LOS ANGELES — Hyundai's fledgling Genesis marque wants out of the nest — now.
This month, the brand plans to announce a new retail strategy for the U.S. that will accelerate its separation from the Hyundai marque and significantly cut the number of dealerships authorized to sell Genesis models.
The transition, which was supposed to be several years off, likely will be messy and costly for Hyundai and the culled Genesis dealers. It comes less than two years after Hyundai announced the creation of the Genesis brand, barely a year after it officially put the G80 and G90 sedans on sale and just ahead of the launch of a critical new vehicle, a BMW 3-series fighter called the G70.
And it will require a delicate dance by Hyundai Motor America to protect its relationships with castoff dealers, who will retain their Hyundai franchises after the dust settles.
"We don't see a path forward without a good, strong dealer network that's also profitable," Genesis General Manager Erwin Raphael told Automotive News. "And we sometimes have to make
very difficult decisions in the short run in order to ensure that we take care of our ... dealers in the long run."
Genesis plans to have the framework in place by the middle of next year, it says.
The planned reset comes amid a debacle in Louisiana, where Hyundai Motor America last month grounded all sales of Genesis vehicles after allegations from the state’s Motor Vehicle Commission that the automaker and the dealers lacked proper licenses to sell vehicles under the new brand. A month earlier, dealers said, Hyundai had outlined plans to trim its Genesis network in the state to just two dealers from 13.
The automaker has nearly completed the paperwork to put it in good standing with the commission, Raphael said, attributing the problem to a hasty ramp-up.