By on January 31, 2018

Genesis G70

Hyundai Motor America and its U.S. Genesis division sent messages to Hyundai dealers this week, alerting them to the formation of an independent Genesis dealer network. Hyundai’s recently created luxury marque wants space between it and its value-focused sister division, and that means the need for standalone stores.

Shared showrooms simply won’t cut it anymore.

Right now, Genesis customers in the United States can purchase models at roughly 350 Hyundai dealers, but not for long. The plan calls for just 100 standalone stores as a starting point. If you’re a Hyundai dealer with dreams of selling a higher class of vehicles, this is your opportunity — but your chances of being selected might not be as high as those dealers already selling the brand.

According to Genesis, “certain dealers who are parties to the Genesis Participation Agreement (GPA), currently doing business in defined key markets, will be given the first opportunity to apply for the Genesis franchise.”

Dealers that signed on to the GPA agreed to set up Genesis showrooms inside their Hyundai store. Naturally, those locations get first dibs.

2017 Genesis G80 - Image: Genesis Motors

“At Genesis, we believe in putting our customers first and giving them a proper ownership experience,” said Erwin Raphael, General Manager of Genesis Motor America, in a statement. “To ensure that happens, we need to take this next step in the separation of the Genesis brand from our parent company.”

Establishing a “right-sized” dealer network is key for the brand’s long-term health, Raphael said.

Right now, you’ll only find two models under the Genesis banner — the midsize G80 (formerly the Hyundai Genesis) and full-size G90, both rear- or all-wheel-drive vehicles. A smaller G70 sedan arrives this year, with crucial crossovers in the pipe. Until a full (and diverse) lineup materializes in Genesis showrooms, the brand needs to proceed with caution. Sedans, especially those bearing a relatively unfamiliar badge, aren’t a guaranteed draw, especially in today’s market.

Genesis sales kicked off in late summer, 2016. Last year, some 20,594 Americans took home a Genesis-badged vehicle, with the bulk of those buyers choosing the G80. December 2017 was the best sales month thus far.

[Images: Genesis Motors]

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30 Comments on “Hyundai Dealers Put on Notice: It’s Time for Genesis, but Not Everyone Gets to Play...”


  • avatar
    sportyaccordy

    If I were a Hyundai dealer I wouldn’t want to deal with the hassle of Genesis anyway. Non-German luxury sedans are lot cancer. “Call me back when you have some crossovers *click*”

    • 0 avatar
      Jack Denver

      That’s fine. Genesis is shooting for a low # of dealers. If you are a Hyundai dealer and you say no now they are never going to ask you again. We know the crossovers are coming and Hyundai has long term plans to make Genesis an important luxury brand. But if you can’t see beyond this week then you won’t get to participate ever.

    • 0 avatar
      bd2

      The US launch of the G70 may be delayed until later in the year in order to give time for at least a portion of the planned Genesis dealerships to be built (some are already in the process of being constructed).

      The 1st Genesis CUV, the GV80, is due to launch early-mid next year.

  • avatar
    slavuta

    On Sunday I checked Genesis cars and I like them. Now, my local dealer sells them but I don’t see how they can make a separate showroom in there. They will have to do either
    – give up selling Genesis
    – Open up another store in the area
    – Move the whole operation to bigger lot, where they can have both

    Bonus: Kia selling right next door.

    • 0 avatar
      notwhoithink

      That is exactly the plan. They want Genesis dealers to be stand-alone stores, preferably not sharing lot space with Hyundai dealers. You might see a few mega-dealers (like Ricart in Columbus) pick up a Genesis store and be able to keep it on the same “Mega Mall” property where they currently sell Hyunday/Kia/Genesis/Ford/Mazda/Mitsubishi/Nissan, but I expect that if they’re going for a more luxury experience they’re going to want geographic separation from the hoi polloi.

      • 0 avatar
        slavuta

        The good news, we have a road in the area where they have some real estate to build on, and this is where they have Acura, MB, BMW, Infinity, Volvo, right along that road. So, naturally, they can build Genesis there.

  • avatar
    energetik9

    I can see separation, but not with a couple models that look very similar.

    I rented one of these a few months ago and walked away not very impressed. I’d love to see if the consumer perception, brand image, and sales data even support this. I think there is still a mismatch on a true upscale product vice how the consumer views them.

    • 0 avatar
      bd2

      The G80 and G90 look less similar than the Germans.

      As for sales data – the G80 and G80 duo outsell the A6/A8 and GS/LS.

      Still, relatively low volume until the entry-level sedan and crossovers hit the lots.

      • 0 avatar
        energetik9

        The most recent data I found that was complete was 2016, and the A6/A8 outsold Genesis that year (in the US). Worldwide is a even wider gap. Not sure the A8 needs to be in that same comparison.

  • avatar
    FreedMike

    Well, if the dealers are serious about the Genesis brand, then they’ll get on board.

    But until they have some crossovers to sell, they shouldn’t expect much business.

  • avatar
    pmirp1

    If I work for a Hyundai dealer as a salesman, or in any capacity I am furious.

    First they lack products (think equivalent to Kia Soul or any truck or small CUVs or body on frame trucks), then they get rid of equivalent Avalon, then now they want to take away Genesis.

    Then they fire people because Hyundai sales is down.

    This must be the worst managed brand in America now that VW is getting their act together. It is a joke.

  • avatar
    Caboose

    GENESIS?!

    Genesis is dealer forbidden. Permits many. Money…more.

  • avatar
    ajla

    I won’t be too happy if I buy a new G70 or G80 Sport in the next year and Hyundai responds by moving the nearest dealer an hour or more away from where I purchased the car.

    • 0 avatar
      b534202

      That’s a very valid concern with so many fewer dealerships planned.

    • 0 avatar
      bd2

      Reportedly, the G70 and all other ’19MY models and beyond will only be available at Genesis dealerships.

      Won’t be an issue for those who purchased a G80 or G90 at a Hyundai dealership, as they can continue to service them at Hyundai dealerships (or those certified to service/sell the G90).

  • avatar
    volvo

    I think having a separate dealership or showroom is an unnecessary expense.

    For me all they would need is a reception desk clearly labelled Genesis where I would be met by a polite receptionist and introduced to a low key, experienced sales associate.

    Same on the service side. Clearly scheduled service appointments, separate “service advisor” who does not engage in up-selling and an automatic loaner where appropriate (the loaner could be a Sonata for all I care}.

    • 0 avatar
      ClutchCarGo

      Having visited a Hyundai dealer last year I can see why they want separation. Hyundai is still very much an entry level brand, with entry level staff and entry level customers. The salesman I dealt with was young and green, the décor was cheap and gaudy, the background music was raucous, the other clientele were obviously lower middle class at best. If they’re going to market Genesis further up the economic ladder they need to provide a more upscale customer experience in the showroom. Older and more refined sales staff, plusher and more restrained décor, more dignified music. They can be a value oriented alternative to Lexus and Audi only if they offer a similarly value oriented customer experience. Sharing space with Hyundai undercuts that.

      • 0 avatar
        ajla

        “the décor was cheap and gaudy, the background music was raucous, the other clientele were obviously lower middle class at best.”

        If this is a serious issue for people then maybe I’m not Genesis material in the first place.

        I pretty much agree with Mr. Volvo, just give me a Sonata when I show up for service and I don’t care if they are playing Daft Punk over the loud speakers or if customers in the waiting room are wearing K-Mart jorts.

    • 0 avatar
      jalop1991

      “For me all they would need is a reception desk clearly labelled Genesis where I would be met by a polite receptionist and introduced to a low key, experienced sales associate.”

      Except you’re in the same facility as Kurt Russell in Used Cars. And when the low key experienced Genesis guy isn’t available, you’ll be hustled right over to ol’ Kurt–who will take care of you exactly the only way he knows how.

      And the entire physical facility will still resemble a Wal Mart on a snowy Saturday afternoon.

      • 0 avatar
        volvo

        Sigh

        I am sure you are correct. I kind of hoped that the dealerships would avoid that kind of behavior but now that you spell it out that kind of behavior is just in their genes.

      • 0 avatar
        bd2

        Separation is the way to go for a full-line of Genesis vehicles.

        That being said, Hyundai dealerships can vary widely.

        The one near me is huge and can pass for a lux dealership.

        They actually have a 2nd smaller store (not nearly as nice) which sells Nissans.

        But yeah, the older/smaller Hyundai stores can be a pretty crappy experience.

  • avatar
    n_tesla

    As a replacement for my BMW I bought a low mileage Genesis V8 to “try it out”. The car was fine, but after two different dealers for service and warranty work I replaced it. The buying experience is only the first step. Having a top shelf service experience is what makes a luxury brand.

  • avatar
    Dilrod

    My local dealer is part of a pretty big network. They have a newer store on one of those “dealer rows,” pretty nice, but too crowded. The keep one Genesis on the floor along the south wall. You pass it on the way to the service desk and they usually keep an Accent or Elantra right behind that.

    I can’t see them dedicating a huge store to just Genesis, but I bet that dealer is one of the 100. Will be interested to see what they do.

  • avatar
    Big Al from Oz

    I can see Hyundai want to earn more from the Genesis brand by removing them away from the Hyundai brand.

    This will take a few years to complete, I don’t envisage any problem with this as Hyundai are building a good reputable brand.

    I do read many comments on this site degrading the Koreans, but of late they are putting out some incredibly good vehicles. All they need to add to their vehicle lineup is a good competitive midsizer and a true off road SUV, both with diesels of course.

    Hyundai or more correctly Genesis needs to get hold of the Telluride, spruce it up, then drop the blown 3.3 from the Stinger into it and sell it.

  • avatar
    Sub-600

    G80 buyers aren’t cross shopping Elantras?


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