* New Genesis, Sonata key to reversing fortunes in S.Korea,
* Hyundai looks to sell 10 percent more cars in U.S. next
* Fuel economy drops, prices rise in S.Korea
By Hyunjoo Jin
SEOUL, Nov 26 Hyundai Motor unveiled
a sleek revamped version of its high-end Genesis sedan in South
Korea on Tuesday, a key model along with the upcoming Sonata
family car, to revive momentum in its key home and U.S. markets.
Hyundai, the world's fifth-biggest automaker along with Kia
Motors, is looking to lift its total U.S. vehicle
sales by 10 percent next year on the back of the release of the
new Genesis and, more importantly, the Sonata sedan.
The South Korean automaker said the new Genesis would offer
improved riding, handling and high-tech features to take on the
likes of higher-priced Mercedes and BMW,
but the model's fuel economy dropped.
The new Genesis will arrive in U.S. showrooms in the first
half of next year, followed by the Sonata, Hyundai's second
best-selling car in the United States.
Hyundai aims to sell 32,000 new Genesis cars in South Korea
and 30,000 in overseas markets next year. The Genesis will be
sold in Europe for the first time.
"We will remain as a follower if we fail to make cars that
can compete with top-notch models. The Genesis has a big
significance for us, and at the same time marks a challenge,"
Park Joon-hong, a research fellow at Hyundai's Research &
Development Division, told reporters last week.
Hyundai's Park said the company has undertaken rigorous
quality checks preceding the launch, after a series of recalls
and consumer complaints hurt the company's reputation.
The Genesis, which was first rolled out in 2008 and won the
North American "Car of the Year" the next year, is not a
high-volume model like the Sonata, but is designed to raise the
"A higher brand value has a ripple effect on sales of small
and mid-sized cars. If sales of the new Genesis falls short of
expectations, it will hurt the brand, and dampen expectations of
the new Sonata due next year," said Lee Hyung-sil, an auto
analyst at Shinyoung Securities.
Although it will come with a cheaper price-tag than its
European premium rivals, Hyundai has raised the price of the
main V-6 3.3-litre model by 2.3 million Korean won to 52.6
million Korean won ($49,500).
The 3.3-litre model gets fuel economy of 9.4 km/litre (22.1
miles per gallon), a slight drop from the current 9.6, and it
does not come in more fuel-efficient diesel or hybrid options,
models that are gaining in popularity in South Korea.
The 3.0, 3.3, 3.8 and 5.0 engines are available
depending on the markets.
Y.J. Ahn, a U.S. sales executive, said the company was
looking to lift its U.S. vehicle sales by 10 percent next year,
adding the figure was not finalised.
Hyundai saw its U.S. sales rise only 2 percent from January
to October, lagging the market, as its Japanese and U.S. rivals
have launched new models.
Shinyoung's Lee said Hyundai may miss this year's U.S. sales
target and it may be challenging to achieve a 10 percent sales
growth next year given that its U.S. and South Korean factories
were running at full capacity.
The Genesis unveiling comes a day before Daimler plans to
bring its Mercedes-Benz S-Class luxury sedan to South Korea.
Daimler chairman Dieter Zetsche will make a rare visit to Korea
to attend the S-Class event.
South Korea, dominated by Hyundai and Kia, is a small market
for imported cars, but foreign sales have soared 21 percent so
far this year in a flat market helped by free trade deals. For
the S-Class, South Korea is the fourth-biggest market after
China, the United States and Germany, although its sales of
about 1,000 from January to October trail the top three by a
Peter Schreyer, a former Audi designer who leads design of
both Hyundai and Kia, acknowledged it was not easy for the South
Korean automakers to go up-market, saying it took 30 years for
Audi to become a premium brand from a "boring company".