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bassexpander
Joined: 13 Sep 2007
Location: Someplace you'd rather be.
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 Posted: Fri Aug 22, 2008 4:57 pm Post subject: Locals upset Hyundai Genesis costs nearly half in the US |
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http://english.yonhapnews.co.kr/business/2008/08/07/11/0503000000AEN20080807004700320F.HTML
Import it legally, and you not only save 13 million won after taxes -- you get a 10 year -- 100,000 mile warranty that you don't get in Korea:
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When Hyundai Motor Co. debuted its new rear-wheel drive Genesis luxury sedan earlier this year, executives there were hoping to find a way to penetrate the luxury auto segment of the United States.
Nearly seven months later, however, Hyundai is facing a new headache at home as South Korean consumers have become increasingly aware of the fact that they have to pay 40 percent more for the Genesis sedan than American consumers.
Hyundai, which controls over 75 percent of the domestic market along with its affiliate Kia Motors Corp., sells the 3.8-liter Genesis for 58.3 million won (US$57,000) in Korea, whereas in the U.S. it sells for $32,000.
That's good news for grey importers, who import goods legally but without the consent of the manufacturer, as well as S. Korean consumers.
Even excluding the nation's punitive car-import duties, engine-displacement taxes and shipping costs, a Korean customer can save as much as 13 million won if he or she purchases a Genesis sedan that has been reimported to Korea from the U.S. market, auto importers say.
In addition, local buyers of models shipped back from the U.S. will benefit from Hyundai's 10-year, 100,000 mile warranty, which is only offered in the U.S., not Korea.
"As for Korean consumers, they could save big money if they buy the Genesis after it has been reimported from the U.S.," said Choi Jae-woo, a grey importer in Seoul.
Choi said he receives dozens of telephone and online queries a day from potential customers.
Since Hyundai announced details of its U.S. price range for the Genesis in May, disgruntled South Korean consumers have been abuzz with chatter on Internet sites about ways to reimport the vehicle from the U.S.
While there is no official data on how many of the sedans were reimported from the U.S., a TV news report on Tuesday by MBC, one of the nation's three major national broadcasters, revealed that one grey importer sold 40 of the vehicles to local consumers this month after buying them at American showrooms.
Amid rising consumer complaints, Korean anti-trust regulators are also investigating whether Hyundai and Kia have abused their domestic market dominance by charging higher prices at home.
An official at the Fair Trade Commission declined to comment, citing the ongoing probe. Officials at Hyundai's public relations team in Seoul weren't immediately available for comment.
Since entering the American market more than two decades ago, Hyundai has successfully raised its quality and consumer acceptance by offering generous warranties and affordable prices.
Still, critics say Hyundai's success in the U.S. market comes at the expense of South Korean consumers, who are being forced to pay higher prices than their American counterparts.
Hyundai was generating a profit margin of some 10 percent on the Korean-built cars, compared with just two percent for the same vehicles built in the U.S., according to industry analysts.
"With those kinds of margins to extort from Hyundai, it's no wonder the Hyundai Motor labor union desperately opposes open markets and the Korea-US Free Trade Agreement," said Brendon Carr, an American lawyer who has been working as a foreign legal consultant in Seoul for over 10 years, on his blog.
Hyundai's 45,000-strong union vigorously opposed a free trade deal signed by South Korea and the U.S. last year, which will cut car taxes and other non-tariff barriers on automobiles.
Hyundai began selling the Genesis sedan in the U.S. market last month. However, U.S. customers have given the new sedan a lukewarm response, with only Hyundai 649 models sold, according to the company data.
In comparison, Hyundai's domestic sales of the Genesis sedan averaged some 4,000 units each month for the first half of this year. |
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mindmetoo
Joined: 02 Feb 2004
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| Posted: Fri Aug 22, 2008 6:10 pm Post subject: |
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| But don't Koreans believe Korean chaebols so love Korean consumers that they export the crap and keep the best quality for Koreans. Hence the higher price? |
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cdninkorea
Joined: 27 Jan 2006
Location: Seoul
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| Posted: Fri Aug 22, 2008 7:09 pm Post subject: |
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| I wonder if they'll blame America (or failing that, Japan) for this. When there's a will... |
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Guri Guy
Joined: 07 Sep 2003
Location: Bamboo Island
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| Posted: Fri Aug 22, 2008 7:34 pm Post subject: |
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| But don't Koreans believe Korean chaebols so love Korean consumers that they export the crap and keep the best quality for Koreans. Hence the higher price? |
Just a continuation of the Yangban screwing over the Korean people for centuries. The Yangban heavily collaborated with the Japanese occupation to keep their power and used their wealth to start the chaebols. So this is nothing new under the sun.
It's kind of funny that they'd also believe that the USA would export all their crap beef to South Korea and keep the best quality for themselves isn't it?  |
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ulsanchris
Joined: 19 Jun 2003
Location: take a wild guess
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| Posted: Sat Aug 23, 2008 1:28 am Post subject: |
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| mindmetoo wrote: |
| But don't Koreans believe Korean chaebols so love Korean consumers that they export the crap and keep the best quality for Koreans. Hence the higher price? |
The common belief is that Korea exports the good stuff and sells the crappy stuff to koreans. |
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DCJames
Joined: 27 Jul 2006
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| Posted: Sat Aug 23, 2008 3:10 am Post subject: |
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Koreans choose to screw themselves when they buy Korean-made products simply because they're Korean-made. Forget quality, features, and prices as factors for buying something.
This is their way of showing patriotism and support for Korea.  |
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Whirlwind
Joined: 03 Jun 2005
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| Posted: Sat Aug 23, 2008 3:21 am Post subject: |
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| So true. I don't have any sympathy for them. I've had countless Koreans tell me that the more expensive something is, the better the quality. In fact, one of my ex-supervisors proudly told me how Korean is fast becoming an expensive place to live. I guess that they feel like their on par with Japan in terms of how expensive things are. Until they break this Korea-or-everything-else-is-inferior thinking and open up the country to competition(no likely), I expect that it will become more expensive in Korea. |
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wylies99
Joined: 13 May 2006
Location: I'm one cool cat!
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| Posted: Sat Aug 23, 2008 3:24 am Post subject: |
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| I've had countless Koreans tell me that the more expensive something is, the better the quality. |
Right. I've heard it, too. They assume higher prices equal better quality. |
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yingwenlaoshi
Joined: 12 Feb 2007
Location: ... location, location!
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| Posted: Sat Aug 23, 2008 3:25 am Post subject: |
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| A little off topic, but when does the Dokdomobile come out? |
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mindmetoo
Joined: 02 Feb 2004
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| Posted: Sat Aug 23, 2008 4:09 am Post subject: |
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| DCJames wrote: |
Koreans choose to screw themselves when they buy Korean-made products simply because they're Korean-made. Forget quality, features, and prices as factors for buying something.
This is their way of showing patriotism and support for Korea. |
I see the angle. Their patriotism is rewarded by the chaebols passing the savings on to the evil Americans! Clearly the chaebols are in the grips of America.
Koreans. Want cheaper Korean cars. Free trade. |
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Kiarell
Joined: 29 Mar 2008
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| Posted: Sat Aug 23, 2008 6:09 am Post subject: |
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Whatever, cars suck. Just senseless fetishism and consumerism. They're a necessarily evil, though, back in the states, until we get public transit running again.
Anyhow, protectionism was important to get Japanese car manufacturers off the ground and they just happened to perform better in every way (quality and management and worker abuse) down the line. I wonder if they had such high prices though? I would think the strategy would be to tax import cars and then subsidize national car companies. I guess the govt and jaebeols found out that nationalism, keeping the masses ignorant, locking out competition, and jacking the prices through the roof is even better.
I'l never forget my stupid co-teachers oohin and aahing over some shit Ssangyong tinted, black, boxy, 8km/L shit sedan priced at the reasonable 50 Million won. I tried to tell them that at price you could get a luxury German sedan and that Korean cars are currently a laughing stock. The only reason they sell abroad is because they're slowly getting better, (the exported ones) have better mileage than USA cars, and are cheap. Just imagine if they ever saw a Lamborghini. Now imagine telling them it's Italian. |
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mindmetoo
Joined: 02 Feb 2004
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| Posted: Sat Aug 23, 2008 11:45 am Post subject: |
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| Kiarell wrote: |
Whatever, cars suck. Just senseless fetishism and consumerism. They're a necessarily evil, though, back in the states, until we get public transit running again.
Anyhow, protectionism was important to get Japanese car manufacturers off the ground and they just happened to perform better in every way (quality and management and worker abuse) down the line. I wonder if they had such high prices though? I would think the strategy would be to tax import cars and then subsidize national car companies. I guess the govt and jaebeols found out that nationalism, keeping the masses ignorant, locking out competition, and jacking the prices through the roof is even better.
I'l never forget my stupid co-teachers oohin and aahing over some shit Ssangyong tinted, black, boxy, 8km/L shit sedan priced at the reasonable 50 Million won. I tried to tell them that at price you could get a luxury German sedan and that Korean cars are currently a laughing stock. The only reason they sell abroad is because they're slowly getting better, (the exported ones) have better mileage than USA cars, and are cheap. Just imagine if they ever saw a Lamborghini. Now imagine telling them it's Italian. |
Protectionism doesn't always work to incubate an industry. The Brazilians had protectionism on computers back in the 1980s and early 1990s. Bringing a PC into the nation was not possible without a vast amount of paperwork. Brazil isn't exactly a powerhouse today.
A better way is doing the grunt work cheaper and then moving up the value chain. First you're soldering chips to motherboards and then eventually you're making the chips and motherboards. |
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Temporary
Joined: 13 Jan 2008
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| Posted: Sat Aug 23, 2008 12:16 pm Post subject: |
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| I've ridden in some of these luxury cars in Korea, they are awful. My parents own a Cadilac STS and a Lexus back home and its night a day difference.. |
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Cheonmunka
Joined: 04 Jun 2004
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| Posted: Sat Aug 23, 2008 1:33 pm Post subject: |
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In 1994 my bro in law bought a New Grandeur. It cost 25 mill then. That was a lot of dough then. Now it's a dong car worth less than one mill.
Anyway, I did some research and found that this car is the exact replicant of a Mitsubishi Debonair. I couldn't believe it. The Debonair, which doesn't sell in NZ but was pretty much equal in stature as a sold in NZ model that was new off the line for eight million. That's three times more cost to buy domestically. What a rip off!
As for the Genesis I was pretty shocked by the tag. When it first came out I thought, '25-30 mill.' It might be based on a BMW 5 series, but it ain't BMW; it's soft and less strong ... But looky, what is it, 55 mill or so? That's just shocking. |
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madoka
Joined: 27 Mar 2008
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| Posted: Thu Nov 06, 2008 2:16 am Post subject: |
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| Cheonmunka wrote: |
In 1994 my bro in law bought a New Grandeur. It cost 25 mill then. That was a lot of dough then. Now it's a dong car worth less than one mill.
Anyway, I did some research and found that this car is the exact replicant of a Mitsubishi Debonair. I couldn't believe it. The Debonair, which doesn't sell in NZ but was pretty much equal in stature as a sold in NZ model that was new off the line for eight million. That's three times more cost to buy domestically. What a rip off!
As for the Genesis I was pretty shocked by the tag. When it first came out I thought, '25-30 mill.' It might be based on a BMW 5 series, but it ain't BMW; it's soft and less strong ... But looky, what is it, 55 mill or so? That's just shocking. |
1. Name me a mass-produced car that doesn't depreciate to next to nothing in FOURTEEN YEARS. My friend's 1996 Mercedes S-Class depreciated almost $100,000 in the past 13 years. Hell, my own car has depreciated $15,000 THIS YEAR. 
2. Looks like the Debonair sold for basically the same price as the Grandeur. Don't know where you're getting 8 million from. Doesn't sound even close.
http://www.cars-directory.net/specs/mitsubishi/debonair/1994_10/
3. I've read quite a bit of the American reviews of the Genesis. The consenus is that it is a game changing car and a great value even at MSRP. You can't just eye-ball a car and assume it should be priced that way simply because it's a Hyundai. |
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