Hyundai Considers Full-Size Rear-Drive Luxury Car for North American Market

Will Rear-Drive Car Feature an All-New Luxury Nameplate or be Badged Hyundai

With news just out about Hyundais upcoming rear-drive sports car (see automotive news section for May 27, 2005: Hyundai Confirms Development of Rear-Wheel Drive Sports Car), theres even more talk about a rear-wheel drive luxury model making it to North America.

Currently, Hyundai sells its Equus luxury sedan to dignitaries and top-tier executives in South Korea, and other markets, but thus far has left its North American operations out of the luxury loop, other than showing it every now and then at auto shows.

The same goes for its radical Equus HCD-7 concept, that when first shown at the 2002 Chicago Auto Show (see concept car or prototype section under Hyundai for 2002 Hyundai Equus HCD-7 Concept). While a little over the top, as far as Hyundais normally conservative designs go, the Equus HCD-7 pointed the way to how a future luxury model might appear, while causing those who saw it to ponder the potential of Hyundai creating a sub-brand to market higher priced premium models, similar to what Toyota has done with Lexus and Nissan with Infiniti.

And now, it seems, that the long-touted rumor of a new luxury line, above Hyundai and its top-tier XG 350, soon to be replaced by the Azera, could be a reality sooner than later. As reported in Wards Auto, April 27, 2005, a decision on a separate luxury division may come as soon as 2007 or 2008, with cars and SUVs following shortly thereafter.

Prior to that, however, Hyundai may bring a full-size model, Equus or otherwise, to the North American market under the Hyundai nameplate, in order to test the waters, so to speak.

According to the Wards report, John Krafcik, vice president-product development and strategic planning, said that the new model would represent a new flagship above the upcoming Azera.

Krafcik didnt mention if the new model would be the next-generation Equus, but he did say it would be based on the cars architecture. Doing anything different wouldnt make sense, as the cost to develop and build something altogether new just to "test" the North American market would be too high.

It is also entirely possible that the Equus name will be used here as well, although Krafcik did mention that may not be the case. Hyundai would do well to consider it, however, as the automaker has garnered a substantial amount of press about the model in the rumor mill alone, and that kind of publicity is valuable. The Equus name has a certain prestigious ring to it as well; short, precise, and possessing the sound of money in its complicated use of Latin. What does it mean? Again, its all about money, at least this day and age when owning a horse anywhere near the city is only possible for the well-to-do. Equus is translated from Latin to mean: horse, steed, or mount. Also spelled aequus, equus also means: level, even, calm, equal, favorable, and just. Yeah Hyundai, keep the name if this is indeed the car thats coming to North America.

"We are looking at something that would slot above Azera, which we are considering a premium sedan," Krafcik mentioned to Wards Auto during the 2006 Sonata sedan launch in San Francisco, CA. "But we think theres room above that for another sedan, even more premium.

"Although we dont have a timetable established, we are looking at the possibility of rear-wheel drive because that makes the most sense for what would really be a luxury sedan," he continued.

In South Korea, the Equus is available with a standard V6 engine, and an optional V8, with most analysts expecting the V8 to be the only engine offered in North America.

The potential for a separate premium brand has executives from Hyundai Motor Co. Ltd. in South Korea salivating, but the considerable costs and complexity need to pull off an entirely new brand, with its associated advertising and marketing expenses as well as stand-alone dealerships, have Hyundais North American divisions, and dealer principals less eager to move forward without some sign of interest from its customers.

Krafcik also told Wards that Hyundais possible luxury brand strategy could "differ regionally", with potential for a luxury arm in Europe but not in North America, or vice versa.

Currently, however, Hyundais domestic Equus sales are off by 36.1 percent compared to last year, according to Wards, due to more competition in its home market. The new Ssangyong Chairman is said to be part of the problem, as it has become the number one seller in the luxury class, bypassing the Equus.

Hyundai will counter with an all-new Equus next year, which should help it gain back ground.

While its success in South Korea doesnt necessarily affect the North American market, at least not directly, the introduction of the all-new model at the upcoming Specialty Equipment Manufacturers Association (SEMA) show this fall, according to Krafcik, will cause some commotion.

Hyundai must also feel its new design is bold and daring enough to unveil at SEMA, as the show traditionally pulls in youth-oriented crowds interested in specialty tuning. Equus competitors such as the Chrysler 300C, however, have done extremely well at the Las Vegas event, considered to be the largest single automotive show in North America.