Hyundai’s Genesis brand is a dark horse in U.S. luxury vehicle market

New York – when Hyundai Motor When the South Korean automaker launched its Genesis luxury brand in the country in 2016, which at the time mainly produced budget cars, many expressed doubts that the South Korean automaker knew what it was doing.

Skeptics include auto industry veterans Randy Parker and Claudia Marks.Both were working at Nissan’s luxury brand Infiniti before jumping to Hyundai Group, where Parker led the Hyundai brand in the United States.

“Both of us were thinking, ‘Oh my gosh, how are these guys going to make it?’ I mean, there’s nothing against it. It’s just complicated. It’s a new brand in such fierce competition. Marquez, who currently leads Genesis in North America, told CNBC at the New York International Auto Show last week.

Genesis not only did this, but also thrived and became a dark horse in the American luxury market with its unique styling, unexpected comfort and top-notch quality. Both gasoline-powered cars and electric cars do this.

Since 2022, the brand has surpassed the decades-old Infiniti brand in annual U.S. sales. Marquez said executives expect to continue achieving double-digit annual growth over the next five years. Marquez was appointed chief operating officer of Genesis North America in October 2021.

“As of now, we have to go beyond the luxury market,” she said. “It’s going to continue to be strong. This has to be a marathon, not a sprint.”

Genesis was originally a model in Hyundai’s lineup, but the company announced in late 2015 that it would become its own brand. Its U.S. sales have since grown from less than 7,000 vehicles in 2016 to more than 69,000 last year.

Along these lines, Hyundai Motor President and Global Chief Operating Officer Marquez and Jose Munoz noted that while Genesis is expected to post strong growth, in order to preserve the residual value and pricing of the vehicles, its growth rate will be restricted.

Munoz said expectations for the brand “remain high,” but that its U.S. sales targets are more in line with rivals such as Porsche rather than those of Lexus and Mercedes-Benz, which sell more Hundreds of thousands of cars.

“We still have a long way to go, but this is not a mass brand. So we don’t have huge sales aspirations, but there is still a long way to go,” said Munoz, who is also Hyundai Motor’s CEO. Genesis Motor North America said in a separate interview at the auto show.

Based on 2023 sales calculations, the brand’s closest competitors are Land Rover (71,727 units), Porsche (75,415 units), Lincoln (81,818 units) and Volvo (128,350 units). Genesis sales last year increased about 23% from the previous year to 69,175 vehicles.

One of Genesis’ biggest challenges remains consciousness, Marks said. Stephanie Brinley, chief auto analyst at S&P Global Action, agrees.

“This is an upstart that has earned credibility; now it has to win a broader audience,” Brinley said. “At this point it’s respected. The problem is, not enough people understand it yet. … That’s the space it occupies now.”

The brand may also expand its Three-row SUV lineup. Genesis unveiled a large all-electric SUV concept last week. Marks declined to discuss potential production plans but said he expected such a vehicle “sooner rather than later.”