Hyundai Motor Co. (005380), South Korea’s largest automaker, unveiled a revamped all-wheel-drive Genesis premium sedan today that will go on sale in the U.S. next year to revive flagging sales in the model’s largest market.
The all-new Genesis, which competes with Bayerische Motoren Werke AG’s 5-series and Daimler AG (DAI)’s Mercedes Benz E-Class in the midsized premium sedan market, will also be introduced in Europe next year, its first premium model in the market. Hyundai plans to sell 62,000 Genesis sedans worldwide in 2014, the Seoul-based company said in a statement today.
Hyundai’s first revamp of the Genesis, which won the North American Car of the Year award in 2009, comes in the wake of a series of recalls this year by Hyundai and its affiliate Kia Motors Corp. (000270) The recalls have been a blow to Hyundai, which has striven for years to upgrade its image as a maker of cheap utilitarian cars, and follow a rapid expansion of production in new markets such as Brazil and China as it competes with Toyota Motor Corp. (7203)
“The success of the last Genesis raised Hyundai’s profile from a value-for-money carmaker to a premium car contender,” said Shin Chung Kwan, an auto analyst at KB Investment & Securities Co. “Equipped with fresh looks and better contents including an all-wheel-drive system, the new Genesis is set to expand its market in the U.S. and help Hyundai win back market share from its competitors.”
The company invested 500 billion won ($472 million) in developing the new car which comes with 3.8-liter and 5-liter engine options, and features a roomier interior, new hexagonal grille and in-car gadgets such as a head-up display, Hyundai said. Its price in South Korea is set between 46.6 million won ($44,000) and 69.6 million won, according to the company.
First introduced in 2008, the Genesis’s revamp comes in the wake of the recalls that led to the resignations of executives including Kwon Moon Sik, the automaker’s chief technology officer. More than 1.7 million vehicles in the U.S. have been recalled, including the Genesis, for malfunctioning brake lights and cruise control.
Earlier this year, Hyundai agreed to settle a group of lawsuits by U.S. customers who said they were misled into buying its vehicles because it overstated their fuel economy.
Following the recalls, the company has become more stringent in quality checks for the new Genesis, said Park Joon Hong, a research fellow at Hyundai’s automotive research and development division.
Hyundai’s sales in the U.S. have risen less than 2 percent in the first 10 months of this year, versus the industry average for 8 percent growth in the same period, according to data from the company’s website.
As of end of October, 36 percent of all Genesis sedans, which are made at the company’s plants in the southern Korean city of Ulsan, were sold in the U.S. since 2008, according to the company’s website. That’s 75 percent of all Genesis sedans sold overseas.
Hyundai is targeting to increase U.S. sales by 10 percent from this year’s target of 734,000 units, according to Ahn Young Jin, director and head of its U.S. operations.
Pre-orders for the Genesis that began on Nov. 19 are set to exceed its predecessor’s monthly sales record of 5,288 units in June 2008, after getting 5,200 orders before the price of the model was even announced between Nov. 19 and 22, according to an e-mailed statement from the company on Nov. 24.
The sedan will also be sold in countries including China and the Middle East.
To contact the reporter on this story: Rose Kim in Seoul at firstname.lastname@example.org
To contact the editor responsible for this story: Young-Sam Cho at email@example.com