Hyundai mulling new Lexus-fighting upscale crossover

Mon, 18 Aug 2014

The idea of Hyundai marketing a luxury automobile might have seemed ridiculous a decade ago, but that was before the Genesis sedan, Genesis coupe and Equus came along. Now that buyers seem more accustomed to the notion of an upscale Hyundai, the Korean automaker is said to be considering launching a luxury crossover to take on the likes of the Lexus RX and Cadillac SRX.

The report comes from our compatriots at Edmunds, who spoke to Dave Zuchowski, head of Hyundai's North American unit, who said that the project is not yet part of the company's plan, but that "it is something under consideration."

The last time Hyundai entered that territory was with the Veracruz (pictured above), a model that was sometimes compared to but ultimately failed to compete with the Lexus RX when it was sold between 2006 and 2011. The Veracruz was effectively replaced by the seven-passenger Santa Fe with which it shared its underpinnings. This new project being considered would similarly be based on the latest Santa Fe, and the challenge Hyundai is facing once again would be to position it as a sufficiently upscale product to warrant a premium sticker price.

As Zuchowski pointed out, the RX shares much with the Toyota Highlander, but Lexus has no trouble charging a premium for the RX – indeed, it's its most popular model – since they don't sit beside each other in the same dealerships. Since Hyundai has chosen against spinning off a separate luxury brand, it would have to create enough distance between the two to justify the luxury model's existence and asking price. To get there, it may have to at least spin off a more upscale sub-brand and showroom space to include the Genesis, Equus and new Veracruz - whatever name it ultimately carries.

By Noah Joseph