BMW vs. Hyundai? Now this one interesting comparison that we never thought we would see. David Kiley at AOL Autos steps out of the usual boundaries and tackles this controversial subject, and one that will drive some heated comments from BMW fans.
Before we jump into this subject, let’s learn a bit more about Hyundai.
Some of the best-known Hyundai divisions are Hyundai Motor Company, the world’s fourth largest automaker by units sold and the world’s fastest growing automaker, and one of the Big Asian Four (with Toyota, Honda and Nissan). In 1998 Hyundai bought Kia Motors, another South Korean company and consolidated their spot in the Asian market.
Headquartered in Seoul, South Korea, Hyundai operates the world’s largest integrated automobile manufacturing facility in Ulsan, which is capable of producing 1.6 million units annually. The company employs about 75,000 persons around the world, Hyundai vehicles are sold in 193 countries through some 6,000 dealerships and showrooms worldwide.
Hyundai entered the United States market in 1986 with a single model, the Hyundai Excel. Initially well received, the Excel’s faults soon became apparent; cost-cutting measures caused reliability to suffer. With an increasingly poor reputation for quality, Hyundai sales plummeted, and many dealerships either earned their profits on repairs or abandoned the product. At one point, Hyundai became the butt of many jokes (i.e. Hyundai stands for “Hope you understand nothing’s driveable and inexpensive”) and even made David Letterman’s Top Ten Hilarious Mischief Night Pranks To Play In Space: #8 – Paste a “Hyundai” logo on the main control panel.
In response, the parent company of Hyundai began investing heavily in the quality, design, manufacturing, and long-term research of its vehicles. It added a 10-year or 100,000-mile (160,000 km) powertrain warranty (known as the Hyundai challenge) to its vehicles sold in the United States. By 2004, sales had dramatically increased, and the reputation of Hyundai cars improved. In 2004, Hyundai tied with Honda for initial brand quality in a survey/study from J.D. Power and Associates, for having 102 problems per 100 vehicles. This made Hyundai second in the industry, only behind Toyota, for initial vehicle quality. The company continued this tradition by placing third overall in J.D. Power’s 2006 Initial Quality Survey, behind only Porsche and Lexus.
In 2003, according to Consumer Reports, Hyundai’s reliability rankings tied Honda’s.
In 2006, J.D. Power and Associates’ quality ranking, overall the Hyundai brand ranked 3rd, just behind Porsche and Lexus, and beating long time rival Toyota. The brand overall is ranked much higher than the average industry and resale value continues to improve; a comparable 2003 Hyundai Sonata sedan ranks just $2200 below a similarly equipped Honda Accord, according to Kelley Blue Book Pricing 2006.
In 2006, the Hyundai Entourage minivan earned a five-star safety rating – the highest honor the National Highway Traffic Safety Administration bestows – for all seating positions in frontal and side-impact crashes. The Insurance Institute for Highway Safety also rates “Good” – its highest rating – in front, side and rear impacts. The IIHS (Insurance Institute for Highway Safety, United States), in fact, named the 2006 Hyundai Entourage and Kia Sedona a “Gold Top Safety Pick,” making the safest minivan ever tested.
In 2006, Hyundai was awarded ‘Top-rated 2006 Ideal Vehicle’ by Autopacific, Marketing research and consultancy firm for the automobile industry.
In 2007, Hyundai’s midsize SUV, the Santa Fe, earned the 2007 Top Safety Pick award by IIHS.
In 2007 at the New York International Auto Show, Hyundai unveiled its V8 rear-drive luxury sedan called the Concept Genesis to be slotted above the Azera in the Hyundai line-up. This concept will make its American debut in mid 2008. The Genesis reintroduced rear-wheel drive to the Hyundai range following a long period of only producing front-wheel drive cars.
In 2007 at the Los Angeles International Auto Show, Hyundai unveiled its second rear-drive concept car, this car, called Concept Genesis Coupe, will be Hyundai’s first sports car due to make its debut in early 2009.
In 2008, Hyundai Santa Fe and Hyundai Elantra were awarded 2008 Consumer Reports “top picks”. The magazine’s annual ratings, based on road tests and predicted safety and reliability are considered highly influential among consumers. The Hyundai Elantra was Consumer Reports’ top-ranked 2008 vehicle among 19 other compacts and small family cars, beating out the Honda Civic, Toyota Corolla and Toyota Prius.
In 2008, at the North American International Auto Show, the production version of the luxury and performance-oriented Hyundai Genesis sedan made its debut, dealerships will have the Genesis as soon as summer 2008. In 2008, at the New York International Auto Show, Hyundai debuted its production version of the performance-oriented rear-drive Hyundai Genesis Coupe.
In 2009, the Hyundai Genesis luxury sedan was named 2009 North American Car of the Year, the first for Hyundai. The Genesis has received a number of well-recognized automobile awards worldwide. It also won the 2009 Canadian Car of the Year after winning its category of Best New Luxury Car under $50,000. The Hyundai’s V8 Tau engine in the Genesis, which develops 375 hp (280 kW) on premium fuel and 368 hp (274 kW) on regular fuel, received 2009 Ward’s 10 Best Engines award.
In 2009, 6 models of Hyundai/Kia cars earned the Top Safety Award by IIHS, better than Nissan/Infiniti.
In 2009, Hyundai/Kia vehicles were named as “least expensive vehicles to insure”. Hyundai/Kia vehicles were the least expensive to insure and occupied the ‘top five’ least expensive slots, said Insure.com. Low rates tend to reflect a vehicle’s safety.
In 2009, According to the Environmental Protection Agency’s (EPA) fuel economy report, Hyundai is the most fuel-efficient automaker in America. Hyundai surpassed every major automaker—even Toyota and Honda.
In 2010, According to Consumer Reports reliability survey, Hyundai (including Kia) ranked 4th best automaker in US, ahead of Nissan. The ratings reflect the performance, comfort, utility and reliability of more than 280 vehicles that the magazine recently tested, according to the report.
So quick recap:
- Rear-wheel drive vehicles
- 10 years warranty
- Top Safety Awards
- High reliability ratings
- Fuel-efficient automaker
While Hyundai does not carry the premium automaker label, the above mentioned traits can certainly be found in BMW’s philosophy and lineup.
But are these good enough reasons to even dare compare the two automakers?
Madelyn Hochstein, owner, President and co-founder of DYG, Inc., a marketing intelligence firm that has long counted BMW as one of its clients, has advised the German automaker that the luxury car buyer has changed for good. “The financial crisis of 2008 has people not shunning luxury vehicles, but they are looking for greater value, and scrutinizing their purchases more closely than ever.”
BMW marketing chief Jack Pitney takes the advice seriously. “I think running scared is a good way to manage a brand… take nothing for granted, and focus on what your customers are doing and saying,” he says.
But does Pitney go so far as to be worried about Hyundai, in addition to longtime competitors Mercedes-Benz, Audi and Lexus? “BMW has never worried about leading in specific categories like horsepower, or having every feature. Our strength is in tying everything together into an unforgettable and industry leading driving experience, and that’s what we are focused on, no matter what the economy is doing,” says Pitney.
Pitney says BMW doesn’t want to lose that “brand energy.” It is somewhat telling, though, that for the 2011 model year BMW will sell a 740i that starts at $70,150, $12,000 lower than the entry-model 750i that was the starting point for 2010. That is, in part, for the fuel economy of the V6 versus the V8s in the up-market 7s, but also to give buyers a lower starting price point.
BMW is launching an all-new 5-Series sedan this summer, two years after Hyundai launched its $33,000 Genesis sedan, which the Korean company modeled after the outgoing 5-Series. Autoblog, a sister site of AOL Autos, noted at the Genesis launch in 2008: “In one breath, the Genesis will simply compete head-to-head with the Infiniti M, Lexus GS, Lexus ES, Acura TL, and Acura RL [while] the German buyers want their badge; the American customers are true to their flag.” Indeed, few were willing to say that Genesis had hit the BMW Roundel bulls-eye on the first try. (Or second, if you will: Hyundai’s Veracruz SUV, costing roughly $37,000 loaded, was launched for the 2007 model year. Its only shortcoming when compared to its luxury competitors has been slow sales.)
So, can we have that conversation? Hyundai vs. BMW. This is how it would go?
Hyundai Genesis Sedan vs. 2011 BMW 5-Series
Appeal: The J.D. Power and Associates APEAL survey asks car buyers to rate how pleased they are with their vehicles, from styling to interior design execution, over 90 factors in all. In the 2009 APEAL Genesis topped the 5 Series.
Power: Both are available with six- or eight-cylinder engines. 290 hp for the V6 Genesis versus 300 hp for the turbocharged, six-cylinder BMW. 385-hp for the V8 Genesis versus 400 hp for the turbocharged V8 BMW.
Price: The 3.8-liter Genesis V6 starts at $33,000, while the 535i starts at $49,600.
Extras: Both the 5-Series and Genesis get 3-star ratings from Automotive Leasing Guide for resale value.
Bottom Line: This all depends on how much fifteen grand is worth to you. The Genesis is a fine machine. But where BMW excels is the integration of all the parts into one spectacular day-to-day driving machine. Plus, the 2011 5-Series design is a sleeker, more traditionally taut design than the outgoing model. The Genesis seems to have a clearer advantage over the $45,600 Lexus GS350 whose ride and handling is closer to that of the Genesis.
Advantage: BMW, but not by as wide a margin as you might have thought.
2011 Hyundai Equus vs. 2011 7-Series
Appeal: We’ll just have to wait for these results.
Power: The Equus has a 4.6-liter V8 that generates 385 hp, versus 315 for the base Bimmer with a 3.0-liter, turbocharged 6-cylinder.
Price: The Equus is expected to sticker at $50K-$60K. This is right in the middle of 5-Series territory. But the 2011 BMW 740i starts at $70,150 and stickers at $82,000 when typical popular features were added.
Extras: Said Autoblog at the debut of Equus: “If Hyundai ever decides to gamble and attack the next price segment up from the Genesis sedan, they clearly have the ammo to do so. The Equus is the real deal.”
Bottom Line: Hard to give an advantage when the Equus isn’t here yet. But getting what is believed to be a great, luxurious car that’s this well detailed, and for about $30,000 less than the comparable 7-Series? That has our attention.