Why Hyundai needs a name change.

If you don’t know what an ‘Equus’ is you’re not alone. Hyundai wants to invade the entry to mid-level luxury market. Yes, they are winning praise and sales are climbing, but unless you give me something I can brag about, I’m not buying.

It’s no secret that Hyundai has been making quite a splash with its current lineup. For the last two or three years, most of us have been trying to pinch pennies, so we’ve taken a look at alternative brands that sip gas, have great warranties, strong resale value, high Consumer Report ratings and still have enough style that we aren’t ashamed to pull up to Church on Sundays. Well, Hyundai has been doing a great job winning in that market space, but now they want to sell us sedans that compare to BMW 5 series and Mercedes Benz E-class advertising the luxury fit and finish.

Here’s the problem, those brands have something you don’t ‘clout’. When I’m driving a BMW or Benz people make assumptions about my status and it’s part of the reason we buy those brands. And please, to the BMW and Benz apologists, I don’t want to hear about driving experience.

When I think Hyundai, I still think cheap import that’s come a long way, but I don’t think luxury alternative. I bet 7 out of 10 can’t even tell you where the company is based. If it were my call, as I set my sights on moving upmarket, I would have borrowed the Lexus strategy and gone with a separate branding for my luxury lineup. I would put distance between my luxury offering and any thoughts that your typical buyer in BMW/Benz demographic would have of Hyundai and its little two door hatch backs from the early ’90s.

Let’s take a look at one of the more recent case studies with Volkswagen’s ill-fated Phateon.
Winning Formula Check list:

  • Was the performance comparable to others in its class?  Check.
  • Did it have the fit and finish of others in its class?  Check.
  • Was the styling suitable to draw attention on the road? Iffy.
  • Would you tell your friends you paid $100,000 for a Volkswagen, when you could have a bought a used Bentley GT? What are you smoking.

Obviously, Hyundai isn’t trying to charge six figures for their cars and they are moving units, but I don’t think they are going to maximize long-term sales.

Let’s take a look at a few reasons why.

  1. They are trying to win a luxury car audience with price comparisons.
  2. The Hyundai name has little cache in the States and its lineage is traceable to economy cars.
  3. Telling your friends with BMWs, Audis, and Benz’s that you saved $10,000 when you went with Hyundai just doesn’t win you many cool points.

Recommendation:
Break out the luxury lineup under a new name and badge. At the very minimum give the buyers of the Genesis, Equus and Genesis Coupe a higher end buying experience at the dealership and still change the badge. As a matter of fact give the luxury line of cars their own dealerships with a fancy coffee maker, earth tone paint, white glove treatment and change the badge.

I get it, separate dealerships is a huge capital investment, so here is another option. Stop trying to compare the Genesis and the rest of your lineup with the German automakers and their cousins. Instead create your own market, targeting budget conscience professionals who would go with an A6, but aren’t sure if they’ll have a job next month. Use your marketing to create a confident, contemporary persona that taps into the values, aspirations and egos of the young professional demo and I bet you won’t have to lead with price.

Simply put, give me a name and a story that matches the image I want to project and I’ll open my wallet.

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One Response to Why Hyundai needs a name change.

  1. Stacie Scott says:

    This is a very interesting take on Hyundai’s luxury car lineup. You make several valid points and reasonable suggestions for change. More importantly, this blog entry was a good read.

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