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In defense of Equus

Posted by Keith Griffin  December 20, 2010 12:46 PM

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(Clifford Atiyeh/Boston.com Staff)

The Hyundai Equus on display at the 2010 New York Auto Show.

The Hyundai Equus is a $58,000 Korean luxury sedan. Yet, since its introduction in April at the New York Auto Show, it has been greeted with equal parts derision and fascination. Detractors question how a brand known for its low-cost, long-warranty products that were all about basic transportation can hope to deliver the luxury experience. Proponents simply point to Hyundai's sales and product success the past few years and say, "Why not?"

In a nutshell, in keeping with the Hyundai brand of late, the Equus is a fully-loaded sedan that competes in amenities with famous nameplates like the Audi A8, BMW 7 Series, and Lexus LS while costing roughly $25,000 less (it tops out at $65,400). It lacks for nothing in the way of luxury.

The man addressing the pros and cons for the Equus launch in the United States has been Derek Joyce, its product manager. He has spent countless hours traveling the country (as well as to Ulsane, Korea where the luxury sedan is manufactured) selling the Equus to the media, dealers, livery company owners, and others.

Joyce sat down with the Globe for a widespread discussion about the Equus, appropriately enough, at The Equus restaurant in Tarrytown, N.Y., during a press event.

What to expect

The Equus will have 5-year/60,000-mile total factory maintenance including brake pads and brake rotors. Apple iPads, loaded with an owner's manual app, will be presented to customers two weeks after they buy the car at a follow-up visit. Hyundai will still print an actual manual. "We've done a lot of things people are going to appreciate," said Joyce.

The Hyundai Equus is not a carbon copy of the Korean domestic market version. Joyce said changes needed to be made for the U.S. market. Topping that list was 19-inch alloy wheels where the Koreans use 18-inch wheels. "The car needs large, aggressive wheels. We determined that," he said. "It gives you a lot of performance advantage. With 18-inch wheels, you lose a lot of sense of power and the mass of the vehicle overpowers it."

2011-Hyundai-Equus-interior.jpg

(Clifford Atiyeh/Boston.com Staff)

Click image for larger version.

One thing the Equus lacks is all-wheel-drive. "You need rear-wheel-drive or all-wheel-drive in the luxury segment," said Joyce, adding that Hyundai will explore all-wheel-drive for the future but that would involve a big platform change.

Keeping it simple

Hyundai hasn't messed around by adding multiple trim levels. Basically, you pick from Column A (Signature) and Column B (Ultimate). Joyce predicts 20 percent of buyers will adopt the Ultimate trim level that splits the rear into two distinct sitting positions with a recliner for the right rear passenger. "We're going to meet market demand," he said, adding that first-year early purchasers typically want the bells and whistles.


The Equus as a limousine


Could the Equus replace the Lincoln Town Car, which ceases production in 2011 and is a staple of livery services throughout the United States? Joyce said he has met with limousine operators who have expressed interest in the Equus. Mostly, they are interested in the car's durability.

2011-Hyundai-Equus.jpg

(Hyundai)

Click image for larger version.


Interestingly, the livery operators don't want the Ultimate package that is more suggestive of the chauffeur lifestyle. "They were more interested in the Signature because of the backseat diversity," said Joyce, adding that they are also interested in the 380-horsepower, V-8 engine that was recently named one of Ward's Top 10 engines in the world.

It doesn't bother him to get the exposure from limo companies. "Clearly they're not buying it for low-grade use. It's for their high-end clients. It also helps Hyundai reach a new audience."

Hyundai only plans to sell 2,500 units next year. "You won't see volume Equus out there," he said. There are no plans currently to bring the Korean limo version to the U.S.

The Dealership Experience

The Equus purchase and service experience is going to be like no other currently offered. Equus "champions" will come to your home to sell you the car and then pick it up and drop it off for service, while leaving you a loaner (either an Equus or Genesis).

There are 250 dealers approved to sell the Equus — about one per market — out of 700 dealers nationwide. "We want to make sure we provide the Equus-level experience," he said. By that, Joyce means the customer never has to set foot in a dealership. Owners can call up the Equus app on their iPads and schedule service at their own times and locations. It's a convenience only offered in the US.

"Why be at the front of the line or the back of the line when you can have no line at all?" he said. "We're going through a lot of trouble and expense to provide this service."

Detractors say that Hyundai wants to avoid the mistakes Volkswagen made when trying to sell the Phaeton to the US market. It's a luxury sedan that sells well around the world, but failed here because people didn't want to spend $100,000 for a sedan sold next to Golfs costing one-sixth the price.

"We're aware of the Phaeton and want to learn from the mistakes but that's not the reason we have the Equus ownership champions. The Phaeton was not a focus for us," said Joyce. (In August, Volkswagen announced it would bring back the Phaeton to the US.)

Since the interview, though, Hyundai has revived its plans to create a separate luxury division called Genesis. In January 2009, a top marketing manager told us Hyundai didn't want to spend the money — about $10 billion — to build a Lexus-like brand. But in a recent interview with the Wall Street Journal, Hyundai Motor America CEO John Krafcik said sales success of the Equus will determine if the company makes the move.

2011-Hyundai-Equus-interior-full.jpg

(Hyundai)

Click image for larger version.


Who will buy it?


In general, Hyundai tends to attract a share of value-oriented people. The warranty is rational, Joyce said, and people like the tremendous equipment offerings for the lower price.

"All the product attributes are there," he said.

The company expects its fair share of Warren Buffets but it won't just be billionaires who drive Buicks that purchase the Equus.

This blog is not written or edited by Boston.com or the Boston Globe.
The author is solely responsible for the content.

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Clifford Atiyeh is an automotive writer and car enthusiast . He has spent his entire life driving cars he doesn't own.
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