Nouveau riche collides with old money at Detroit show

History tends to repeat itself.

Twenty-seven years ago at the Detroit auto show, Nissan Motor Co. unveiled the Infiniti Q45 and Toyota Motor Corp. revealed the Lexus LS 400, signaling that Japan's debutante luxury brands belonged at the ball.

Next week, Hyundai Motor Co. and Volvo Car Corp. will introduce posh sedans as standard-bearers for multibillion-dollar investments in luxury cars.

Hyundai will show the G90 full-size sedan as the flagship of a Genesis luxury brand that will offer three sedans, two light trucks and a coupe by 2020. Volvo, amid an $11 billion revival plan under Chinese ownership, will unveil an S90 sedan that the company has described as its "entry ticket to the premium sedan club."

The club is bursting with applicants. Luxury vehicles account for roughly one in nine of the global industry's light-vehicle sales but 40 percent of its profits, making them irresistible to large mass-market automakers.

"It's only natural," Hans-Werner Kaas, a Detroit-based director at consulting firm McKinsey, said in an interview. "Automotive luxury, just by the sheer size of the relative profit pool, attracts lots of new players."

The clear benchmark for Hyundai and Volvo is Lexus, which has grown into a genuine rival to BMW and Mercedes-Benz. These three brands run neck and neck in U.S. sales, and together, they account for half of America's luxury-car market, which totaled 1.9 million vehicles in 2014.

Next week in Detroit, BMW plans to unveil the high-powered M2 coupe, while Mercedes plans to introduce its next-generation E-class sedan and a freshened version of the SLK roadster, which will be renamed the SLC for the 2017 model year.

Lexus will unveil the LC, an eye-catching coupe aimed at the Mercedes SL and the BMW 6 series that reflects Toyota President Akio Toyoda's campaign for racier cars. Based on the LF-LC concept unveiled in Detroit in 2012, the rear-wheel-drive LC is expected to be offered with a 5.0-liter V-8 engine or a high-powered hybrid powertrain.

Hyundai and Volvo represent an influx of Chinese and Korean capital into the industry, yet national origin has declined in importance as automakers now design, build and sell cars and light trucks globally.

Ford, which is expected to show the production version of its revived Continental in Detroit, designed the spacious sedan to appeal to Chinese customers.

Hyundai has lured top executives from Audi, BMW and Bentley to lead its upscale push. Designers from California crafted Genesis' signature look. Engineers tuned the G90 at Germany's Nurburgring racing circuit, where Hyundai opened an r&d center in 2013 to give its cars the refined manners that luxury buyers demand.

"We are reaching the level where we can offer these kinds of cars," Peter Schreyer, president and design chief of Hyundai Motor Group, said in a November interview. "Maybe five or 10 years ago it would not have been possible."

Volvo, bought by Hangzhou, China-based Zhejiang Geely Holding Group in 2010, became the first company to sell a Chinese-made car in the U.S. by launching the long-wheelbase S60 Inscription sedan in 2015. Meanwhile, the company is spending $500 million on a factory in Charleston, S.C., for easier access to the U.S. 

Volvo has tried to remain Swedish at heart by housing its core engineering and management operations at its historic home in Gothenburg -- as well as by sewing miniature Swedish flags onto the seats of its newest models. 

"Safety is still important to them, design is still important to them, and they're still playing up their Swedish heritage," said Stephanie Brinley, Detroit-based senior analyst at IHS Automotive. "What Geely appears to have done is allow Volvo enough space to carve out a space for themselves." 

Heritage and history matter. 

So even with sedans that compare favorably with the competition on paper, Genesis and Volvo may struggle if customers, dealers and suppliers do not consider them full-fledged members of the luxury-car club. 

More than a quarter century after Infiniti's Detroit debut, the brand is searching for a distinct identity apart from Nissan. Acura and Lincoln, hamstrung by limited resources and a scant presence outside of North America, have been forced by necessity to use bits and pieces from their mass-market sibling brands. 

Infiniti, hoping to escape this pattern, will unveil a curvy Q60 coupe in Detroit. It will be sold with a turbocharged 2.0-liter engine designed with Mercedes. 

Hyundai has poured resources into engines suitable for Genesis, including a 5.0-liter V-8 and a twin-turbo 3.3-liter V-6. And in a gambit borrowed from BMW, the Genesis lineup will ride on dedicated rwd platforms. 

"That, to me," Schreyer said, "is our main difference from the rest of the gang." 

Volvo, far smaller than Hyundai, has made some compromises. 

Its S90 will not offer a V-8 but rather a boosted 2.0-liter four-cylinder engine. To compensate, the top-of-the-line S90 will have a T8 Twin Engine plug-in hybrid powertrain, pairing the engine with a 65-kilowatt electric motor for a total of 400 hp. 

Unique components are helpful, but not essential to success, said IHS Automotive's Brinley, noting that Audi and Lexus have prospered while using front-wheel-drive architectures for most of their popular models. 

"History is a bigger challenge than rear drive," Brinley said. "Lincoln allowed itself to lapse into a brand that felt like a Ford with nicer materials, and now they're trying hard to recover from that. If you don't treat your own brand as a luxury brand, your customers won't, either." 

Volvo has long built a brand around safety. With the aid of sensors, the S90 will slam the brakes if it detects a common Scandinavian obstacle such as an elk or moose. 

Yet across the floor at Cobo Center, a daunting new E class will demonstrate the challenge of trying to match Germany's luxury giants on technological toys. 

Mercedes, facing heightened competition, is focused on adding technological innovations with every vehicle update, Hartmut Sinkwitz, head of interior design at Mercedes, said during a preview event in Stuttgart. 

He pointed to the dashboard, which houses twin 12.3-inch screens for the instrument cluster and navigation system behind a single piece of glass, and the touch-sensitive control buttons on the steering wheel that enable drivers to control vehicle functions without taking their hands off the wheel. 

Another new safety feature in the E class, Pre-Safe Sound, plays a special tone that triggers a reflex inside passengers' ears if a crash is imminent. This reflex can prevent the noise of a crash from damaging the ears. 

Drivers fiddling with the ambient LED lights can choose among 64 colors. They also can use a smartphone to remotely park the car in tight spaces. 

"We are aware of our history, but we don't want to be obviously traditional," Sinkwitz said, adding that Mercedes must be "courageous enough to be surprising with innovative ideas but even then stay connected with what we've done before." 

Stuttgart's new sedan also features an updated version of the Intelligent Drive automated driving system, which can now take the wheel at speeds of up to 80 mph and follow a lead car at speeds of up to 124 mph. 

This transition to self-driving cars could upend the definition of luxury, so Detroit's debutantes are planning ahead. 

Volvo signaled its direction at the Los Angeles Auto Show with the Concept 26, named for the average 26-minute commute to work. The mock-up of a cockpit from an autonomous car features three seating modes -- Drive, Create and Relax. 

Hyundai, which projects that fully self-driving vehicles will hit showrooms in 2030, recently signaled that it may start developing computer chips and sensors to maintain full control over the technology that goes into such vehicles. 

Genesis, beyond offering automated driving features, will focus on saving customers' time in other ways. 

To sell the Hyundai Equus sedan, Hyun-dai's U.S. dealerships must offer concierge service, taking vehicles to customers for test drives or picking up vehicles from homes or offices to make repairs. 

"Time is the ultimate luxury," Mike O'Brien, vice president of product planning at Hyundai Motor America, said in a November interview. "I know it sounds cliche, but it is. We can replace everything in our lives but time."

David Undercoffler and Amy Wilson contributed to this report.