Hyundai aims Veracruz at Lexus RX: Underestimates US demand

omarrana submitted on 06/27/2007 Official AutoSpies Timestamp: 2:06 PM
from: www.egmcartech.com

Tags: Lexus, Hyundai

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Hyundai aims Veracruz at Lexus RX: Underestimates US demand

It seems like Hyundai continues to act like they are playing in the big league. In an interview yesterday, product chief development John Krafcik said, “We underestimated demand for the premium trim level on the Veracruz.” The Hyundai Veracruz is the Korean auto makers most expensive vehicle ever starting at $26,306.

According to Krafcik, the Veracruz is aimed at Lexus and their RX model. Hyundai plans to roll out an ad campaign later this summer making a head-to-head comparison with the Lexus RX 350... Read Article

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SevorbeupstryIsBack - 6/27/2007 2:21:08 PM

+6 Boost

Who would buy this over an RX350?

I wouldn't.

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lexusis350 - 6/27/2007 2:26:57 PM

+3 Boost

No one would. Those who can afford an RX would get the RX. Those who want the RX but can't afford it would get a long list of optional vehicles that might include the Veracruz.

Agent009 - 6/27/2007 2:37:45 PMView My AgentSpace

+2 Boost

That same argument was used for Lexus

"I would never pay for a Lexus if I could have a Mercedes" But then Lexus found a market for those that disagreed, why not save the money and get something similar.

Now we are seeing "I would never pay for a Hyundai if I could have a Lexus" . But I bet there is a market for this as well.

Agent009 - 6/27/2007 2:41:39 PMView My AgentSpace

0 Boost

The point is there is a whole demographic that this will appeal to. There are those that CAN afford a $50K Lexus but not a $80 Merc. So the choice is simple for them. Same for the Hyundai vs. Lexus.

Then there are those can can afford both and still choose the lower cost vehicle. (Look at Warren Buffet, he drives a Lincoln) So having money really has less to do with it than you think.

ll about priorities and the amount of capital you WANT to allocate to a car.

lexusis350 - 6/27/2007 2:47:48 PM

+3 Boost

Okay, you misunderstood. I was saying it as if a person was in the market for a Lexus. Are they going to get that or a Hyundai? I know what I would do....

Agent009 - 6/27/2007 3:04:15 PMView My AgentSpace

0 Boost

Sad to say they may get some of em.. works that way with most brands.

As much as we like to think that if you own the brand you can afford it, it simply isn't true.

I see people complaining all of the time of a $200 checkup on a $60k car. To me that kinda goes with the turf. They require up keep and that costs money.

Some of these people are also the same people that lose a job and 3 months later the house and the car are repossessed. Living on the end of their budget allows and all it takes is one bump to derail them.

SevorbeupstryIsBack - 6/27/2007 3:07:44 PM

0 Boost

""I would never pay for a Lexus if I could have a Mercedes" But then Lexus found a market for those that disagreed, why not save the money and get something similar.

Now we are seeing "I would never pay for a Hyundai if I could have a Lexus" . But I bet there is a market for this as well."

Ouch. So true.

Hwany - 6/27/2007 3:38:29 PM

+3 Boost

Yep. Hyundai is following Toyota's footstepts

lexusis350 - 6/27/2007 6:13:36 PM

+3 Boost

What I was basically saying was that the Hyundai can't compare to the Lexus. But it is true that some people aren't informed on cars and might not realize that the Lexus has real wood, navigation system, and other higher quality materials. For those who do know their cars well, the choice is obvious.

Agent63 - 6/28/2007 10:35:00 PMView My AgentSpace

+1 Boost

People who can afford an RX may not always buy an RX what are you talking about?

lexusis350 - 6/27/2007 2:34:48 PM

+1 Boost

Does advertising this as "better than a Lexus" really do anything for them? Think about it. Would a rich person rather say "Hop in the Hyundai" or "Hop in the Lexus". Maybe if a person is on the borderline of affording an RX, but someone who can afford the RX will get the RX.

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Agent009 - 6/27/2007 2:57:02 PMView My AgentSpace

+1 Boost

It may give it an appeal to the less informed buyers.
The same type of customer that bought a Hyundai and thinks it looks like a Merc. To them this is more important than the actual car.

I guess we all want to be more important than we really are.

Rupert - 6/27/2007 3:25:30 PMView My AgentSpace

+1 Boost

Would a rich person rather say "Hop in the Merc".

The argument you are using is exactly the same as everyone was using in 1990. Perceptions change, and Hyundai are on their way up.
Not at the top yet though, they need their entire line up top be good, which I expect will happen in about 7 years.

Agent009 - 6/27/2007 3:38:52 PMView My AgentSpace

-1 Boost

"someone who can afford the RX will get the RX."

tell that to Warren Buffet.

Lexus - 6/27/2007 2:59:05 PM

+3 Boost

Sure there a market for them, the Lexus wannbe or poor man Lexus.

And oh! for those that says Lexus is German wannbe, WRONG.......it the other way around now. Here my proof, Toyota/Lexus one first auto company to make Hybrid vechicles for the mass. They also have the world first full luxury hybrid vechicle. And last but not least, world first 8 speed transmission, self-park vechicle techology?

When Lexus first came out with this everyone redicule for their technology. And now we have BMW, MB, Porsche, VW, Chrysler, Ford and Hyundai copying or following them in their technology.

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Agent009 - 6/27/2007 3:10:13 PMView My AgentSpace

-2 Boost

Look at the original Lexus ads they were targeting Mercedes specifically. So Hyundai is copying the Lexus play book here using the exact same analogies only targeting Lexus.

And the Chinese will probably target Hyundai when they get here.

justbrown - 6/27/2007 3:23:10 PM

+6 Boost

Correct me if I'm wrong but isnt the RX being remodeled next year. The RX has been around since 04' and from what i remember, all they did was update the engine this year with a tire pressure monitoring system and probably a few miscellaneous items. My point? The Veracruz intentionally aimed itself at a dying model and come next year when the RX gets items even the IS has such as push button start/stop, keyless entry, cooled seats and the plethora of other items found throughout the Lexus lineup, I believe this comparison will become void. It was a good try by Hyundai but they will once again be a generation behind. Don't start an entire argument over a newly designed car vs. a car soon (very soon) to be remodeled. Lexus knows what it is doing and who they are competing against. Do this comparison again when the RX is remodeled and I can guarantee you no comparison test will include the Veracruz as it will be an afterthought of an attempt at a nice (copycat) SUV.

Rupert - 6/27/2007 3:30:28 PMView My AgentSpace

0 Boost

Your proof sucks.
One could claim many things, everyone is an Audi wannabe.

AWD, DSG, turbo'd engines, diesels, AWD performance cars etc etc.

Merc wannabe:
airbags, ABS, crumple zones, cars in general, diesels (Merc first company to use diesels), worlds first 7 speed, pre safe, radar cruise control blah blah blah.

Your "proof" means nothing.
Soon someone will be the first hybrid diesel, BMW have first hydrogen car already, then first 9 speed, self drive technology and it goes on.

Agent009 - 6/27/2007 3:43:25 PMView My AgentSpace

-6 Boost

justbrown-

"Do this comparison again when the RX is remodeled and I can guarantee you no comparison test will include the Veracruz as it will be an afterthought of an attempt at a nice (copycat) SUV."

That same comment were leveled at Lexus when they entered the market.

A bit ironic to me that the feelings you are giving towards Hyundai is the EXACT feelings the German boys have against Lexus..

What goes around, comes around... I guess

justbrown - 6/27/2007 4:15:43 PM

+2 Boost

Agent009

"A bit ironic to me that the feelings you are giving towards Hyundai is the EXACT feelings the German boys have against Lexus.."

A good argument but I think you are missing a key point as to why Lexus is where it is today. Toyota knew very well that in the American market, they could not take the Toyota Avalon, call it the Toyota Avalon Limited Edition 460 (reference to a LS460) and tell everyone it competes against the 7 series. It just doesn't work that way. Toyota created a new brand for America and recently separated the two brands (Lex/Toyota) in its home country. Why? Because the Highlander DOES NOT compete with the X5 nor does it try to.

Lexus is also still the choice for the consumer who realizes that they can get so much more without being charged a premium for a propeller or star on the hood. They offer a good "bang for your buck" car and while Hyundai does as well, it should still know that its competition would be more towards Toyota and not Lexus. Lets see it beat the new Highlander hybrid which I heard got great reviews. Aim higher when you are the segment leader in a lower market. It barely just got its act together with its new models, lets not jump the gun.

Agent009 - 6/27/2007 4:51:19 PMView My AgentSpace

0 Boost

Justbrown-

Lexus wrote the book marketing to the US car buyer. The obviously wrote the book on that. Something the Germans might want to read BTW.

I also agree they target models that really have no direct competitors so it is difficult to compare. Actually to compare them is like apples and oranges, both fruit but that is it.

Lexus often hits a target that the others don't even know is there.

Agent009 - 6/27/2007 4:59:29 PMView My AgentSpace

-2 Boost

LexusAdmirer_
"You get what you pay for" true to a degree

But sometimes you pay less and get more, and Hyundai is rapidly gaining on everyone. A

fter all if you went by the JD Power VDS you are talking one more possible visit over three years than a Lexus? To some that savings alone could be the factor.

justbrown - 6/27/2007 5:09:58 PM

+1 Boost

"But sometimes you pay less and get more, and Hyundai is rapidly gaining on everyone."

"Everyone" is quite vague and the fact is that you can only go so cheap with a base price for any automobile before it starts to show on the product itself. As it stands right now, Hyundai may undercut Lexus in price (obviously) but the product of both is in no way equal. The biggest difference is that Lexus is offering EVERYTHING that the luxury brands are offering and then some for cheaper. As I've stated before, Hyundai and Lexus are not analogous. Right now, I don't even think the Veracruz offers everything the new Highlander does.

Agent009 - 6/27/2007 4:45:50 PMView My AgentSpace

+1 Boost

Not quite sure where you live, but I live in a metro area of over 5 million people in the southern US. And I rarely see anything other than older Japanese (due to the shear numbers) and lately and newer American cars on the side of the road.

I can't remember when I saw a Euro or newer Japanese car broken down down here.

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topneuro - 6/27/2007 3:26:59 PM

+1 Boost

GM ridicule Toyota and Datsun car makers in the 1960’s.
Mercedes and BMW did the same jokes for Acura, Lexus and Infiniti in the 1990’s.
Now Lexus is making fun of the Hyundai in 2007’s.
Agree the next will be Hyundai hitting on the Chinese.
Famous last words or jokes?
Get a reality check.
Read “The World Is Flat” of T. L. Friedman

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Lexus - 6/27/2007 3:40:47 PM

+1 Boost

Yes, that why I says you cannot compare Hyundai to Lexus, Audi, BMW and MB right now. But in the future if their product keep improving they will be a force to be reckon with.

Lexus - 6/27/2007 3:31:56 PM

+1 Boost

Agent009, I definitely agree with what you have to says about Hyundai is copying Lexus play book. But the scary thing is that when the Chinese and India arrived they will join the bandwagon for sure.

I think it all good and fun for us consumer. More competition force our favorite auto company to make the best vechicles they can.

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BimmerFan - 6/27/2007 3:33:33 PM

-4 Boost

I saw a Veracruz today. I thought it was a Lexus. They look so similar.

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justbrown - 6/27/2007 3:45:15 PM

+7 Boost

Thank God formula1 decided to clear up this issue. Now that you've given us your verdict, there is no more need to discuss this further.

BimmerFan - 6/27/2007 3:45:28 PM

-4 Boost

Well 06GS300.... It would be easy. The valet would simply fetch my car for me. Who parks their own car anymore....oh, you I guess.

Lexus - 6/27/2007 3:43:01 PM

+4 Boost

O6GS300, LOL :-)

maybe if they says open sesame or open Ali baba if the door open, than it their BMW ;)

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Designer1 - 6/27/2007 3:54:46 PM

+3 Boost

Actually this thing in real life looks bad. I don't like the RX, but this thing is worst, and yet it doesn't come with a navi, and it cost too much for a Hyundai.

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M53R - 6/27/2007 4:07:47 PMView My AgentSpace

-1 Boost

06GS300

You should understand that the difference in reliability nowadays are very small. It is not like when you drive your german car it will break down and the engine will burn. The differences are very small. Even toyota started to have some issues, also look at honda.

I hope you understand...

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PlanB - 6/27/2007 4:16:54 PM

0 Boost

My wife and I actually considered this car as a purchase. We're about to have twins(already have a 5yr old) and she wants a smaller sized sporty crossover with three rows(minivans and traditional SUVs are out of the question)and it was between the Veracruz, 08' Highlander and CX-9. Right now I think the CX-9 has won us over but the fact that we even considered a Hyundai still blows my mind. I think they've come a long way as a car company.

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1970toyotamarc - 6/27/2007 5:35:18 PM

+6 Boost

You cant make the comparison that Hyundai is following the Lexus strategy. Lexus set out to be a luxury nameplate, so of course they targeted BMW and MBZ. Hyundai is a mainstream vehicle. People might choose a Veracruz over a HIghlander or Pilot, but no one is going to cross shop the RX and a Hyundai. This comparison is just marketing hype, like saying a WRX compares to a 3 series. The only ones of you that truly believe this are Lexus haters and bashers. But, if it will give you some comfort, go ahead and keep believing that a Hyundai can best a Lexus, while Lexus keeps chipping away at German luxury domination throughout the world.

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ThaR8Don - 6/29/2007 1:45:02 PM

-1 Boost

LexusAdmirer, you made this statement "Lexus is a luxury brand that has RELIABILITY and QUALITY down to a science since day 1. I don't believe the same can said for Hyundai. Hence, that that's why you can't use the "I would never pay for a Lexus if I could have a Mercedes" argument. You're comparing apples to oranges." Lexus was born from Toyota whom when they entered the car market here in the US could not make a decent car to save their lives. Hyundai started the same way however, recent consumer reports and JD Powers reports indicate they have evolved far beyond their humble beginings and the disposable car methods. You are very passionate about your brand of choice but need to look at the facts. Lexus has been steadily slipping from grace in reliability ratings. The LS460 is second to the Audi A8 and Mercedes S550. Lexus is Toyota and always has been. Hyundai may be making a slight mistake by not creating a seperate brand but it still can be done. Some people buy image and that is when Lexus will win that buyer others buy cars for the perceived value and safety and those Hyundai will win. Either way you obviously see them as a threat or you would not try to bash them and go only on perceptions. You would point out where Lexus truly was the better car but in this case it is not true so you can't go there. Don't get me wrong I don't think Lexus is in any immeadiate danger but down the road....... The signs are there!

mikeydred20 - 6/27/2007 6:13:44 PM

+4 Boost

Point blank there is no way someone would take this over the RX. Shit Hyundai is comapring theemselves to Lexus they have a lot to jump over this junk is not even better than the MDX. They need to stay in their league with Toyota and Honda even there they have alot of catching up to do.

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silent_power - 6/27/2007 7:15:12 PM

0 Boost

Omarrana :
"Hyundai aims Veracruz at Lexus RX: Underestimates US demand"

Among others... Since RX350 is already diminished by RX400h, I should consider that silly post just an imagination...

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huu76 - 6/27/2007 8:58:26 PM

0 Boost

Wake me up when Hyundai can compete on something else other than price, as well as something they designed themselves.

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Lexus - 6/27/2007 9:11:00 PM

+1 Boost

What next the Hyundai sportcar trump Ferrari and Lambo? Hyundai make a M3, M5, M6 killer LOL :) yeah right. Hyundai need to stop dreaming, consumer are that dumb. If Hyundai play in the premium brand, they need make a premium with a different name plate.

Imagine if someone up here make a post on how the Hyundai sport Beat the M3, we would have a different tone of voice for sure.

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mikeydred20 - 6/27/2007 9:47:14 PM

+1 Boost

I agree 100% , the name alone screams non luxury. I remenber the days of the old Excel. They also need to stop bitting other companies designs.

ctsang - 6/27/2007 9:19:28 PM

+2 Boost

did anyone care to visit a hyundai dealership and then compare it to a lexus dealership?

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2JZSoarer - 6/27/2007 9:58:06 PM

+2 Boost

I think if Hyundai wanted to really go after Lexus,they should start a full luxury brand from scratch,with a new name,the reason is because Hyundai established it self as an econo brand not a luxury brand..

What is up with Hyundai comparing the Azera against the LS460??

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kpaxx - 6/28/2007 11:07:28 AM

0 Boost

Lest you forget the toyota cressida! This is how lexus started.

xj13 - 6/27/2007 11:48:11 PM

-1 Boost

Hyundai are smart to target Lexus, they know it's crap and they can take em dowm.
Well done Hyundai eat them alive.................

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2JZSoarer - 6/28/2007 12:22:41 AM

+2 Boost

Show how much you know about cars,You probably have never driven a Lexus ,so why don't just shut your pie hole!!

2JZSoarer - 6/28/2007 12:23:44 AM

+2 Boost

Mistype: "Shows"

Lexus - 6/28/2007 1:03:38 AM

+1 Boost

xj13, let me guess! you just graduate from high school and your parents bought the a Hyundai Sonata/Kia Specrat and now you think it a Lexus, MB, Audi and BMW killer.

Have you been living in cave for the past 5 years? Lexus has been so successful that it Lexus model have been to compare to RR's, Bentley and the Maybach. Not only that, I belief or so they compare the new Lexus LS to a million dollar private jet.

DallasMR2 - 6/29/2007 1:07:14 PM

0 Boost

as much as i hate Formula's opinion of Honda, i really have to agree with him here. i wouldn't put Lexus in the same League as Mercedes or BMW let alone Bentley, RR, or Maybach...let alone a friggin private jet!! give me a break!

david999 - 6/28/2007 4:55:49 PM

+1 Boost

If anybody has to worry it would be BMW (X3), Mercedes (ML), and Land Rover L3).
They would more likely lose sales before Lexus.

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xj13 - 6/28/2007 8:51:48 PM

0 Boost

I'M CONVINCED ALL CHATS HERE BY LEXUS DONKEYS ARE PAID BY THE COMPANY. NO BODY CAN BE SO LOYAL TO A CAR SO BAD...........

Hey Lexus and LexusAdmirer,
A small note to let you know I truly HATE Lexus cars, they're the worst cars on the road........

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xj13 - 6/30/2007 12:44:15 AM

0 Boost

I hate lexus, full stop.

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EL34 - 6/30/2007 6:32:13 PM

0 Boost

Lots of folks can't afford the Lexus, but at least they know there's an alternative for less money :)

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zorbeeze - 6/30/2007 6:35:32 PM

0 Boost

First off, Lexus cars have gone up in price every year and now are just as expensive as the euros.
Secondly, Hyunday would of been better of creating a whole new entity to sell luxury cars. Unfortunately people are badge whores and buying a so called luxury car from the same "name" that sells something like an Accent will not sell.

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autopro - 6/30/2007 7:00:41 PMView My AgentSpace

+2 Boost

AS good as the honney day may be the rx350 is on its way out. The new rx will best everything again. Don't forget it takes millions sometimes billions ie. (ls460) to develop a new world class model. Their are not many players left to compete at this level. He who has the most money wins.

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DieselRules - 7/1/2007 9:16:19 PM

0 Boost

I've been saying for 10 years that if Hyundai keeps improving at the rate that they are, they could be tops (eventually).
It seems that they are still improving rapidly (faster than Lexus/MB/Audi?) who knows where they will end up.

"Too expensive for a Hyundai" ????? that's what everyone said when Lexus launched their cars....

Contrary to what you read here, not everyone is a brand snob. Some people can care less and shop for the best price on what suits their needs.

Next generation RX will spank it (as someone said) ???

More likely next generation Hyundai will spank the Lexus. Korea is on top of their game.

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