Genesis, Hyundai's nascent luxury marque, is striking off on its own with a standalone dealer network.
Since Genesis' launch as a brand in 2016, its cars have been sold through some 350 Hyundai dealerships across the country. Those dealerships were told last week that, in the future, Genesis models will no longer be sold alongside Hyundais and will instead have their own dedicated showrooms.
For 2018, only around 100 Hyundai dealers will be offered a Genesis franchise. That is sure to create some fierce competition among current dealers, especially since the company will organize it so that only Genesis-branded dealerships will be allowed to do warranty work on Genesis cars.
The move is not without precedent, although its timing is unusual. It echoes the launch of other luxury spin-offs, especially during the late 1980s when marques like Lexus and Infiniti were spun off from Toyota and Nissan. More recently, French automaker Citroen lauched a luxury sub-brand called DS Automobiles in 2009. In return, customers received a premium buying experience and automakers were able to tailor their offerings to luxury-oriented customers.
However, those carmakers established their brands and dealer networks prior to launching their first cars. Lexus and Infiniti models were never sold in Toyota or Nissan dealerships, and even if the cars shared platforms, the styling was notably different. Genesis, however, started off as Hyundai sedan in 2008, followed in 2010 by the Genesis Coupe sports model.
Curiously, all Genesis models launched so far have been sedans—the Genesis G80 and G90 luxury cars—even as Hyundai is pushing out an an onslaught of crossovers in order to capture mainstream market share. Consider it a statement about traditional luxury vehicles.
The first Genesis showroom was announced earlier this month, and will be built in the upscale Gangnam district of Seoul, South Korea.