Hyundai is introducing its flagship model, Equus, to the North American market. As always, Hyundai has set its price tag much lower than its competitions. Since they do not have reputation and quality like Lexus, competitive price and 10-year, 100,000-mile warranty is their advantage. Have you ever wondered how Hyundai maintains its business and creates huge net profit? Here’s a clue. Equus will be sold around $56,000 to $60,000 for the base model and $63,000 to $67,000 fully loaded. In South Korea, base model starts at $67,000(which is equal to a fully loaded Equus in North America) and fully loaded at a whopping $110,000. Moreover, warranty in Korea is 4-year, 50,000-mile.
Hyundai has been exploiting its home market. They exploited the fact that South Korea’s car market is an oligopoly. Considering that Hyundai owns Kia, Hyundai possesses nearly 87% of the market. Hyundai treats domestic customers as sitting ducks. Currently, Hyundai might be happy with maximizing profitability through unreasonable pricing in the domestic market, but when FTA with Japan settles, Hyundai might face the risk of exiting the market. WATCH OUT!
Dear Hyundai,
It is time to surprise the North American market with a proper car. Proper meaning a car bought because of performance and quality rather than price and warranty.