Hyundai/Kia's Luxury Problem

"Tom McParland" (tommcparland)
11/25/2013 at 10:01 • Filed to: Customer Service, Cotomer Sevis, Hyundai, Kia, Car buying, Stealerships, Automatch Consulting, articles

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Hyundai/Kia has made it no secret that they want to play in the US luxury market. The Genesis, Equus, and now K900 sedans may not be stealing BMW and Benz buyers, but those vehicles show that the focus and resources are present to make an impact on this segment in the near future. However, product alone is not going to determine success in this playing field.

My issue is not with Hyundai/Kia's product offerings, I for one am willing to give them the benefit of the doubt that it takes time to build a serious luxury offensive against the Germans. Lexus did not make it into that league overnight. Rather, my issue is with Hyundai/Kia's dealer experience.

As most of you know, I am a professional car-buying consultant. Essentially, I collect a modest fee to make vehicle recommendations, shop, and negotiate on behalf of a customer. Within the past few years I have put Hyundai/Kia on the shopping list of several customers. Many times, I was met with skepticism when, for example, I suggested they test-drive the new Elantra/Forte if they were shopping for a Civic. However, after the test drive the customer changed their mind about Hyundai/Kia being that "budget brand with the long warranty." Unfortunately, almost all of those customers that considered a Hyundai/Kia ended up with a different brand mostly due to their or my interaction with the dealership.

When I contact a luxury car dealer the usual reception I get is of cooperation and an enthusiasm to develop a positive business relationship. Sure there have been luxury car dealerships that didn't want to give me the time of day, but it doesn't happen often. What does happen often with Hyundai is a tone of suspicion and an unwillingness to get me the information I need to close a deal.

Here is a typical phone/email conversation I will have with a German brand car dealer-

"Hello I am Tom with Automatch Consulting. I have a client looking to lease a (insert SUV here) with leather, navigation, sunroof, and AWD. They have 3500 for a deposit and would like to lease for 36 months, 12k miles a year."

Salesperson- "We have 4 vehicles in our inventory, in several different colors. Attached is a window sticker for one of the cars with the breakdown of the lease pricing. Of course if they want specific colors or different equipment let me know, and I will find something else."

If this is an email conversation it usually happens within a matter of a few hours.

Here is an example conversation that I have had with several Hyundai or Kia dealers:

"Hello my name is Tom I am with Automatch Consulting. I have a client looking to lease a (insert SUV) with leather, navigation, sunroof, and AWD. They have 3500 for a deposit and would like to lease for 36 months, 12k miles a year."

Salesperson- "Without a specific vehicle we cannot give you pricing you would have to look at our inventory.

"I checked your inventory but the way your website displays it I cannot determine which vehicles are of a specific trim level nor can I see what equipment they have. Do you have access to a more detailed inventory and can suggest a vehicle in stock with the equipment I need?"

Salesperson- "In order to best determine what car a customer wants they really should visit the dealership for a test drive."

"My client already has test driven the vehicle and knows what trim and options she wants, at this point we are looking to see if you have such a vehicle in stock and what you can offer as a competitive lease."

Salesperson- "We normally don't discuss lease pricing over the internet. But if your client comes to our dealership we will give them the best deal."

"My client will be driving over an hour to visit your dealership. Your competing brand's dealerships have all given me their most competitive price via email. I am confident you can offer us a good deal, and encourage my client to take the drive to your dealership."

This email conversation usually happens over a few days. Normally after that last email, I don't get a response.

I understand that having a "consultant" contact a dealership can be strange for some. And perhaps luxury car dealerships are more accustomed to dealing with wealthy customers so it does not seem out of the ordinary to have someone else do the shopping/ negotiating. However, I think for so long Hyundai/Kia has been catering to a clientele that was not as "savvy," so it seems they have an archaic approach to dealing with this new type of car-buyer. But times have changed, and Hyundai/Kia's product has changed. What these dealerships fail to realize is that every time they are uncooperative it makes me less likely to put a Hyundai/Kia on a client's shopping list and more likely to push a brand that still offers a quality product but also facilitates a better sales model.

So if Hyundai/Kia really wants to play in the luxury car market, they need to start focusing on knowledgeable salespeople (I can do an entire post on Hyundai/Kia sales staff's lack of product knowledge) and a responsive internet sales team. !!!error: Indecipherable SUB-paragraph formatting!!! it is the brand's philosophy towards the car buying experience that often dictates management's approach. No car-buyer wants the run-around on pricing and availability, luxury car buyers have even less tolerance.

!!! UNKNOWN CONTENT TYPE !!!

My name is Tom and I run !!!error: Indecipherable SUB-paragraph formatting!!! I am a professional car-buying consultant, which means people pay me to help them select the right car (NO YOU CAN'T HAVE A PRIUS) and negotiate with the dealerships to get them the best price. If you have any other questions or suggestions for future posts about the car-buying process please let me know. You can find some of my other posts on car-buying !!!error: Indecipherable SUB-paragraph formatting!!!

You can also find me !!!error: Indecipherable SUB-paragraph formatting!!! and !!!error: Indecipherable SUB-paragraph formatting!!!

(Equus photo via Car and Driver. K900 photo via EGMcartech. Genesis R-spec photo via MotorTrend)

DISCUSSION (100)

davedave1111 > Tom McParland
11/25/2013 at 10:08

Have you discussed this with Hyundai/Kia themselves, instead of independent dealers? I'd call their regional VP of sales or whoever, and make him aware that the shop-floor salesmen are repeatedly and consistently refusing to sell you cars. I wouldn't imagine he'd be too happy to hear that.

davedave1111 > Tom McParland
11/25/2013 at 10:09

ncasolowork2 > Tom McParland
11/25/2013 at 10:11

Well written. Should get cross-posted to the front page.

It saddens me to see such pathetic levels of service involved in a major life purchase. I feel like I should be hired by these dealerships to teach service. Wonder if I could double their sales if their salesmen are this pathetic.

Tom McParland > ncasolowork2
11/25/2013 at 10:13

Thanks, though Matt tends not to re-post my stuff to the FP where I mention my business. I think he could get into some sticky stuff with the Gawker higher ups regarding advertising and such. So I totally understand.

Tom McParland > davedave1111
11/25/2013 at 10:13

I will drop them both a line later, thanks.

ncasolowork2 > Tom McParland
11/25/2013 at 10:18

You could just edit out the name of the business and simply mention what you do.

Grindintosecond > Tom McParland
11/25/2013 at 10:24

Agreed. There is a level of expectation that comes with a level of luxury. I do not mean product. Hyundai/Kia have yet to meet that expectation of the customer experience. I once sat next to a short old guy on a flight. He had a huge gold and black ring with '#1' in diamonds on the face. In conversation I learned he was the former head of the pipe fitters union and that was his retirement gift. That huge diamond encrusted ring. Every year on the same date he appears at the Cadillac dealership and drops off the keys of his previous year model Caddy and gets in and drives away in the new model year Caddy...EVERY year same exact day. they are expecting him. Of course he probably phoned ahead about the color but that is service of a luxury brand.

When will Hyundai/Kia understand that level is required if they really want to push into this market at a level beyond that of Buick?

Slave2anMG > Tom McParland
11/25/2013 at 10:24

I doubt their dealers will give a crap...they're too busy shooting commercials standing in front of a mess of cars yelling "prices won't be beat" at the top of their lungs. They're about selling a lot of (relatively) inexpensive cars, not a few expensive cars. That was the genius of Lexus - getting that customer into the high end environment that they expect...and the failure of VW with the Phaeton where they didn't do that. Hyundai needs to learn from the Lexus model, not the VW model...

ADabOfOppo; Gone Plaid (Instructables Can Be Confusable) > Tom McParland
11/25/2013 at 10:24

Well said.

It still amazes me that car buying for the majority of people in the US is still approached by dealers like they are Smaug, hoarding a immeasurably vast treasure trove, and they think of the customers as filthy little Hobbits sneaking about trying to steal something.

I exaggerate, I know. But, it's not that far from the truth it seems.

The best car buying experiences happen when both parties understand both have specific knowledge of the product and treat each other with polite respect. When both sides view the sale as a negotiation where both parties compromise a little to get everyone a good price, it makes everyone feel like they've won.

Now, the fact that everyone has to pay a different price for exactly the same thing is another very large soap box I won't step up to today.

Tom McParland > ncasolowork2
11/25/2013 at 10:25

I don't put my business name in there, just that is what I do. I would edit it out but I feel it is a necessary mention for the piece.

ncasolowork2 > Tom McParland
11/25/2013 at 10:28

"Tom with Automatch consulting" I figured Automatch consulting was the name of the business.

Tom McParland > ADabOfOppo; Gone Plaid (Instructables Can Be Confusable)
11/25/2013 at 10:29

I think the LOTR/Hobbit reference is spot on. Both sides are stuck in old ways of thinking.

Tom McParland > ncasolowork2
11/25/2013 at 10:33

Right...derp. Usually I don't mention my business name, this was a unique post. Anyway, I'll leave it, if Matt really wants it and asks for an edit, I will be happy to oblige. I also got FP'd last week and I think he likes to give other folks a shot. :)

KusabiSensei - Captain of the Toronto Maple Leafs > Slave2anMG
11/25/2013 at 10:39

And now you perfectly lead me into one of Sensei's Sage Sayings:

"The louder the commercial, the dumber they think you are."

Tom McParland > KusabiSensei - Captain of the Toronto Maple Leafs
11/25/2013 at 10:41

Hahaha! That is awesome. I am totally going to steal that line. :D

KusabiSensei - Captain of the Toronto Maple Leafs > Tom McParland
11/25/2013 at 10:47

Good artists imitate.

Great artists steal.

KusabiSensei - Captain of the Toronto Maple Leafs > Tom McParland
11/25/2013 at 10:58

This is the precise reason my grandfather bought a Toyota Avalon over a Hyundai Genesis.

The freaking dealer.

And Hyundai isn't large enough yet to have multiple dealers in close proximity. So you couldn't drive within a 30 minute radius and hit 4-5 dealers, like you used to be able to do with Ford (and sometimes are still able to do, depending on geography). So if you are stuck with a crappy dealer, you tend to write the whole marque off.

It's one of the core tenets of business: The people your customers interact with ARE THE WHOLE BUSINESS. It doesn't matter if you have insanely great products, if you screw around with your customers, they won't be your customers for very long, if at all.

With franchised dealers, it's more complicated (Manufacturer sells to dealers, dealers sell to consumers, sometimes there is a distributor between the manufacturer and the dealer).

But not to the customer! The dealer, to them, IS the manufacturer. If the dealer jerks them around, then the end result is "Don't buy X make of car, their dealer sucks", even if the recommendation is going to someone who would have a different dealer.

And those recommendations (which aren't coming from car enthusiasts, mind you) tend to hold a lot of water.

Every Single Freaking Sale to a customer is a PR event for the dealer, and the manufacturer. Even if the customer does not buy a car from them, they should walk away with the feeling that they were dealing with stand-up people.

If you don't, and act like Smaug (as noted elsewhere in the comments), things get bad. Fast.

Tom McParland > KusabiSensei - Captain of the Toronto Maple Leafs
11/25/2013 at 11:01

Well said!

Tom McParland > ncasolowork2
11/25/2013 at 11:19

Well, there goes that theory. The mystery of the Hardibro strikes again.

StevenG > Tom McParland
11/25/2013 at 11:23

Just try and get a specific car out of them.

I was just in the market for a smaller hatchback. I wanted to at least try a Forte5 MT. I was basically told to buy the smaller Rio. They made no effort to order or find the car I wanted. They did not want to work for the sale and had no interest in selling anything not on the lot that very moment. I told them I was even willing to wait 3-6 months.

bfisch1629 > Tom McParland
11/25/2013 at 11:25

I was recently put off on the brand(s) while car shopping and not being able to even see MSRP on their websites. It all said I had to come in to the dealership. No thanks!

Arch Duke Maxyenko, Shit Talk Extraordinaire > Tom McParland
11/25/2013 at 11:26

And here I thought that their problem was the bland looking cars...

bfisch1629 > Tom McParland
11/25/2013 at 11:28

also this: http://jalopnik.com/5897921/would-…

isnewton > Tom McParland
11/25/2013 at 11:31

I did not know you were a car buying consultant that sounds like a cool job. I have always been interested in things like that. I think one of the issues at these car dealerships is perhaps Kia/Hyundai doesn't want someone 100% knowledgeable about the car selling atmosphere to find a car for someone, cause that prevents them from maximizing profit?

That's just my theory anyways. Most car buyers are not aware of how to haggle with car salespeople. You never take their first offer. When in doubt, shop around.

StevenG > Tom McParland
11/25/2013 at 11:32

Both sides?
How is the customer stuck in an old way of thinking?

I recently bought a car. I at first was very excited by all the "build your car" websites. Then I realized none of those have any point. You can't build your own car. All you can do is visit dealer websites, pray for the best, and go to the dealership to find out the car you want has been sold or they don't want to sell it to you.

There is a ford dealer around here who does this all the time. They send out an advertisement for a car they bury in the lot. You can't drive it and they like it that way. Then they try to sell you a used model or something with more options, or a sedan instead of a hatch. They will make up every reason to not let you buy that car.

I want to be able to design my car, test drive something similar at least the same transmission and engine, and then have the car built and delivered. In an age when I buy mustard from amazon, stuff I liked as a child in a foreign country, there is no reason cars can't be like this too. Heck, one car brand already does this.

Tom McParland > isnewton
11/25/2013 at 11:34

That is exactly why they give me the run-around. These dealerships are notorious for old-school dealer tricks to get the most possible out of the customer. If I do have a customer deal with them, that client goes to the dealer and I am just a phone call away. I love it when the salespeople try to pull something, the client calls me and they can back them into a corner. I feel good and the client feels like they have the upper hand. Of course this level of hassle is something I like to avoid.

55_mercury > Tom McParland
11/25/2013 at 11:34

nevermind...

StevenG > isnewton
11/25/2013 at 11:35

There is a simple solution for that problem. Sell cars for a fixed price. It would of course be lower than the current joke MSRP.

For Sweden > Tom McParland
11/25/2013 at 11:36

The fact that you can make a living as a car buying consultant already speaks volumes about the car buying experience.

philaDLJ > Tom McParland
11/25/2013 at 11:37

It seems Hyundai Corporate doesn't want potential or current Equus buyers anywhere near local dealerships. That's why they have the Concierge program. Of course, that still means Hyundai wants to work directly with the customer and "build a relationship"; Concierge doesn't quite work when dealing with a go-between/consultant.

The K900 preview page on kia.com doesn't specify whether something similar to Hyundai Concierge will be employed to sell K900s, but I'd be very surprised if they didn't, as Kia dealerships in my experience are an even more inappropriate place to conduct luxury car transactions than Hyundai.

Tom McParland > StevenG
11/25/2013 at 11:37

When I mean "both sides" I don't mean all car buyers folks visiting this website are more knowledgeable than the masses. What I mean is that often customers think this is going to be a drawn out battle, when in fact there are dealerships out there (mostly high-end ones) that are getting smart and offering low ball prices off the bat in order to make a quick sale.

RacecaR > Tom McParland
11/25/2013 at 11:37

This is a little disheartening. Hopefully my local Hyundai dealer is not like this. I may be in the market for a new daily within the next year or so, and I have considered putting a Hyundai on that list.

But there is a local dealer that handles Porsche/BMW/Mercedes/VW/Nissan that is just HORRIBLE!. My buddy bought a VW GTI a year or so ago. He test drove a GTI locally, then drove nearly 2 hours to another VW dealer to buy one. The sales people there act like they are being bothered to help sell you a car. If I had all the money in the world, and they had the exact car I wanted, I would go else where, or go without before them getting any of my money.

Dolemite > ADabOfOppo; Gone Plaid (Instructables Can Be Confusable)
11/25/2013 at 11:39

It's gotten that way with many companies, not just car companies. They treat customers as if they are some kind of thieves, attempting to steal their car/software/music/television show, etc. They make it as onerous as possible to buy their product, punishing people to the point they find the product elsewhere, or simply don't buy it.

Tom McParland > For Sweden
11/25/2013 at 11:39

In fairness I don't actually "make a living" doing this, it is a part time gig. However, if more customers in my area knew about my services that might change.

Zoom > Tom McParland
11/25/2013 at 11:40

Absolutely correct. Some of what you attribute to unwillingness to divulge information stems from the fact that these bottom end retailers prey on the emotions that a buyer reflexively has when experiencing a product close up. They make a couple extra bucks with the reflexive knee-jerk buyer. The buyers you are used to dealing with, by their very nature, have contacted you because they would rather forgo all of the preliminary bullshit and just buy a car for the right price. They have already overcome or are not effected at this point by emotion-based buying. They just don't want to get gouged, and don't have the time or the patience to haggle with a dealer.

These retailers haven't learned that yet, and may never do so, since premium level retailing is such a small parrt of what they do. And as such may never bother to train any sales consultant to what is expected.

KirkyV > StevenG
11/25/2013 at 11:41

Well, you could move to Europe. The system you describe is exactly how it works here.

(It might be a little tough to justify moving halfway across the world for the sake of a more sensible system of car purchasing, though.)

Triborough > Tom McParland
11/25/2013 at 11:42

So the takeaway from this is that dealers are the problem.

Tom McParland > Zoom
11/25/2013 at 11:42

Yup...and that is exactly my point. If Hyundai/Kia really want to play in this game they need to purge their dealership management of that mindset.

Collin > Tom McParland
11/25/2013 at 11:42

Please do a post about Hyundai/Kia salespeople's lack of product knowledge. I like to complain about that too. My dad is on his second Sonata (finally got him into the manual this time), so when we've gone to the dealership for warranty work in the past, I've occupied my time by poking around.

One time, a sales guy decided that he should capitalize on my presence and get me into a new Genesis sedan. I told him I was just there with my dad, but maybe he was new or desperately in need of money. Guys in their 20s don't generally drop New Genesis money or qualify for a loan.

Regardless, his knowledge of the vehicle he was trying to push didn't really go much past, "It's a sports car. It's basically a 5 series. It's fast, but it costs less. No, it doesn't have a manual, but the manual shift auto feature is just as good if not better. Did I tell you it's basically a sports car? It's really fast."

Triborough > Tom McParland
11/25/2013 at 11:43

So the takeaway from this is that dealers are the problem.

ADabOfOppo; Gone Plaid (Instructables Can Be Confusable) > Dolemite
11/25/2013 at 11:44

Agreed completely.

This is the reason I will pirate media if I have to jump through any hoops to obtain it legally.

I don't generally redistribute, and I know it's "wrong." I would much rather pay for what I pirate, but when they make it nearly impossible to consume the way I want, when I want, and without restriction; meaning I bought and now own that copy, then I will simply avoid headache entirely and steal it.

ZiptieMcBumper > KusabiSensei - Captain of the Toronto Maple Leafs
11/25/2013 at 11:45

Doesn't really apply to luxury vehicles, but:

**COUGH*Mitsubishi*COUGH**

Tom McParland > Triborough
11/25/2013 at 11:47

Yeah that is basically the TL:DR version, but I wanted to make the point that the auto-journo world is focusing on Hyundai/Kia's product offensive to go after the luxury market I think the convo should shift elsewhere.

King Ginger, not writing for Business Insider > Tom McParland
11/25/2013 at 11:49

This is absolutely an issue with dealers for non-luxury brands; the general mentality of the sales staff is one of hard selling in person because they look at volume as being key rather than long-term repeat customers.

I would have liked to see Hyundai/Kia create a new brand for their upmarket cars and then slowly phased their product offerings up to match what the market is looking for, removing Hyundais they want to sell as "Genesis" (my fictional luxury brand example) while moving Kia's up to Hyundai's level. Name changes for these brands are a non-issue because if they DO have name-recognition in the States the connotation is often still negative ("I drove a Rio rental once, hated it").

Then again, they ARE making lots of cash, so what do I know.

Crossed > Arch Duke Maxyenko, Shit Talk Extraordinaire
11/25/2013 at 11:49

I was in the showroom and the interior door handle panel popped out. On a Genesis.

Arch Duke Maxyenko, Shit Talk Extraordinaire > Crossed
11/25/2013 at 11:52

For real?

Volvosaurus-Rex > Tom McParland
11/25/2013 at 11:52

What about experiences with competing mass market brands?

I found that VAG was much more cooperative and offered more of the "luxury buying experience" compared to Ford.

You don't seem to be comparing apples to apples here. I know you are trying to discuss this regarding the new range-topping sedans, but it is an imcomplete picture.

schwartz > StevenG
11/25/2013 at 11:56

Out of the 3 new vehicles I have bought or friends I have helped into new vehicles no one has paid more then invoice price.

Mr. Sinister > Tom McParland
11/25/2013 at 11:56

Between my wife and I, we're on our 4th Hyundai. For sake of this argument, I must admit I've never gone beyond a casual test drive at a more high end dealership.

Our experiences with Hyundai have all been very pleasant. We're repeat customers to the same dealership, so maybe that plays a role. But what I have noticed at this and other non-luxury brand dealerships is the turnover of salespeople. I've seen it with my Subaru dealer, Hyundai dealer, Saturn dealer (back when), Jeep dealer, and all the assorted used car dealers I've bought from. Hell, the first person I talked to about my Genesis Coupe was not there any longer when I went in to buy a week later.

So, I'm wondering if salesperson turnover/retention has anything to do with the level of service you receive at more upscale dealers? Any repeat customers of more upscale brands notice this?

PogosRevenge > Tom McParland
11/25/2013 at 11:57

It sounds like their sales staff has some challenges. Usually it's the result of less-experienced sales staff and a very specific sales technique or directive. If you throw the sales staff something that isn't in their learned " script " then all bets are off. I've seen this many times. The other thing to consider is that they cater to the majority. This means they get every type of customer from cash buyers ( on the rare end ) to people with FICO scores that better resemble a bowling score. ( more predominate ) this means that every customer gets the same treatment regardless. The other issue is that It seems like Hyundai hasn't put a lot of effort in their marketing. I think they do a pretty good job with Kia but somehow Hyundai isn't what it probably should be. They need to have that brand identification that is currently lacking and train staff to deal with customers who don't follow the script.

Tom McParland > Volvosaurus-Rex
11/25/2013 at 11:59

Valid criticism, I find that VW is a cut above but for the most part your mainstream dealers are really hit or miss. Some are cooperative some not, but I have noticed a pattern with local Hyundai/Kia dealers, all of which have lost sales due to an unwillingness to cooperate. This post was really meant as a wakeup call to Hyundai/Kia corporate meaning if they want to go toe-to-toe with zeGermans they have to look beyond product.

Crossed > Arch Duke Maxyenko, Shit Talk Extraordinaire
11/25/2013 at 12:00

I think my explanation's off. The plastic guard behind the interior door handle.

StevenG > Collin
11/25/2013 at 12:00

This is not just Kia, go to any random dealership and ask questions.

I bought a 2012 insight, it is a nice cheap hatchback. Personally a far underrated car for what is it. My wife needed a newer car, we went to the same dealer. She went to look at used Civics and the salesman did nothing but talk bad about my car. The car that was his brand, from his dealership and still had the dealer plate surround on it. Not only did he claim the civic could get comparable mileage, no civic gets ~50mpg in mixed driving, he told me my back seats did not fold down. Which was really neat because at the time the seats were folded flat. He could have looked at my car and seen this fact from where he was standing. Then we asked simple questions about the options on the car he wanted to show us, he could answer none of them. It was like he had never seen this car or any civic before. We complained it smelled like dog, he said that was impossible it was steam cleaned. Then he offered us the car for $3000 over bluebook.

TxFlOr > Tom McParland
11/25/2013 at 12:02

I agree completely. I was able to cut through this when buying a Hyundai because my friend is a sales manager, but I see how they are stuck in a 90's model. The local Kia dealers here still advertise as if they are selling 2 for 1 Sephias. They need to realize that the customers are there now because they actually like the product, not because it's all they think they can afford. The dealers really are the last hurdle to Hyundai's arrival as a top tier automaker.

Arch Duke Maxyenko, Shit Talk Extraordinaire > Crossed
11/25/2013 at 12:03

Seems plausible, my friend's 04 elantra's gear selector broke off in my hand. I replaced it with a blue anodized aluminum handle.

StevenG > schwartz
11/25/2013 at 12:04

Sure, because even those are joke these days. Did you factor in holdback? Many brands now play all kinds of games with fake invoice prices. The customer got wise to the MSRP game so now they are playing the same game with invoices.

Tom McParland > StevenG
11/25/2013 at 12:04

Now that is just crazy talk. :D

dogisbadob > Tom McParland
11/25/2013 at 12:05

Actually, Lexus *did* make it into that league overnight :p

It only took them like a month from the initial release of the LS400 to dominate the market held by the 7-series and S-class. Two years later they'd become the #1 luxury car brand (when the ES300 came out).

Anyway, good writeup though. I never knew about the consultant thing though.

Tom McParland > Mr. Sinister
11/25/2013 at 12:07

Turnover is a HUGE factor...if you have a rookie salesperson and is on a short leash from the manager they tend to get very nervous when talking to me. When I talk to the manager they tend to be very off-putting. Now again, this could just be an issue in the Philly/NYC metro area.

Tom McParland > TxFlOr
11/25/2013 at 12:07

THIS!

Ltd783 > Tom McParland
11/25/2013 at 12:08

How are other mainstream brands with your email requests? I think it sounds like the salesman are just completely unfamiliar with your methods, and give up after a few unproductive emails.

I advertise my business online, and I can't even begin to tell you how many time wasters and spam bots contact me through email. First contact should always be over the phone.

Tom McParland > PogosRevenge
11/25/2013 at 12:09

You are absolutely correct when it comes to the "credit challenged" customers. Places like these are so used to steam-rolling desperate and uninformed car buyers when dealing with a more savvy shopper it is usually flight or fight.

StevenG > Zoom
11/25/2013 at 12:09

As a low end buyer not impacted by that this put me off that brand all together.

No matter what, these sales tactics suck. No one wants to have something sold to them that way.

CAPTAINpotato > Tom McParland
11/25/2013 at 12:14

I am wondering if this is with multiple Hyndai/Kia dealerships or just one. I have worked at several dealerships and the people, management, sales approach all seem to be different. Painting all Hyundai/Kia dealerships with a broad stroke may be a misconception. On the other hand most dealerships want the customers in the dealership so they feel trapped and can work the customer over for a commitment to buy. Either way sales strategies don't seem to be manufacturer mandated techniques but more so the owner's/management's preference.

GrauGeist > Tom McParland
11/25/2013 at 12:16

Do Hyundai & Kia even do fleet sales? Seems to me, if there was a fleet sales manager, he'd be the guy to talk to.

The World of Vee > Tom McParland
11/25/2013 at 12:17

I just (as in yesterday) got my uncle into a 2014 Equus ultimate. He was coming from an E550 and when looking at all the trim inside he was convinced that he needed to at least test drive it. Feeling your skepticism of a company that sells a 10k car as well as a 70k car in terms of service, we opted to have the sales rep meet us at a local park by his house, he explained all the features and we took it for a test drive. The "we'll come to you" business model is a good one, but don't call them to your house or you'll lose some bargaining stance (can't really leave and go home can you?). In the end he opted to lease it 3 years 15k miles, and got a very good price for a car that costs almost 70k (700/month) and the dealer gave him the Equus logo rear badge too (why this isn't standard baffles me).

I think what really grabbed him was that they'll pick up his car and leave a loner equus whenever it needs service, so in essence the dealer experience was negated by the comforts of his own home. The "client application" even had such questions as what's your favorite coffee/beverage etc implying that they'll bring him a hot coffee in the cupholder of the loaner.

The 2014 is a significant redesign, it's beautiful inside and out...the rear seats are exquisite, you lose the refrigerator but you gain two huge LCD panels and even more comfy leather seating surfaces...really premium stuff. He got Brown with Ivory and I don't think he could be happier.

I do think that the premium brand is coming, and it'll be a significant move for both Hyundai and Kia, there's simply no way they can continue to offer vehicles of this ilk without a brand to back it. I'm not a badge snob and hence I told him to take a chance, but the average US luxury car buyer put a lot of stock in the badge...and I can see why and I think auto brands can too.

Tom McParland > Ltd783
11/25/2013 at 12:18

Excellent question, most mainstream brands are pretty good with responding to emails. Even if it is just a "general" follow up. Again, it really depends on the local management philosophy as I mentioned in the other piece. I do make phone calls and often follow up that way.

thxoneonethreeeight > Tom McParland
11/25/2013 at 12:21

I'm glad someone with a lot of car-buying experience writes these articles because then it doesn't sound like a biased, disgruntled customer with an isolated incident. I totally agree with you on this problem.

We bought a Hyundai for my parents last year and the experience was fucking terrible. We knew exactly what we wanted but the salesperson and then the manager was stonewalling us on price. They wouldn't give us a freaking quote. They just kept asking how much we wanted to pay a month. We ended up buying a better equipped Santa Fe at another dealer that was a lot better at handling people in general and it was cheaper.

Some of these dealerships use cheap-car selling tactics on cars that people actually want to buy now. I see this as a problem with their crappy sales tactics and consequently the overall Hyundai image.

Tom McParland > CAPTAINpotato
11/25/2013 at 12:24

That is a good counter-point. I wrote this after my 5th encounter with a Hyundai/Kia dealership in the NJ area at the same time I was brokering a deal on a Audi Q7 the conversations on the same day with the different dealerships really stood out.

Ltd783 > Tom McParland
11/25/2013 at 12:24

Interesting. It really depends dealer to dealer it seems to me, I just got through leasing a new car through my business, and getting exact quotes from some dealerships is like pulling teeth.

I'm an attorney, at the Honda dealer in person, wearing a suit even, and they still wouldn't give me an exact lease rate on an Accord. Even after submitting to a credit check, the didn't give me a quote because I wouldn't say I was "ready to buy today". I told them I wanted to test drive some other cars still, and after I liked the Altima better, and they didn't treat me like an adversary, I went with Nissan.

Pcleez > Tom McParland
11/25/2013 at 12:25

So I am not a professional car-buying consultant, because I am dumb and just do this for free for friends. I've ran into this problem a lot of with car dealers. Unfortunately, they are not always the most client focused people (except the good ones, who are in fact VERY customer driven). I'd recommend going down the "look buddy, do you want a commission or not?" route. I hate having to do it, but it's necessary with people who just don't understand that for much of the population, sitting in the dealership and bullshiting with a car dealer is like going to the dentist, if your dentist was satan.

TheCraigy > Tom McParland
11/25/2013 at 12:25

As you go down the manufacturer totem the dealerships get more dumpy, the salesmen get worse, and the experience just gets crappier and crappier. That's not to say a high-end dealer won't be occasionally snobby, but typically as you move up they get much better and the salesmen are much more helpful, extremely accommodating, and less pushy.

When I was looking for a BMW recently, and all of the salesmen were fantastic. Looked at Acura, Lexus for my wife and again the salesmen were very good and the dealer experience was great. Went with my brother-in-law who wanted to buy a new Mazda, and it was your typical run down dump of a dealership with the expected cheesy full-of-hot-air salesmen running the place.

The low end cars have incredibly thin margin, and thus very small commissions, giving us lower-quality salesmen who cater to lower-budget buyers who are often less sophisticated/more willing to deal with the bullshit. There's no way a real buyer would ever cross-shop new lexus, mercedes with hyundai, kia.

Pcleez > Tom McParland
11/25/2013 at 12:26

Tom McParland > Ltd783
11/25/2013 at 12:26

Yeah it is totally dealer-to-dealer. But Honda isn't gunning for the Germans, Hyundai is and corporate needs to realize that product alone isn't going to help in that offensive.

TheCraigy > Tom McParland
11/25/2013 at 12:31

Yep! Why do these salesmen keep giving us the same canned garbage? Because there are thousands of poor saps who come in to the dealer and BELIEVE IT and end up buying the car (or trying to, and getting turned down because of credit).

klurejr > Tom McParland
11/25/2013 at 12:31

Even if Kia and Hyundai don't want to have a separate brand for the Luxury market cars, they need to have separate sales and management staff that only sell those cars. You cannot have the same guy who sells base econobox units also selling high end lux Cars.

I used to work in the Copier sales business and they had separate teams for major accounts vs down the street regular business accounts. You have to specialize in what you are selling if you want to sell to the big boys.

TheCraigy > davedave1111
11/25/2013 at 12:32

What are they going to do? Fire the existing salesmen and re-hire some more crappy salesmen? Endless cycle.

schwartz > StevenG
11/25/2013 at 12:34

Holdbacks are a lot harder to calculate but I typically shoot for 500 under invoice as my goal price.

kotaKat > Tom McParland
11/25/2013 at 12:35

Good warranty? Bullshit. Apparently (and I didn't realize until well after the fact) my "10/100k" warranty is really a 6/60k because I'm not the original owner. The ignition coils died about 2000 miles before the end of the warranty, and it was a harrowing hour long drive to the dealership on the interstate (what with running on basically 2 cylinders). No tow (because I'm not the original owner), no loaner (because the job takes 30 minutes), and it took them a week to bring it into the shop so I didn't have a car basically for over a week.

TheCraigy > dogisbadob
11/25/2013 at 12:35

Lexus LS was developed over five years at over a billion dollars in R&D.

But yeah, when they launched, that was it :)

CleverBS > Tom McParland
11/25/2013 at 12:35

I've cross shopped luxury brands with not-so-luxury brands on three separate occasions now, and have ended up with, in order:

- a new 2007 BMW 328xi (lease)

- CPO 2008 Infiniti G35x (purchase)

- a new 2013 VW Golf R (purchase)

Back in 2007, I tried to collect information through the internet and phone calls, but not a lot of dealerships were willing to cooperate. The luxury manufacturers were more willing to cooperate (Lexus, Infiniti, BMW, Audi, etc.), especially after I had already been in for a test drive, and this was when a lot of information was starting to become available online for people to easily find (incentives especially). The non-luxury car dealers wanted to pretend the internet did not exist, for the most part.

In late 2010, when I bought the Infiniti, the luxury car dealers were fully cooperative over the internet and phone, before I even set foot on the lot. Inventories were easy to browse online for the most part, with BMW being the easiest, especially when it came to finding cars with specific options. Non-luxury brands would still give me the same deal: "Come on in and we can discuss it and go for a test drive." Ugh. And once I got there, they were only interested in wasting my time.

This past June, when I bought the Golf R, 95% of my shopping and exchanges were done through the internet and email. Most (not all) VW dealers are in on the luxury car sales model. I considered a Focus ST for a while, and I can tell you that Ford dealers still stick to the old model and lag far behind... hell, even though they list inventory on their websites, a lot of the cars they list on there aren't even on their lot - many are "in transit" with no way to tell when or if they will reach the lot. Buying the Golf R was simple - came in with a Truecar guaranteed price from another dealer, NADA clean trade in for my G35x, and after they evaluated my car and found nothing wrong with it, agreed to both values with no argument.

Around the same time went car shopping with a friend at non-luxury dealers, and it was the most frustrating experience of my life. Offering leases on cars at monthly payments similar to what it would cost to buy the car outright (when they were offering 0% financing!), ridiculous low ball offers on trade ins and overcharging on cars, and basically just pretending the internet doesn't exist. Every internet request was basically met with a "just come in for a test drive!" Not helpful.

I think truecar has been the best help for people who know nothing about car buying with the guaranteed price and listing the incentives, at least it gives them an idea of what pricing to expect below MSRP. But the non-luxury dealers need to really step it up and quit pretending the internet doesn't exist if they want people to treat their vehicles as the near-premium products they're starting to become... or people will keep spending the extra $5-10k for the cheapest BMW, Benz, Lexus, etc. instead of the high end Ford/Honda/Kia/Hyundai just because of the dealership experience.

Gum > Tom McParland
11/25/2013 at 12:36

I currently work at a Hyundai dealer in Florida in the Internet Sales team. For the most part, many cases like the author stated is true, but in my dealership we always send an initial quote, then we call and confirm the vehicle the customer is looking for. Hyundai also had a special seminar for Premium customers on how to treat them, but only a select few were chosen to learn, not the entire sales team.

none8239487234 > Tom McParland
11/25/2013 at 12:36

If you have the money to hire a consultant to shop for your vehicle why on earth would you want one of these cars? The unfortunate truth is most of the Asian made SUV's and Luxury cars are just inexpensive versions of higher end brands. The notable exception of course is their small hatchbacks and sedans which are their own unique designs. Despite having some of the same features these vehicles will always be the "cheap" option until the Asian brands do something ground breaking rather than just offering "the same stuff" that the high end brands do.

I dealt with this shopping with American brands. I wanted an American car with a certain trim level and certain options. When I dealt with the American dealers I got "here's what we have on our lot" rather than the willingness to special order a car. Needless to say they did not make a sale despite their attempts to "trick" me into negotiating on a car I would not want at all regardless of the discounts they offered.

The car industry in general is pretty obsolete. I would love to see dealers completely eliminated from the car buying experience and a substantial savings passed onto the consumer. When you are ordering a 100K car what do you need the dealer for anyway?

Turbo-Brick > StevenG
11/25/2013 at 12:37

You actually can build your own car. It's called a factory order. You just have to be willing to wait for it to be delivered, and depending on where it's assembled, that can take a while. My STI took 3 months, but it had exactly the options I wanted in the color and body style I wanted. I didn't have to compromise at all.

My strategy was to decide what options I wanted, and then calculate a fair price (basically invoice). Then called up 4 dealerships asking if they'd be willing to sell me a car with the specified options for that price. The one that eventually agreed ended up being 30 min away, but I only had to travel there twice. Once to sign the paperwork, and once to pick up the car.

No fuss, no mess, and no stress (other than waiting for the damn car to arrive).

StevenG > schwartz
11/25/2013 at 12:45

Which just means they will start making the holdback higher, or some other trick.

While this is a game you can keep playing so will they. It costs money for both parties to play so assuming their only method of making profit is not information asymmetry it would be better for everyone to stop doing it.

StevenG > schwartz
11/25/2013 at 12:45

Which just means they will start making the holdback higher, or some other trick.

StevenG > schwartz
11/25/2013 at 12:45

Which just means they will start making the holdback higher, or some other trick.

StevenG > Turbo-Brick
11/25/2013 at 12:47

Go try that with a KIA dealer and let me know how it works out.

I offered to wait 6 months and they still had no interest.

Destructive Tester > Tom McParland
11/25/2013 at 12:50

I find it both funny and a bit disturbing that a brand who was savvy enough to reinvent their cars fails to see that you, as a purchasing agent, are the definition of a "preferred customer." Why can't they understand that a good experience with you can pay dividends many times over what it can with a normal buyer?

Lucid0ne > Tom McParland
11/25/2013 at 12:51

Wow! How do I become a professional car buying consultant!?

JEM > Tom McParland
11/25/2013 at 12:51

Yeah after reading this, my first thought was to call their corporate NA dealer headquarters. I agree with S2MG, I doubt the dealers will care, and who knows about the regional managers.

Honesty > Tom McParland
11/25/2013 at 12:52

This is a great read and doesn't surprise me in the least.

*warning* I do not want to get into a debate about hybrid cars *warning*

My girlfriend and I went car shopping in the spring of 2012, and had similarly disappointing experiences at certain Hyundai dealerships. Honda let her hop right into a CR-Z and give it a drive, but the salesperson at one Hyundai dealership went on and on for about 5 minutes about how he knows what she wants, and she doesn't want a hybrid Sonata, and the Hybrid Sonata is a bad deal because it'll take her X years to make up the cost (she planned on keeping the vehicle until it won't run anymore, so that's not an issue...).

Basically she wanted a hybrid car, but one Hyundai dealership's salesperson tried everything he could to convince her otherwise. Maybe there's less room for him to get his paycheck out of a hybrid car sale, but if the customer comes to your dealership looking to buy a hybrid, you don't tell them they're making a mistake.

Hyundai's products have really improved lately, but I don't think anyone is managing their sales techniques as well.

davedave1111 > TheCraigy
11/25/2013 at 12:56

What did Mercedes and BMW do? It's not about firing salesmen, but about making sure they know what their job is and do it right.

Mr. Sinister > Tom McParland
11/25/2013 at 13:04

Well, I'm in the Philly/Baltimore Metro area, so it extends south somewhat.....

Mr. Sinister > Tom McParland
11/25/2013 at 13:05

Well, I'm in the Philly/Baltimore Metro area, so it extends south somewhat.....

cesariojpn > Tom McParland
11/25/2013 at 13:07

Solution #1 to Hyundai/Kia's Luxury Problem: Kill the people who thought of this idea, and destroy every scrap of footage out there with unnecessary force.

Kinja'd!!!

efme > Turbo-Brick
11/25/2013 at 13:10

I actually always thought that I had to buy on the lot to get a good deal. little do I know that they will bargain for an ordered car. How would rebates come into account for a ordered car?

lets say you order in november and by feb there is a 3000 rebate on the car. are you stuck at the price you prenegogiated or get to take advantage of that rebate later?

efme > Tom McParland
11/25/2013 at 13:11

how does all of this compare to TrueCar?

Turbo-Brick > StevenG
11/25/2013 at 13:11

No interest in placing a factory order? Or no interest in matching your asking price?

I never had any pushback from Subaru in trying to place a factory order. The only point of 'contention' was price, and I ended up not having to move at all after shopping around.

NipperDawg > ncasolowork2
11/25/2013 at 13:11

It shocks me when I walk into a dealership, ask specific questions about a car (well let me look that up is an acceptable answer I rarely hear) and be expected to drop 10-15-20-30K on the spot with a 5 minute test drive. Sadly they sell these things like they are selling an ipad.