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Is There Room in the Luxury Market for Hyundai?

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Comments

  • bobadbobad Posts: 1,587
    Agree 100%.

    The price may surprise lot of people. I think there's a good chance the Equus will sell for under $50K when discounts are available.
  • captain2captain2 Posts: 3,971
    people with money are generally going to be LESS value conscious and MORE badge/brand conscious than those without it.
  • ateixeiraateixeira Posts: 72,587
    Not necessarily.

    I once read that the brand most often purchased by millionaires is Ford.

    Affluent folks demand value, you'd better believe it. They get the best interest rates from banks, the best terms on any loan, really. They buy in bulk from Costco because they can afford to stock up plus they have a large enough pantry to store the goods.

    You wanna see a lot of Escalades? Check the Costco parking lot. They are all there. ALL of them. :D
  • captain2captain2 Posts: 3,971
    could be on the Fords have no idea - but to put this whole line of logic on a different level. Which homeowner do you think is more likely to have a bunch of Sony TVs- the guy with a Lexus in the driveway, or the guy with a Hyundai in the driveway? Betcha there is some degree of correlation.
    The folks with money will buy what they think is the best, are more willing and more able to pay for it, and are also more likely to want to flaunt it. Nothing wrong with that, it's just human nature.....
  • ateixeiraateixeira Posts: 72,587
    The folks with money will buy what they think is the best

    I agree with that, but that contradicts your whole badge-snob theory a bit.

    are also more likely to want to flaunt it

    That I do not agree with. They are the only ones ABLE to flaunt it, by default.

    I live in fairly affluent Potomac, MD. What I've seen is the old money crowd tends to get the mid-size and bigger Benzes, Audis, BMWs. I'm talking E class, 5 series, not entry-level.

    New money goes for small Lexus and Acuras. That may very well be a generational thing - these young folks grew up driving Hondas and Toyotas.

    Soccer moms drive the RX350 and MDX around here.

    The BMW 3 series and Infiniti G35/37 sell to the car guys.

    The ones who want to flaunt it and appear more rich than they really are tend to lease low-end models. The cheaper, psuedo-luxury cars.

    They'll live paycheck to paycheck but by golly they will put an upscale badge in their driveway, even if they can't really afford it, to keep up with the Joneses.

    Clearly that is not the same guy who buys a Genesis sedan. They just have the money and want a really nice car, and are secure enough not to care what the Joneses even think.

    I'd segment the demographics much more than you, not just the Haves and Have-nots. It's also a matter of age, new money vs. old, enthusiast vs. point A-B, image-conscious vs. not insecure. You get a little of everything.

    Where does the Genesis buyer fall?

    I'll guess...

    Haves
    Younger
    New money
    point A-B
    not insecure

    Sound about right?
  • Confused. Your information says you live in Brazil? And that you have a 2002 Subaru and a 93 Miata.
  • The automotive market once described the AMC Ambassador and large Studebakers as "luxury cars." A well equipped Sonato, Camry, Honda, etc. are luxury cars.
  • captain2captain2 Posts: 3,971
    The folks with money will buy what they think is the best

    I agree with that, but that contradicts your whole badge-snob theory a bit.


    no contradiction at all, the key word here is 'think'. And what people 'think' is the best is what historically has been the best, and more importantly what they are told is the best. They can go out and test drive a top-of the line Genesis, be impressed as hell with it, fully understand that they could be saving 20 large, and STILL be predisposed to buy that Lexus or whatever. Heck, true luxo buyers would have a problem in even going into a Hyundai dealer in the first place, never mind actually buying one. Their own ignorance and loss? Probably, but not really the point is it?
  • toyetoye Posts: 351
    It was expected the base model of the Genesis would sell the most. Well it turns out the 75% are buying the Genesis with the Tech package in the 3.8 and 4.6. That is one reason Hyundai is bringing in the Equus people are willing to pay top dollar for a Hyundai with the proper equipment. I would have not bought my Genesis without the TECH package. I suspect this will happen with the Equus as they will sell more fully loaded than the base model
  • bobadbobad Posts: 1,587
    The ones who want to flaunt it and appear more rich than they really are tend to lease low-end models. The cheaper, psuedo-luxury cars.
    Bingo!

    The ones that are comfortably wealthy don't need to impress anyone. When I was climbing the ladder, I wanted German. Big mistake. Now, all I want is something comfortable, stylish, and reliable. I don't give a hoot what the neighbors think. In fact, I like to keep things low key. You never know when a kidnapper or robber will target you because of a fancy badge on your car.
  • backybacky Twin CitiesPosts: 18,695
    Which homeowner do you think is more likely to have a bunch of Sony TVs- the guy with a Lexus in the driveway, or the guy with a Hyundai in the driveway? Betcha there is some degree of correlation.

    I would think so also. But that doesn't necessarily correlate in the way you think it does. I'll bet you are thinking, the person with the Lexus in the driveway is the rich one, and the one with the Hyundai in the driveway is the poor slob who can't afford anything better. What I see in the correlation is, the person with the Lexus is more likely to be brand-conscious, hence more likely to have a brand like Sony, than the person who has the Hyundai. Income-wise, who knows? Maybe the owner of the Hyundai is looking for most value for his/her hard-earned dollars, and they don't like the idea of throwing money away on small, oval-shaped chromed metal badges with an "L" inside. ;)
  • houdini1houdini1 Kansas City areaPosts: 5,874
    I'll go along with that with some reservations. If luxury cars don't deliver what they promise and don't meet the buyers expectations then sooner or later they lose their appeal. Fool me once, etc......Just ask Cadillac or Lincoln.

    2013 LX 570 2010 LS 460 2002 Tacoma 4x4

  • backybacky Twin CitiesPosts: 18,695
    Eventually, yes. I think that's true with brand loyalty in general. If someone has a bad enough experience, they might look elsewhere. I do see stories like that in Town Hall, e.g. the guy who had BMWs all his life but finally got fed up with reliability problems and switched. That's why it's remarkable I think when Hyundai can grab some of these owners from the "luxury" brands. Brand loyalty can be hard to break.
  • ateixeiraateixeira Posts: 72,587
    Why are you interested in personal information about me?

    Trying to dig for dirt? Tossing mud and hoping something sticks?

    Isn't that a bit ... pathetic?

    Let's stick to the topic, OK?
  • ateixeiraateixeira Posts: 72,587
    Whatever package gives you the leather on the dash is worth the price. Both the ones I saw (V6 and V8 models) simply look like a million bucks. Is that bundled in?
  • m4d_cowm4d_cow Posts: 1,491
    Rushing what a bit?
    I don't think a car manufacturer has ever been criticized for getting a good product to market too quickly.


    In general: good product, but not enough preparation in other areas.

    It's the same thing I mentioned before, service quality, image, and the like. People walk into a luxury car dealership expecting luxury class treatment, Hyundai, as good as it is now, still doesn't have it. Like I said, luxury class is nothing like the near luxury, it's quite a gap.

    Don't get me wrong, the product is ready, but are they ready with the preparations? Are luxury buyers ready to sacrifice the "luxury" experience for the sake of price?
  • m4d_cowm4d_cow Posts: 1,491
    I personally think the interior is nice to look at (especially the brown leather, I like it a lot), and to some degree the materials have a nice feel. Does it look a mil. bucks? Not to me, the ES350 and '08 TL (haven't tried the new one) have softer leather and smoother surfaces. There's a quality feel to the controls that the Genesis lacks. OTOH, those willing to overlook that "feel" will find a very reasonable entry that gives more feature for the same money (and more room at that). Against Genesis the domestic entries are as good as dead.

    Big question is: will potential buyers feel or think the same way about Equus?

    @Dwengier77:
    But as far as I know the 6cyl. Genesis outsold the v8 by 4:1. So if that's true then one can safely assume that average buyers spend around $30-35k for their Genesis, which is about the average spending for near luxury market.

    Now compare that to the Equus' estimated $50k sticker, it's a big jump, and to a totally different class with totally different mindset.
  • Not at all, just curious re: your points of reference. Your "bio" says one thing, but your post says something else. Maybe you moved? Is there a reason you didn't respond to the question?
  • I heard from a Hyundai HQ employee that one reason there is so little marketing for Vera Cruz, Azera and some others is that they have a limited budget and right now are focusing on Genesis and Equus.
    This is another factor of rushing too many new models into the market at almost the same time as you are revising older models.
    I live in the most affluent area of SC (also BMW manufacturing HQ) and believe me the wealthy are interested in the badge. Sure, some wealthy people will go for "value" over prestige, but often that is to get a vehicle that the Prestige brands don't offer. Why do you think Lexus, BMW, Acura, MB, Infiniti, etc. got into the SUV, CUV markets? Because they were losing sales to Ford, Chevy, etc. Why is Porsche building a sedan and SUV?
    I agree with Consumer Reports classification. Genesis, Azera, Lexus ES350, etc. are Upscale brands. The mid and large Lexus, MB, BMW, Audi, etc. are Luxury brands. See their April Car issue. :)
  • bobadbobad Posts: 1,587
    What I see in the correlation is, the person with the Lexus is more likely to be brand-conscious, hence more likely to have a brand like Sony.

    And I suppose many of them have been duped. Sony and other Japanese and American brands are outsourcing heavily. Beneath the familiar logo's beat Korean or Taiwanese hearts. Brand loyalty is almost an oxymoron. Some German and Korean cars are manufactured in Alabama. Many Japanese and Korean cars are designed in California and built in KY, TN, or OH. Sears and GE appliances are full of Korean and Taiwanese components. It's a noble thought, but nearly impossible to "buy American" these days, It just doesn't make sense to be loyal to a badge as it once did. People that still buy badges are either uneducated to the above, are in denial, or easy marks. I think Hyundai is cashing in on the fact that car buyers are beginning to understand the above.
  • patpat Posts: 10,421
    People are free to share or not share any information they choose and they aren't required to explain their choices. Let's drop the focus on the personal and get back to the subject.
  • ateixeiraateixeira Posts: 72,587
    Your "bio" says one thing

    Old School Edmunds members may recall in the past they had little flags next to your name when you entered a post. That's why I have Brazil on there. Too bad they discontinued that.

    image

    Is there a reason you didn't respond to the question?

    Yes - if I answer them, that would imply it's OK for you to ask.

    If you have observations about the demographics of luxury car buyers in your area, please share, but let's keep this on topic.
  • ateixeiraateixeira Posts: 72,587
    I agree with Consumer Reports classification. Genesis, Azera, Lexus ES350, etc. are Upscale brands. The mid and large Lexus, MB, BMW, Audi, etc. are Luxury brands. See their April Car issue.

    Up until 2008 CR classified the Azera as a large sedan, not upscale, not luxury.

    For 2009 they started categorizing by price in the buyer's guide, so it fell in to the $30,000-$45,000 category.

    The Azera they tested was priced at $30,075, so it just barely made that cut, but they don't see it as upscale, else they would have categorized it that way all along.

    So the only reason it was grouped with Lexus and Infiniti is that $75 and the fact that they tested a loaded up Limited model.
  • captain2captain2 Posts: 3,971
    Brand loyalty is almost an oxymoron. Some German and Korean cars are manufactured in Alabama. Many Japanese and Korean cars are designed in California and built in KY, TN, or OH.
    I don't think there is anybody out there that doesn't understand all this - but they still pay the extra money for the Sonys or the Lexus' (or whatever), don't they? Brand loyalty and brand perceptions, however, do still exist, and influence purchasing decisions all the time.
    And yes, the folks out there that are inclined to give Hyundai a 'fair shake' are indeed also the ones that can minimize whatever importance things lilke brand perceptions and reputations have.
  • ateixeiraateixeira Posts: 72,587
    the folks out there that are inclined to give Hyundai a 'fair shake' are indeed also the ones that can minimize whatever importance things lilke brand perceptions and reputations have.

    Agreed.

    I buy the cars that best meet my needs within my budget. I could care less if it's a Ford or a Hyundai or a Mercedes.

    This is probably why I've owned a few Subarus. A lot of Subaru owners could afford more pricey cars but simply choose not to. You might say the same of some Volvos. They're not flashy but they get the job done.

    I'm not out to impress my neighbors, I'm out to impress - me!

    I think Hyundai is trying to appeal to those types of folks, absolutely. Intentionally, even. No self-respecting badge snob would buy a car without a badge on the nose! :D
  • captain2captain2 Posts: 3,971
    No self-respecting badge snob would buy a car without a badge on the nose!
    And it's when those same badge 'snobs' can see past the the end of their own noses and admit a Hyundai branded product into their 'acceptable' classification (however, begrudgingly) that Hyundai has found a 'place in the luxury market' .
    Think back to 1990 and the LS - those German badge snobs could look at a relatively high price for something that certainly had the expected quality, AND it wasn't a mere Toyota - it was something 'new' called a Lexus. Magically, acceptance into that lux fraternity came quite quickly.
  • ateixeiraateixeira Posts: 72,587
    I'm not sure if they ever will accept the newcomers. There are a lot of folks that still think a luxury car must come from Europe.

    That's why I think Hyundai will do better with younger folks. If you got your driver's license in 1990, after Lexus came out, you'd be about 36 years old today. That's probably right around the age Hyundai is targeting, too.

    I doubt they'll get a lot of 45+ year olds that recall the Excel.

    And that's OK - a young demographic is a good thing in the long-term.

    I recall a while back looking at some demographic data, and Kia had the youngest buyers in the whole industry. Those same owners are in their prime earnings years and obviously don't have qualms with buying a Korean nameplate.
  • captain2captain2 Posts: 3,971
    any manufacturer with products in the lower ends of the price spectrum would normally have a younger demographic.

    I doubt they'll get a lot of 45+ year olds that recall the Excel
    assume you left a 'don't' out of that :confuse: Without those legacies Hyundai has not nearly the problems they still have today, meaning that they possibly would not have had to extend their warranties as they did and/or discount their prices that steeply as they still do.
  • backybacky Twin CitiesPosts: 18,695
    Yes, the only reason the Genesis 3.8 is in CR's Upscale sedan category is its price. If CR had tested a loaded 4.6, it would show up in the Luxury sedan category along with the likes of the $42k Lincoln Town Car.

    Note that the Genesis 3.8 is CR's top-rated Upscale sedan, topping Lexus, Acura etc.
  • lemkolemko Posts: 15,154
    There are a lot of people putting Gray Poupon on their hot dogs and immature adults out there! ;)
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