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Hyundai tries for spot in luxury market

21 August 2008 13:55 (UTC +04:00)

Baku. Nijat Mustafayev â€“ APA-Economics. hey admit the timing isnâ€™t great to bring out a big luxury car to compete with BMW, Lexus and Mercedes, but Hyundai Motor Co. executives are hoping the new Genesis sedan will catch on with a specific group of U.S. buyers.
"Confident nonconformists," said John Krafcik, vice president of product development for Hyundai North America. "Theyâ€™re folks who donâ€™t typically need the social badge of a premium brand. Theyâ€™re confident in themselves and in their own skin."
Conformist or not, there were far fewer luxury buyers out there in the first seven months of this year due to high gas prices, tighter credit requirements, economic uncertainty and declining home values that have cut into the typical buyerâ€™s net worth.
Luxury car sales are down nearly 15 percent from the same period last year, and industry analysts say it doesnâ€™t look like recovery is coming anytime soon. In addition, leasing, used by about half of U.S. premium vehicle buyers, is getting more difficult and likely will further cut into the market.
Enter the Genesis, which started hitting showrooms in small numbers at the end of June.
"The timing isnâ€™t the best," said Aaron Bragman, an auto analyst with the consulting company Global Insight.
Yet Krafcik said the Genesis, which was painstakingly engineered to be lighter, quicker, quieter and handle better than most competitors, should be able to attract buyers in a tough market due to its price, features and performance.
A six-cylinder Genesis has a base price of $32,250, with the soon-to-arrive V-8 starting at $37,250, excluding freight. Thatâ€™s at least $10,000 less than high-end competitors, but more than the price of what Hyundai considers its primary competition, cars like the Pontiac G8 ($26,910 with a V-6) and Chrysler 300 ($25,150 also with a V-6).
The company, he said, eventually hopes to sell 50,000 Genesis models per year, including a new coupe coming early next year.
He said the slumping economy in a way should help the car, attracting buyers who may not be able to spend as much on a high-end vehicle but want to keep the performance and features of a luxury car.