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I like the direction Hyundai has been going recently, but unless they offer a quantum leap forward in technology & luxury with their Equus (say a hydrogen/gas hybrid that gets 200mpg while swathed in Hermes leather with a built-in touch-screen MacBookPro & free 4G connectivity lol) it'll just be seen as a value play to buyers who're more concerned with status & prestige than saving $150 or $200 per month on a lease.
Fwiw, the Equus does conceivably beat the current LS on several fronts, although there is no hybrid option. I agree with you though on the value play comment - in this part of the market, can value overcome perceived prestige?
Looks like a great value but what is it offering over the Genesis? BTW, the tau v8 in the Hyundai range got a horsepower boost
This is my biggest problem with the car - its basically a Genesis with a few more bells and whistles - attractive if you like bells and whistles I guess, but I could care less about air conditioned rear seats.
The customers who are in the market to purchase a near $60K vehicle are NOT going to be looking at Hyundai as their first choice. My mother drives an LS460 and I doubt she would ever consider even getting a Hyundai for a few thousand less than a Lexus.
Hyundai was on the right path with the Genesis...showing that they can make a luxury car that can compete with a $50K sedan for $20K less. HOWEVER...when you are talking about Hyundai producing a $60K sedan that competes with vehicles in the same price range...you have a recipe for disaster. Wealthy folks buy an S-Class because it's the flagship car for Mercedes and are willing to shell out the bucks to show others they have "made it". Hyundai doesn't have the brand recognition of Mercedes/BMW/Lexus to convince buyers to pay $60K for a vehicle with little brand respect.
I dunno - people said that three years ago about the Genesis, but they're selling. I'm curious to see how "brand respect" jives with value and "brand consciousness" - the recession I think helped Hyundai a great deal since it lets people come off as less ostentatious while still getting a really nice product.
Hyundai has the same problem that VW had, although VW had it's own in house enemy to deal with. I like a lot of what Hyundai's doing, but people spending premium money on a car are often looking for a premium experience as well. The average Hyundai dealer is simply not up to the level that they need to be to treat these customers as they expect. I personally think you will see Hyundai take the same tried and true route that Toyota, Honda and Nissan have and that is to spin off the upper end models into their own line. This could be as over the top as seperate dealers all together, or simply different wings of the dealership. Either way, when you sell luxury, you need to sell the experience as well as it is what a lot of buyers expect.
Walk into the showroom of the brands cars like the Equus and Genesis need to compete with and you can see the problem. Of course, some people will look beyond this and focus on the product, but they won't go mainstream until they offer the right experience at all levels including sales, service and financing. Yes, the Phaeton experience isn't exactly the same, but VW is far ahead of Hyundai when comparing dealerships and service departments and they still struggled to provide what the buyers expected.
I agree with you about the dealer experience, but isn't Hyundai addressing that with the concierge service and reservations to buy cars. I think you can test drive, buy, and service your car without ever going into a dealership - Hyundai will come to you.
VW btw has a poor reputation for reliability - something Hyundai has been able to conquer over the past 7 years with its product, aggressive marketing and long warranty. VW has not.
That's just it, they're not in the same price range. Take a base non-AMG S-class (W221-series S550) which starts at $90K, add a few basic options and you're easily above $100K.
Hyundai's marketing strategy here seems to be similar to the Genesis'. Talk up the Equus as a S-class competitor when you're actually gunning for the E-class customer. The $60K customer isn't/can't be an S-class shopper; he can't comfortably afford a fully loaded E-class. An E350 with just Prem II, metallic paint, and leather (yes, it really is an option - the model gets 'MBTex' by default) gets you to the $60K threshold easily. We're not even talking about an E550 let alone an E63.
So the $60k shopper has a choice between the E350 with its class-trailing 268hp V6 and a larger, roomier Equus with a 385hp V8, and the Hyundai wins the features/options/tech battle hands down. To get a V8 in a German car, you're looking at something like an A6 4.2 with less power and starting at $60K before adding a single option.
I don't think the Hyundai Equus is going to win over anyone looking at new a new Mercedes. People buy luxury vehicles partly BECAUSE of the brand prestige, not solely based on the best features. Someone who wants an S-Class but can't quite afford the price tag is likely going to get an E-Class, not a Hyundai for the same money.
I think there is a fatal flaw in Hyundai's logic...they feel many customers will see a perceived "value" in their brand. When a brand is trying to HIDE their logo from view, it shows that people who buy that brand don't necessarily want others to know what is it. A Mercedes/BMW/Lexus/Cadillac all have large emblems on their vehicles making sure fellow motorists take notice that this vehicle is X brand, Hyundai wants other drivers to look at their vehicles and not know it's a Hyundai...because who really wants to proclaim they drive a Hyundai? Until they shake that stigma, Hyundai won't be able to fully win over a market segment.
People have been coming up with various fatal flaws with Hyundai's sales/product strategy for years and Hyundai has done nothing but get better with every passing year. We won't know whether the Equus is a success or not until a year or two after its release but I'm hearing a lot of the same "fatal flaws" attributed to the Genesis and its no secret that the Genesis has been received very well. The Equus will never be a high volume model because the vehicles it will compete with are not intended to be high volume sellers but there is a good chance that it will sell well for its segment.
Location: Still in Portland, Oregon, for some reason
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Originally Posted by iTsLiKeAnEgG
People have been coming up with various fatal flaws with Hyundai's sales/product strategy for years and Hyundai has done nothing but get better with every passing year. We won't know whether the Equus is a success or not until a year or two after its release but I'm hearing a lot of the same "fatal flaws" attributed to the Genesis and its no secret that the Genesis has been received very well. The Equus will never be a high volume model because the vehicles it will compete with are not intended to be high volume sellers but there is a good chance that it will sell well for its segment.
Couldn't have said it better myself. When Toyota introduced the Lexus LS, everybody laughed, "It's just a Mercedes rip-off," or "Who would pay that much for a Japanese car?" Now Lexus is one of the most revered luxury nameplates in the industry.
I don't think the Hyundai Equus is going to win over anyone looking at new a new Mercedes. People buy luxury vehicles partly BECAUSE of the brand prestige, not solely based on the best features...
In that case, Lexus would never have taken off (and eventually beaten MB in US sales volume) and brands such as Infiniti would never have become C- and E-class competitors. These were brands that had 0 prestige when they started; after all, they were created out of thin air.
And if that were true, the Genesis would have been a huge failure too. Has it been? It's the same playbook. Talk up the product as an upmarket (say, E-class) competitor but in reality it's priced to appeal to C-class buyers who have a $40K budget. At any price point, there are some people looking for more features, more power and/or more space.
It doesn't hurt that many of the import brands have stagnated in that segment (Acura's RL never really became a flagship, the Infiniti Q was axed here, Volvo's S80 and Saab's 9-5 were never really sure where they fit into their corporate owners' lineups and lost much of their erstwhile uniqueness) while the larger domestics haven't really set the world alight: the 300C has gotten pretty old pretty quick, while GM killed Pontiac after finally bringing over a decent sporty sedan platform. Toyota's star has also diminished recently, so it's natural some people will be wondering about Lexus as well.
Reading through this, I wonder if we aren't analyzing the appeal of Hyundai the wrong way. I don't think many people are ditching their traditional luxury nameplate cars to buy these, but maybe there are quite a few people stepping up from regular brand cars to buy these. Folks who couldn't justify the price of the Mercedes, BMW, Audi, Lexus, etc., but are willing to spend a little more to get the value proposition being offered by Hyundai. Therefore a car like the Genesis is more competing against cars like the Avalon and Taurus. Folks who couldn't justify the cost of going with the A6 or E-class, but see the Genesis as a strong value play. Conversely the Equus is drawing off buyers of entry and mid level luxury cars that couldn't justify the cost of stepping up to the LS, A8, etc.
That logic makes more sense to me. I don't see someone who would consider a S class saying give me an Equus, but I could see someone who is buying CPO E-classes or new C-classes seeing a lot of value in the Genesis and Equus for not much more money. In this way Hyundai isn't necessarily a threat to the traditional luxury brands, but I don't know if that is their real competition.
I think Hyundai only wants to sell around 1,500 of these cars a year, so its not even really about sales, but image. I think that if you even see an Equus, it will be a minor event because they will be rare.
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