Hyundai's large car dilemma

Rear-wheel drive cars accounted for almost 78 per cent of large-car sales last month, according to VFACTS. That percentage was shared between just two models, Commodore and Falcon.

The remaining 22 per cent of sales were split between the Toyota Aurion (the only front-driver to reach four-figure sales for the month), the Honda Accord, Skoda Superb, Nissan Maxima, Hyundai Grandeur and one solitary Mitsubishi 380.

That the discontinued Mitsubishi was the only car outsold by Hyundai's Grandeur -- itself registering just six units sold for the month -- is a sign that Hyundai's worthy but unexceptional car is not establishing much of a foothold in the market. And that's despite the driveable turbodiesel option Hyundai offers in the Grandeur; a unique selling proposition (more here) -- at least until the Superb happened along...

There appear to be at least two elements that hinder the Grandeur from meeting sales projections. Firstly, it's front-wheel drive, in a segment where the buyers blatantly prefer rear-wheel drive cars. Secondly, it's badged as the product of a maker better known for smaller (and cheaper) cars.

During the same month that the Grandeur sold six cars, the mid-sized Sonata sold 126 units and the combined sales of the small-car siblings, i30 and Elantra, amounted to over 2000 units -- with the i30 far and away the more successful, selling 1959 units and even outperforming the light-segment Getz, sweetheart of rental fleets. Clearly, sales shrink geometrically for Hyundai with each upmarket step beyond the small-car segment.

It would be easy to argue that the Grandeur is a victim of its own pricing, relative to its perceived market position, but Hyundai has no apparent difficulty selling the Santa Fe SUV for the same sort of money (200 units last month).

There is, of course, a third likelihood for the Grandeur's underachievement: buyers just don't find the Grandeur an appealing package, whether by virtue of styling, dynamics or a combination of traits.

The Carsales Network has checked with Hyundai in the past as to whether the company would develop a right-hand drive version of the Genesis for Australian consumption (more here), but having now seen both the sedan and the coupe variants in real life, during our sojourn to South Korea with Kia last week, the absence of the RWD Hyundais here seems more anomalous than ever.

Hyundai's Senior Manager Product Communications and Public Relations, Ben Hershman, reiterates that the principal stumbling block for the Genesis reaching Australia remains the lack of a right-hand drive variant.

"It's left-hand drive only," he told the Carsales Network yesterday, but he does admit that Hyundai Australia is lobbying the factory for the Genesis to join the Australian product range.

"We're certainly talking with HMC very proactively about it, but I haven't been told that they're coming."

The Genesis sedan, styled more conservatively than the coupe, is nonetheless attractive and modern. It's a quality product, based on its Consumer Reports ranking, and it shouldn't be short of grunt either. That makes it a strong contender against upmarket Commodores and Falcons, potentially -- and it would help Hyundai with its own brand-boosting in this country.

Being available as a coupe as well as a sedan, the Genesis could and should compete in the VFACTS sports segment as well as the large-car segment. Last month, Nissan sold 102 units of the 370Z. Hyundai sold just three units of the aging, front-wheel drive Tiburon. The Nissan is more expensive than the Hyundai, which suggests that newer will always be more popular than older in this segment -- and it helps if a car's rear-wheel drive also.

Assuming that HMC has a change of heart and develops a right-hand-drive Genesis for the Australian market (and other RHD markets), could Hyundai overcome buyer resistance to the brand in that segment by selling the car through a separate marketing channel, as Holden does with HSVs? Exclusive 'Genesis' dealers with an annex set aside for the large-sedan and sports car offerings might even 'skyhook' the whole brand upmarket. And then it's a hop-skip-jump to introducing the upper-large S/7-sized Equus as well (pictured).

"That's an interesting question... it's not something we've considered," Hershman responds.

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