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Genesis aims at low-priced luxury

Hyundai will spend $80 million to address consumer skepticism

As alarm clocks ring, a Hyundai commercial compares the quiet of the Genesis cabin to the quiet of Mercedes-Benz and BMW vehicles.
ANN ARBOR, Mich. — The weak U.S. economy is helping to boost early sales of the new Hyundai Genesis premium sedan, company executives say.

The top-of-the-line V-8 version of the Genesis has a base price of about $38,000. Hyundai initially identified the target buyer of the Genesis as an owner of a mid-sized or large mass-market car who wants to move upscale.

But John Krafcik, Hyundai Motor America's vice president of product development and strategic planning, said at a press event here last week that the Genesis also is appealing to budget-minded owners of costlier luxury cars.

"That group, in these economic times, seems to be bigger than we expected," Krafcik told Automotive News. "We are seeing a lot of people who say, 'I didn't really get good value from the premium brand and the $3,000, $6,000, $10,000 or $15,000 extra I had to pay.' "

Book of Genesis
Elements of Hyundaiís $80 million marketing campaign to launch the Genesis premium car
-- Nine 30-second TV spots that mostly compare Genesis engineering to luxury competitorsí
-- Dedicated Web site:
-- 12 long-form online videos
-- Print and out-of-home ads

Sales target: 50,000

The Genesis sedan went on sale in late June. Production of a coupe is scheduled to begin in December. Next year, Krafcik said, Hyundai expects to sell as many as 50,000 of the cars to U.S. buyers.

Hyundai identifies the primary competitors of the Genesis as the Chrysler 300C, Lexus ES 350, Pontiac G8 and Cadillac CTS. "Image" competitors include the Lexus GS series, Infiniti M series, BMW 5 series and Mercedes E class.

To address consumer skepticism about Hyundai's move into the premium market, the $80 million advertising campaign for the Genesis will feature engineering test results that favorably compare the car with its competition. The tests cover such measures as acceleration, braking, cornering, interior sound and exterior finish.

"We are trying to overcome what we know are prejudices toward the brand," Joel Ewanick, Hyundai Motor America's marketing vice president, said in an interview. "So we are providing the burden of proof and laying out those key elements we know are important to consumers."

TV saturation

The ad campaign includes 12 online videos and nine 30-second TV commercials. New TV spots will appear during this week's Democratic National Convention and run through November, Ewanick said.

"You will have to be dead or living in a cave not to see a Genesis ad," he said.

Krafcik said 44 percent of early Genesis buyers have annual household incomes of more than $100,000. "That is new territory for Hyundai," he said.

Many Genesis buyers, Krafcik said, "have already tasted a premium brand, and they know what they are getting. Or more importantly, what they are not getting: 'My life didn't change when I bought a Mercedes. Maybe I will give this new brand a try.'"

Consideration of the Hyundai brand is growing, Krafcik said. This year, 56 percent of consumers surveyed by the company said they were aware of the brand and would consider buying a Hyundai vehicle. He said the figure has risen from 41 percent in 2005.

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