Why Kia doesn't need a premium brand

Sat, Dec 5 2015

Hyundai's creation of the Genesis luxury brand means it and fellow Korean brand Kia have finally hit the mainstream in the U.S. – as far as products are concerned Â– after nearly three decades of trying. Which is about as long as it took Toyota and Nissan to roll out Lexus and Infiniti, respectively. It's history repeating itself.

Genesis is supposed to be the way Hyundai's premium models get the respect they deserve, without carrying the baggage of a name associated with frugality. Hyundai has, in fact, built up a reputation over the last decade or so for cars that compete head-on with class leaders, rather than aim to be 90 percent as good for 75 percent of the price.

And because Kia shares a number of components with Hyundai, its vehicles have also steadily become not only better mainstream vehicles, but have continued to aim higher than their price points. Does Kia need to follow now in its parent's steps with a prestige brand to market its most expensive models?

I'm aware of the Kia K900, the company's deepest foray into luxury territory notably occupied by Lexus. Kia, however, has consistently been pushing this $60,000 full-size luxury sedan along with $0 down, low monthly payment lease deals. Turns out there really aren't many people looking for a full-size Kia luxury sedan. Or maybe they're just waiting to get it for $20,000 in a couple of years.

Consider the K900 and Genesis when I convince you Kia already makes upscale cars to rival those with premium badges. They just don't happen to be its most expensive model.

Shortly after Hyundai's announcement it would spin its luxury models off into the Genesis brand, I spent a few days with a 2016 Kia Sorento SXL. And I'm willing to call it a more convincing attempt to get people out of luxury cars than the K900.

Driving the Sorento is not an emotional experience. You feel parental driving it, thinking you might've forgotten to pick your kids up until you remember you don't actually have kids. But after settling into the nicely stitched and perforated leather seats, you respect its comfort, quiet and amenities. The headliner is soft, the stitching on the dash top is convincingly real and everyone is impressed by the sharp graphics on the touchscreen and the slick powered shade that reveals an expansive glass roof.

A Kia Sorento costing more than $46,000 sounds absurd until you wonder how much better an Acura MDX or Lexus RX350 is when those cost as much as $10,000 more. It's not just good for the company that 20 years ago could sell you nothing better than a Sephia LS with a cassette stereo, it's good Â– full stop.

I suspected, as you might as well, that this level of refinement was constricted to the top SXL models and their ambitious price tags. So I was surprised when I spent Thanksgiving on a 500-mile trip to and from Silicon Valley in a 2016 Kia Optima LX and found it surprisingly premium-ish. It had cloth seats, relatively small 16-inch wheels and lacked heated seats on the one morning you actually needed them on the coast of California. Yet for a shade over the $27,000 mark, it unexpectedly aimed higher. The 1.6-liter turbo four is smooth and gutsy, while the 7-speed dual-clutch transmission is one of the best of its kind Â–- when not left in Eco mode, mind you.

No, a Kia Optima wouldn't be my first choice for a midsize sedan (thank Honda and Mazda, Kia), but with leather and a sunroof it could be the most convincing reason not to purchase a Buick LaCrosse or Lexus ES.

But if an Optima LX has good interior quality and slick powertrain, how much better would a similarly sized "premium" Kia need to be? There probably isn't enough unfinished, exposed-grain wood trim in the world to justify the price difference.

A premium Kia brand would be less like a Toyota/Lexus relationship and probably more like a Honda/Acura one. A premium Kia would be better, but not enough to distance it from its mainstream offerings. The Acura TLX, for example, is a good car, but it's mostly a really good Accord. The Acura ILX, meanwhile, is overshadowed by the shockingly good 2016 Honda Civic that's roughly 20 percent less expensive. A premium Kia brand would be a tough sell.

The best thing Kia can do is elevate the prestige of its own brand, rather than creating a whole new one. And cars like the Optima and Sorento prove the brand already has some great ambassadors.

Marketing/Advertising
Hyundai
Kia
Luxury
brands

By Zac Estrada