. To do so, the brand would be poorly served by the kind of downmarket push that can reflect poorly even on storied brands.

“Going lower than that [G70], like the others are — I don’t think that is in our playbook,” Fitzgerald says. “Other brands, due to their history and where they’re going from where they are, they might think otherwise.”

In other words, Mercedes-Benz’s S-Class, AMG GT, SL-Class, GLS-Class, and numerous other models have secured the brand’s premium image, affording them the opportunity to stretch the brand’s parameters. As for Genesis’ operations in the U.S., Fitzgerald says, “We’re nowhere in terms of awareness.”

The brand boss is still happy to see the sales results achieved by the G80 and G90, particularly in the context of that awareness gap. 20,314 Genesis G80/G90 sedans have been sold in America since August 2016, a tiny number compared with the 27,000 cars and SUVs sold by Mercedes-Benz USA every month, but a number that lacks a measure of relevance until Genesis has its own network.

Already, you’ll recall, those plans are in flux. Only months after the first Genesis sales, the brand’s U.S. boss, Erwin Raphael, revealed his feelings about the dealer network.

It was too large.

More recently, Raphael revealed plans to adjust the brand’s dealer plans sooner and more thoroughly than previously expected. This whole G80-beside-an-Accent methodology ain’t ideal. A $29,999 Genesis G60 posing as a luxury car wouldn’t the brand any favors, either.

[Images: Genesis Motors]

Timothy Cain is a contributing analyst at The Truth About Cars and Autofocus.ca and the founder and former editor of GoodCarBadCar.net. Follow on Twitter @timcaincars and Instagram.

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67 Comments on “Wisely, Hyundai’s Genesis Brand Will Not Move Any Further Downmarket...”


  • avatar
    ash78

    Hold on a second and read this sentence a couple times:

    “Mercedes is consistently pushing downmarket in the US and Hyundai refuses to follow suit.”

    Yeah, I’m pretty sure that the world is ending tomorrow.

    • 0 avatar
      28-Cars-Later

      Genesis’ parent company already has lesser product to sell for volume, Mercedes does not historically. I suspect though when enough CLAs become ghetto fabulous’d Daimler may regret the cheapening of Mercedes.

      • 0 avatar
        S2k Chris

        “I suspect thought when enough CLAs become ghetto fabulous’d”

        When? With a light-up emblem out front, they come that way from the factory.

      • 0 avatar
        ash78

        I haven’t seen a CLA yet that wasn’t modded (or dealer-installed accessorized) to some obnoxious degree. I just feel bad for all the real hardworking C-class owners who are now being visually aped by CLA lessees on their way to their 4-hour Starbucks shift so mom will get off their backs about spending so much time at the gym and the club and never mowing the damned lawn to help contribute to the family.

        • 0 avatar
          28-Cars-Later

          Nice commentary but personally I’m not sending the gf/wife out to mow the lawn as part of a family contribution. Her skills are better suited in my home.

          • 0 avatar
            ash78

            Wait, you’ve seen someone over the age of 20 driving a CLA? :P

          • 0 avatar
            28-Cars-Later

            @ash

            I try to avert my eyes when encountering one in my field of vision, but I have seen at least two elderly/boomer age people get into them in parking lots. Can’t speak for the core demo (whatever it is supposed to be).

        • 0 avatar
          I_like_stuff

          “I haven’t seen a CLA yet that wasn’t modded (or dealer-installed accessorized) to some obnoxious degree. I just feel bad for all the real hardworking C-class owners who are now being visually aped by CLA lessees on their way to their 4-hour Starbucks shift so mom will get off their backs about spending so much time at the gym and the club and never mowing the damned lawn to help contribute to the family.”

          What?

        • 0 avatar
          bd2

          Eh, how’s that any worse than S Class owners being “visually-aped” by cheap C Class lessees?

          Not to mention all those blue-collar plumbers, electricians, etc. driving around in a tri-star adorned work van? Gasp! The horror!

          And in Europe. it’s even worse with all those tri-star adorned GARBAGE trucks running around and yet, the Europeans seem to be able to endure it.

          Also, hardly the first time Mercedes has been doing the bargain-basement thing.

          Remember the C200 Kompressor?
          And over in Canada, they had the econobox B Class.

          • 0 avatar
            28-Cars-Later

            I’m not European but I don’t think Mercedes was ever viewed the same way it was Stateside. Here it was crème de la crème with only the likes of RR/Bentley and perhaps Jaguar/LR being “above” in hierarchy.

            “Remember the C200 Kompressor?”

            I do, and I don’t remember it being successful in USDM.

      • 0 avatar

        Too Late ! Pull right up next to the e46 with Ling Long tires….

  • avatar
    tallguy130

    The better question is: what will Genesis bring to the table to stand out from the other luxury brands? (Price, performance, reliability, efficiency?) What’s the hook to pull people away from an already pretty crowded luxury market?

    • 0 avatar
      ash78

      To borrow from Mr. Regular and Jagvar: “Stealth Wealth”

      It’s a thing now. Before the Great Recession, it wasn’t really (witness the failures of the XG350, Phaeton, Azera, and other upmarket offerings from plebian brands)

      • 0 avatar
        PrincipalDan

        I don’t know if I’d throw the XG350 and Azera in there. They were nice Buick competitors not threats to Lexus and Mercedes.

        Irony however would be if Genesis sedans outsell Cadillac sedans.

        • 0 avatar
          bd2

          Yep, the XG350 and Azera are “premium,” not luxury.

          And even if one argues that the Lexus ES falls more on the premium than luxury scale, Hyundai’s version of that was the Aslan (which flopped).

      • 0 avatar
        S2k Chris

        Why will “stealth wealth” buy an upscale unknown Korean brand, when they can do what they’ve always done and buy perfectly good top-line Accords, Camrys, Grand Cherokees, Tahoes, and 4Runners? Or loaded pickups?

        • 0 avatar
          ash78

          There’s definitely a notch above what you’re describing — people who want a nice car AND something unique and different…but not obnoxious. They’re one percenters but want to look like ten percenters. Not fifty percenters :D

          • 0 avatar
            S2k Chris

            I mean, you’re carving up the market into pretty small niches here. Are there really that many people who think “ohh, a low end MB or BMW is too fancy, and a Honda Accord or Camry isn’t fancy enough, and an Acura and an Infiniti and a Lexus and a Volvo are wrong, I need a new brand from Hyundai!”?

            Personally, I’ve always figured Genesis sales were driven primarily by affluent and patriotic Korean-Americans who were glad they no longer had to buy Japanese. I mean, that’s probably a bigger demographic than the one you stated.

        • 0 avatar
          bd2

          @S2k

          And you would be mistaken.

          The vast majority of Genesis buyers have been white and male.

          Korean-Americans tend to purchase German and then Lexus (they certainly have no problem buying Japanese as Toyota and Honda are 2 of the most popular brands).

          And Genesis seems to be doing alright in carving out a niche for itself – battling the A6 for the 3rd spot in the midsize segment and outselling the others by multiples.

      • 0 avatar
        mmreeses

        “stealth wealth” is a winner strategy for you/your kids/your marriage.

        it’s a loser strategy if you’re a CEO wanting to bank profits.

        My sister-in-law’s dad is 100% Costco “stealth wealth” and he drives a Pathfinder Titanium. I mean platinum.

        Infiniti? Acura? now add Genesis. why spend the extra money for a “stealth wealth badge” when Titanium/Platinum/etc. are pretty good if you’re not a badge snob or petrolhead.

        There is a narrow opening in the market for a reliable full-size lux SUV priced like it’s one class lower, with more tech and horsepower. But Genesis decided to go the car route as the SUV craze hasn’t hit Asia as much as it has in the USA

        Fan of the Genesis cars themselves, but the marketing roll-out, dealer roll-out and lack of SUVs have really handicapped the brand. Probably for years to come.

      • 0 avatar
        romanjetfighter

        genesis brand is the opposite of stealth wealth. it’s pretentious without the cost or pedigree. lot so of chrome, apes the style and look of expensive cars.

        not very stealthy.

        like yukon denali with 22 chrome wheels and that huge grille. lol

    • 0 avatar
      TMA1

      They look better. Korea’s a conservative country, and their cars reflect that. The Japanese have totally lost it, styling-wise. Even BMW and MB are getting a bit blobby. Only Genesis and Audi are putting out clean designs. Not a surprise, given the shared history of their design crews.

      There’s also more value for your money. Hyundai isn’t going to make you feel cheated with pricing and packaging schemes to get features that are standard in a Sonata.

      • 0 avatar
        S2k Chris

        “They look better.”

        Seriously? The latest Genesis looks darn near IDENTICAL to an Infiniti G50.

        “There’s also more value for your money. Hyundai isn’t going to make you feel cheated with pricing and packaging schemes to get features that are standard in a Sonata.”

        On one hand yes (Acura pulls that BS) but on the other hand the theoretical prices I’ve seen are significantly higher than I’d expect, a very small discount from a 3-series. No one wants a Genesis that’s $3k cheaper than a 335i, especially when it leases the same OR WORSE. Someone’s gotta save real money, like $10k, to chose a Genesis over a 3-series.

        • 0 avatar
          TMA1

          The Q50? I really don’t see any resemblance at all between anything from Infiniti and Genesis. And aside from the Q50/60, everything from Infiniti seems to be at least 10 years old.

          A 340 (aka 335 a few years ago) starts at $49K. At that price, you’re still not getting heated seats or navigation. Though I think they’ve finally thrown in bluetooth. How kind of them.

          A G80 starts $42K, with a long list of features that embarrasses the Germans. Any packages on top of that are full of stuff you won’t get in a 340 at any price, and this in a car that competes one class larger. A $G70 will start significantly lower.

          I don’t know how the leases will work out, but I think a $10K gap between a G80 and a 340 would be pretty common. It’s only going to get larger when the G70 is the basis of comparison.

        • 0 avatar
          bd2

          Not at all.

      • 0 avatar
        xtoyota

        That’s why I drive a AWD G80 Genesis….Best car I have ever owned…and NO warranty problems

    • 0 avatar
      ajla

      “what will Genesis bring to the table to stand out from the other luxury brands?”

      If I buy a Genesis it will 100% be for the 5.0L. Getting a V8 from the other luxury brands costs nearly $100K and getting a naturally-aspirated V8 in a large-ish car is almost impossible now.

    • 0 avatar
      JEFFSHADOW

      Decisions are so easy for Dr. Oldsmobile…
      I will NEVER buy Korean Kr*p!

  • avatar
    28-Cars-Later

    ““Made in Korea” is established with a premium orientation.”

    Humans are such silly creatures. If you want “Korean” to be taken seriously as “Japanese” was in the early 1980s, then everything coming out of your country has to be a notch above the competition in it’s respective classes. Even If Genesis was, Hyundai/Kia are not, as that competition includes established Japanese marques. Japan Inc was at its peak when Acura and Lexus were launched, and slowly though many years of superior product they were able to win over domestic and foreign luxury car buyers. Korea Inc is not at the point where a buyer chooses its lesser marques over Toyonda and until it is, I don’t think many luxury buyers will take Genesis seriously. Similar to how Cadillac is the “store brand” [old] BMW, Genesis may be considered the “store brand” Infiniti.

    “Fitzgerald says, “We’re nowhere in terms of awareness.””

    Where you will likely remain. Drop the “Korea” thing because I don’t think you will ever beat Japan’s marques, view Genesis as “different” somehow and differentiate it from “m’eh” Hyundai.

    • 0 avatar
      pmirp1

      I used to think no one could top the Japanese in TVs and electronics. Remember brands like Sony and Toshiba and Panasonic and Sanyo and … ruled. Now not so much. Koreans took over that market and product line and Samsung and LG now rule.

      The work ethic of Koreans now reminds me of Japanese work ethic of 60s and 70s.

      And Kia and Hyundai have improved considerably in last 10 years.

      • 0 avatar
        S2k Chris

        “Remember brands like Sony and Toshiba and Panasonic and Sanyo and … ruled. Now not so much. Koreans took over that market and product line and Samsung and LG now rule.”

        Do they? I still think of Sonys as slightly nicer than the equivalent Samsung, and bought accordingly for my last TV (mid-priced 55″ Sony Bravia XBR). I thought of Samsung as a more high-volume slightly lower-quality brand. LG didn’t even register.

        • 0 avatar
          nels0300

          Not just TVs either, Samsung and LG are major players in cell phones and Japan is pretty much nowhere to be found, at least here in the US.

          Although, I’m not sure how much of a parallel you can draw between electronics and auto manufacturing.

        • 0 avatar
          nels0300

          LG and Samsung both made OLED TVs before Sony.

        • 0 avatar
          bd2

          Nope – Samsung rules the TV roost.

          Heck, Sony didn’t even make their own LED panels and had to sources them from others, including Samsung.

          • 0 avatar

            The last Sony TV set I liked was a 34 inch CRT. Since then, not so much. The Panasonic plasma was the best for a while, other than the Kuro, and now, even the LCD sets have improved quite a bit. When the plasma goes, then it will be OLED, and pretty much at the same price point of the plasma when it was new….

            Much like cars, there isn’t much need to upgrade unless the current item stops working. It’s nice that there is 4k, but for now, everything is 1080 or 720 with some legacy 480…so a pixel for pixel 1080p panel is as good as you are going to get 99% of the time.

        • 0 avatar
          tekdemon

          The very highest end Sony TVs actually use LG OLED panels-the XBR-A1Es are all LG panels with Sony making only the other electronics. And similarly a lot of Sony panels are sourced from LG. Pretty silly to say that LG doesn’t register when LG panels underpin Sony’s best TVs. But if more people were aware of this Sony probably wouldn’t have as much business as it does. They do provide better upscaling and whatnot for lower resolution sources though, so if you watch a lot of older DVDs or cable tv you might still benefit.

          That said, I think it’ll be a while before Hyundai and Kia are up to that level vs the competition.

          LG’s real weaknesses are in software these days.

      • 0 avatar
        TMA1

        One of the things I like about the Korean automakers is that they’re driven to be better and better, and they are with every generation. There’s still a lot of animosity against the Japanese, and they’re still very driven to catch and surpass them.

        Which I think they did, with their consumer electronics. Which I don’t think receive the after-purchase support and upgrades that are necessary to be a top-notch product. But they’ve mostly vanquished the Japanese competition. With that incentive gone, I think innovation and quality takes a downturn.

      • 0 avatar
        aquaticko

        The question in my mind is if Korea’s current, 60’s/70’s Japan echo will be followed by an 80’s/90’s Japan echo. That era of Japan’s history is when almost all of the stuff that defines Japan as it is in our popular imagination–relentlessly innovative and boundary-pushing, perfectly combining the unique aspects of its past with a real passion for the future–came about. As is the case for all particular ideas about generalized things, it doesn’t matter if those descriptors still apply to the subject; Japan still benefits from its 80’s and 90’s like France and Italy (and the U.S.) do from their 50’s/60’s.

        Not just Genesis, not just Hyundai, not just Samsung or LG, but all of Korea’s industry needs that kind of image boost, otherwise China will do to Korea’s mainstream what Korea did to Japan’s (electronics industry) in the 00’s. Follow the profit margins; move upmarket, or die.

      • 0 avatar
        Lynchenstein

        The Hyundai dealer experience leaves a LOT to be desired. Here in Victoria, BC, they act like a group of frat bros. The Kia dealer is leaps and bounds better, but definitely lacking in the “premium” feels.

      • 0 avatar
        28-Cars-Later

        @pmirp1

        I’m not up on television electronics but do agree I see many LG and Samsung branded products. Sony et al itself builds much of its product in PRC now so even they have come down a notch in terms of assembly location and perhaps build quality. My 90s grade Sony speakers say made in Japan but my 2005 Sony receiver/speakers are marked made in Malaysia. I will say this, I have had zero issues with my 2010 period Sharp Aquos LCD TV so perhaps the world of electronics mfg has shrunk to the point where assembly point and suppliers do not matter, but I still believe automobiles are more complicated and such logic still applies to them.

        “work ethic of Koreans now reminds me of Japanese work ethic of 60s and 70s.”

        I’m just curious, have you traveled and see this firsthand? I have no travel exposure to Asia myself as of yet.

        “Kia and Hyundai have improved considerably in last 10 years.”

        I agree, however they had nowhere to go but up. In the early 2000s KIA was literally a punchline and Hyundai, well, I don’t really recall perception. Value, maybe? Then perhaps it was equated with second tier Japanese. I really don’t remember. I do know when I still worked wholesale in this period the only Hyundai we were ever interested in was Santa Fe, and I don’t recall us keeping anything else from the marque on the lot long. Despite improvements, I personally believe their products are still mostly designed for warranty period only. I would be seeing different figures for the previous Hyundai Genesis and Kia U-boat if suddenly they were 21st Century Lexus. The street always knows first.

        @Chris

        I have similar views but perhaps we’re out of date?

        @nels

        “Samsung and LG are major players in cell phones and Japan is pretty much nowhere to be found, at least here in the US.”

        This is a great point, as Samsung is a major player in the touchscreen “phone” arena. I don’t know enough about those products to know what if any the Japanese contribution is/was.

        “LG and Samsung both made OLED TVs before Sony.”

        Not a big fan of LED vs LCD, though I do have a slight anecdote to share. In summer 2003 when I was still in college and a caddy at St Clair CC, I once worked a round with a recently retired PPG executive whose name I no longer can recall. At the time, the plasma television was all the rage and we briefly discussed it. He quipped, that’s old technology, I saw that in the lab fifteen years ago. Makes me wonder what other “old tech” is still coming on the horizon.

        EDIT: Interesting history.

        “The monochrome plasma video display was co-invented in 1964 at the University of Illinois at Urbana-Champaign by Donald Bitzer, H. Gene Slottow, and graduate student Robert Willson for the PLATO Computer System.[50] The original neon orange monochrome Digivue display panels built by glass producer Owens-Illinois were very popular in the early 1970s because they were rugged and needed neither memory nor circuitry to refresh the images. A long period of sales decline occurred in the late 1970s because semiconductor memory made CRT displays cheaper than the 2500 USD 512 x 512 PLATO plasma displays.[citation needed] Nonetheless, the plasma displays’ relatively large screen size and 1 inch thickness made them suitable for high-profile placement in lobbies and stock exchanges.”

        en.wikipedia.org/wiki/Plasma_display

  • avatar
    PrincipalDan

    Good Luck Genesis.

    Selling sedans is swimming upstream to start with.

  • avatar
    Speed3

    This is great. New competition from Jaguar, Alfa Romeo, and Hyundai. It’s a crowded market place and not every manufacturer is going to do well, but its a great time to be in the market for an entry level luxury sedan.

  • avatar
    kmars2009

    I own a XG350L. It’s been reliable and solid. I think the Genesis brand is doing it right. The G90 might be my next car.

  • avatar
    Rocket

    Smart strategy. And honorable to resist chasing others to the bottom. Opinions clearly vary greatly on the subject of Genesis’ current standing in the market, but I think they’re already ahead of the Japanese. Yes – ALL the Japanese. Acura can barely compete with its mainstream sister brand. Infiniti has increased the style factor, but they’re relying more on FWD architecture and dreaded CVT’s. And do I need to even say anything about Lexus’ styling?

    The GV80 is the model I’m waiting for. With the recent death of the QX70, it will be the only RWD non-European luxury crossover. If Genesis screws it up, it could be their undoing. It can’t be emphasized enough how critical it is to the future of the brand.

  • avatar
    kmars2009

    It’s unfortunate the current Azera/Grandeur has been discontinued for the US market. It isn’t a bad car…just unwanted, in a shrinking near luxury sedan segment. I believe the Toyota Avalon might be chooped next.

    • 0 avatar
      TMA1

      I was just in Seoul last week. The new Grandeur is a handsome car. Koreans are still buying sedans. But in general, I think they like to present themselves better than Americans. A sedan is like a nice suit, whereas a CUV is a pair of sweatpants with worn out elastic. Koreans and Americans tend to present themselves respectively. Whether it costs $300 or $3,000, the suit is going to look better than a pair of designer sweatpants.

      At least the new K7 is here. Also a handsome car, that will unfortunately have a hard time finding buyers.

    • 0 avatar
      ash78

      A guy at my church (high-level accountant type) drives a new Azera and I was actually really impressed with it. The older ones were sort of “placeholders” for the eventual Sonata revamp, but the last couple years have been surprisingly nice. I’d take one all day over an Avalon. Or anything from Acura.

  • avatar
    I_like_stuff

    I test drove the G80 this summer. Really liked it. However, the mrs. was not about to spend $50K on a Hyundai. The reason she said this was because we had to go to a Hyundai dealership to test drive said $50K car. Until Genesis has its own network of dealerships, this will happen over and over.

  • avatar
    jonjon72

    Glad to see Genesis is will to accept that they don’t have the pedigree to compete in certain markets.

    Unlike the Japanese who entered the luxury car market when the Germans quality was suspect at best, Korea comes in when the competition is running on all cylinders. They have a bigger battle but have made the right moves bringing in some very talented people to get this brand going.

    Personally I’ll always root for the underdog. Especially when some of these established brands have become lazy with their products.

  • avatar
    bd2

    Well, with the Genesis brand, Hyundai wanted to keep it RWD-centric.

    But that was before the addition of a 3rd crossover model which will slot beneath the GV70 (the CUV that will share its platform with the G70).

    Would be difficult for Genesis to keep this smaller CUV RWD-based, esp. as the Germans don’t even do it, much less the Japanese (really, no need for a smaller sedan than the G70 as long as there is going to be a smaller CUV).

  • avatar
    bd2

    Anyhow, the first reviews of the (KDM) G70 are out and they’re pretty positive.

    The US spec version should be even better and the Aussie-spec even better than the US version.

  • avatar
    JerseyRon

    The Hyundai dealership in my county is housed in a small building that fits only two vehicles. The time I was there, they had an Elantra and an Accent inside. They don’t have an on-site service department. Hyundai buyers take their vehicles to the Mazda dealership (with same ownership) a couple of miles down the highway.
    Such a setting cannot compare to the experience provided at a Lexus dealership.


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