Hyundai’s Genesis premium brand is increasing the number of sales outlets in its European launch markets of Germany and the UK ahead of a wider expansion in the region.
Genesis is recruiting dealer groups to add between 15 and 20 outlets in Germany and the UK to grow beyond its city center studios that were used to launch the brand in the region.
“We tested, we found out it works. Now it’s time to press the big red button on expansion,” Genesis’s European managing director, Lawrence Hamilton, told Automotive News Europe.
The roll out of this second expansion phase will start in early 2024. Depending on the success of the move, a further expansion to other countries in Europe is expected in 3-5 years’ time, Hamilton said.
Genesis increased its European vehicle sales to 2,822 last year from 514 in its 2021 launch year, according to data from market analysts Dataforce.
Demand was helped by the recent rollout of the GV60 full-electric SUV, built on the same platform as the Hyundai Ioniq 5 and Kia EV6. The GV60 accounted for 70 percent of Genesis sales in December, Dataforce figures show.
Genesis in Europe is copying a system that it first applied to its rollout in the U.S. and Canada.
“Genesis retail experience centers are much more like a traditional dealership facility,” said Hamilton, who took over the European role in September last year after previously heading Genesis in Canada.
Hamilton said Genesis will not piggyback on the dealership networks of Hyundai and Kia network, but some of the dealer group partners with franchises for those brands would likely be adding Genesis outlets.
Genesis and its dealer partners are still discussing business terms but elements of the direct sales/agency model will be applied, for example fixed pricing, Hamilton said.
“One of the factors that has been very successful for us is our non-negotiation pricing model,” he said. “Customers like it and it’s fundamental to our ability to sell online.”
New outlets would expand the brand’s ‘omnichannel’ approach to sales that included online sales and the city center studios. Showrooms would ideally hold between 4-5 cars with no additional stock required beyond test cars.
“We believe that the agent should not have to overinvest in stocking costs in land,” Hamilton said. “That means the logistics can be very much smaller and very much more efficiency oriented.”
Instead, cars will be built to order, which does away with the need for a traditional wholesale relationship, when the dealer buys cars from the automaker.
Genesis started out by delivering cars directly to customers, who were assigned a Genesis Personal Assistant to take them through the process.
Genesis will continue with this service as it emphasizes the premium approach to car buying, Hamilton said.
The relatively small size of operations will also ensure Genesis sticks to its premium promise, Hamilton added.
“We wish to grow to luxury/premium boutique size and volumes and obviously that has to have certain scale to work, but it also needs to have balance,” Hamilton said, without giving volume targets.
The brand is increasingly relying on electric sales after initially launching with a combustion-engine range.
Since this launch the brand has rolled out the GV60 and two further full-electric versions of its sedan and SUV lineup, including most recently, the GV70 midsize SUV, the brand’s second-best seller.
Genesis has committed to selling only electric cars by 2030 in Europe.