Hyundai courts brand prestige with Hermes model makeover
By Hyunjoo Jin
SEOUL (Reuters) - South Korean carmaker Hyundai Motor Co hopes a touch of Hermes will make its priciest sedan as desirable as the French retailer's exclusive handbags and catapult its cachet into the same league as luxury European rivals.
Hyundai Motor Group ranks fifth among the world's top-selling cars, but the company wants to shed its value-for-money image and start charging premium prices to counter growing competition at home from BMW, Audi and Mercedes as well as mid-range models by rivals such as Ford Motor Co.
Hermes, makers of the coveted Birkin and Kelly handbags that start at around $9,000, remade the interior of three, not-for-sale Equus models that will be showcased at the Seoul motor show from Thursday. The tie-up comes two years after an attempt to sell Prada-designed cars failed to draw customers.
"The model is aimed at improving brand image," Cho Won-hong, Hyundai's chief marketing officer, told reporters. Luxury group LVMH owns a stake in Hermes, which used its signature leather and equestrian-inspired logo in the Equus, named after the Latin word for horse.
Hyundai and affiliate Kia Motors Co are fighting to maintain market share after the government implemented free-trade agreements with Europe and the United States. Imports accounted for 10.1 percent of car sales in South Korea in 2012, about 10 times more than a decade ago.
LUXURY BY ASSOCIATION
In 2011, Hyundai commissioned Italian luxury fashion house Prada SpA to co-design a limited-edition line of Genesis sedans intended to compete with Mercedes and BMW in its affluent home market.
The initiative flopped. Hyundai sold just a third of the 1,200 cars it had initially targeted, highlighting the depth of what the company itself calls an image problem. Continued...