Hyundai to Open “Brand Store” in China in Bid to Elevate Image

Hyundai Motor Co. hopes to reverse sagging sales and anti-Korean sentiment in China with its first “brand experience” facility in the country, sources tell Reuters.

Hyundai’s will open the center in September Beijing’s trendy 798 Art District. The carmaker says the facility, which won’t show actual cars, is intended to elevate the company’s image. Reuters notes the strategy is akin to BMW and Mercedes-Benz brand centers in China.

The news service’s sources say Hyundai also is pondering local production from kits of its slow-selling Genesis luxury brand. The move would sharply reduce import tariffs on the vehicles to 10%. The company aims to populate the Genesis brand in China with six models, including two SUVs, by 2020. But Reuters’ sources say the company hasn’t decided which models to assemble in China

Hyundai and its Kia affiliate were together ranked third among foreign brands in China until a few years ago. But their best-selling models, mainly small and midsize sedans, also left the brands with a downscale image among Chinese consumers compared with their Japanese rivals.

Last year Hyundai-Kia’s combined market share shrank to an 8-year-low of 8.1% and has sagged to 5% this year. Reuters says Hyundai sold only 74 imported Genesis vehicles in China last year compared with 1,000 in 2015. Sales this year also have been hurt by the Chinese central government’s disapproval of Korea’s deployment of a U.S.-supplied anti-missile system.