Genesis goes to the shops

Shopping malls in Melbourne, Sydney and Brisbane will take the place of traditional new-car dealerships when Genesis launches as a standalone luxury brand in Australia in November.

The budding luxury car brand makes no apologies for rejecting a traditional dealership model and has decided to “fish where the fish are” with sites in Bourke Street, Pitt Street and Queens Street malls in the three capital cities.

Genesis Australia boss Peter Evans says Bourke Street Mall in Melbourne has more than 56 million visitors a year and the figure for Pitt Street in Sydney is more than 48 million.

He rejects any notion of a gamble, despite the multi-million spending on the program and the delay in the on-sale dates for the Genesis G70 and G80 which have been caused by the complication of the new sales model.

“I don’t think it’s a gamble. It was a vision out of our parent company, who obviously decided after 50 years of making cars it was time to enter the luxury car market in a more committed way,” Evans told motoring.com.au.

“We wanted to have a customer experience unlike a traditional dealer-operated site. Instead of driving up on Saturday or Sunday at an auto alley, you get a lot more foot traffic. And they are not pounced upon like they are in some dealerships.

“We looked at every possible combination and permutation of dealer and factory involvement. To summarise it, it’s the customer experience and the control of the customer experience that comes with owning the whole supply chain,” Evans stated.

The mall move has taken many months of planning and fine-tuning, from leasing space and designing the showrooms to recruiting staff and finalising a service program which will involve collecting cars from owners and leaving them with a loan vehicle -- as key rival Lexus did in its early days.

“We want to make it frictionless and painless. And we wanted a more casual experience. It’s about personalisation,” Evans said.

The critical Corporate Identity (CI), using black-and-gold colouring, has only been finalised in recent weeks.

“The CI has been an evolving program. We’ve got more books than the state library. It has actually evolved quite a bit, as Korea has opened stores,” says Evans.

He rejects industry speculation that dealers were unwilling to commit to or invest in Genesis, which is being set as a genuine stand-alone brand and not a Hyundai spin-off in a separate section of an existing dealership.

“These will all be factory sites. This is the first time the Genesis model is evolved to the point that the factory owns the retail outlets. But we’re fairly confident,” said Evans.

“We’ll roll them out as we go. We’re leasing stores, rather than buying land and building on it.”

Evans is reluctant to claim an industry first for the program, citing the rollout if pop-up stores and non-traditional sales sites by Tesla, Jaguar in Sydney and Subaru in Melbourne.

He also talks about online shopping, delivery of test-drive cars to a potential buyer’s home, and even a fully online program from start to finish.

The first Genesis site will be in Sydney and there are currently no plans for any more than three.

“There will be three initially and we’ll see how the business model goes,” said Evans.

“At the moment we’re on target for the last quarter; middle of the last quarter. It will be three sites for the foreseeable future, but that depends on the reception for the business model. We’ve done a fair bit of research and know what people like and don’t like.”

Evans admits he is playing defensive shots at the moment but has been hamstrung until now by secrecy and the work involved in the program. He refuses to talk about the investment, car prices or warranty.

“It involves large building works, large installations, development applications, and all the rest. The lease is one of the biggest costs, then the fit-outs.”

He will not go into detail about the design or style of the sites, only talking in vague details for now.

“One of them has the potential to hold seven cars, but we don’t want to over-crowd it. So we’ll probably target for about five for the first store.

“When we are only selling G70 and G80, five cars gives you a pretty good coverage of the regular and sports models.”

Evans is now one of six people working on the Genesis project and the team has recently moved to a larger office space in Hyundai’s corporate headquarters at Ryde in Sydney. He is bullish about the program and hopeful of a successful launch.

“I guess the expectation if we grow as planned is that we’ll out-grow our new offices in 12 months.

“I think the issue for Genesis is how quickly we can build a brand and a following. We’ve looked at how long it took Lexus, how long it’s still taking Infiniti, and we know where Jaguar and Volvo are at.

“We know where the three German brands are and how they got there, so we’re trying to accelerate the growth profile for Genesis,” he stated.

As we’ve reported, the mid-size G70 sedan – a direct rival for the Mercedes-Benz C-Class – will now spearhead the Genesis brand here alone in November, followed by the bigger G80, a facelifted version of the original large ‘Genesis’ sedan, in the first half of next year.

The two initial Genesis sedans will be joined by a pair of SUVs -- the five-seat GV70 and seven-seat GV80 – from 2020.