Total rescue of sales"
Author|Wang Lei, Liu Yajie
Edited by Qin Zhangyong
Korean luxury cars have begun to save themselves, and the most direct way is to change the commander.
On July 31, Genesis announced the appointment of Zhu Jiang as the new CEO of China, which will take effect on August 5, 2024.
When it comes to this brand, many people may feel unfamiliar, after all, its presence in the luxury car market is too low. In June, Genesis sold only 87 units a month.
And it is worth noting that Wells Lee, the current CEO of Genesis, also took office in October last year.
In less than a year, the coach has changed twice, and "Korea Bentley" has put the task of boosting sales in the Chinese market on the new CEO.
01
Marketing veterans take over the baton
Zhu Jiang has been working in the automotive industry for more than 20 years, and can be said to be a veteran of the automotive industry, from new forces to international luxury car brands, and even overseas luxury brands, he has held important positions.
In 2003, he joined BMW Brilliance and was responsible for marketing activities. From 2008 to 2012, he served as the Director of Brand Management of BMW MINI, becoming the first Chinese Brand Director of the BMW Group worldwide, and was later promoted to Vice President of Brand Management of MINI China.
From 2013 to 2016, he joined Lexus as Deputy General Manager of Lexus China, and in 2017, he joined NIO as Vice President of User Development.
After leaving NIO, he worked for Ford Motor Co., Ltd., where he was appointed Chief Operating Officer of Ford Motor (China) Electric Vehicle Division.
At the end of November 2021, he joined Jidu Automobile as Vice President, responsible for the user development and operation of Jidu Automobile. After joining for less than half a year, I chose to leave my job.
In September 2022, he served as the first managing director of Lucid, a new United States car manufacturer, in China, leading the brand to enter the Chinese market and expand its business.
It is not difficult to see that most of Zhu Jiang's career is related to the development of the Chinese market.
In the eyes of the industry, Zhu Jiang is a person who is very good at marketing brands. His achievements include, but are not limited to, building the BMW MINI from a niche brand with annual sales of less than 3,000 units to a representative of high-end personalized cars, helping Lexus achieve its sales target of 100,000 units in the Chinese market for the first time in 2016, and building a high-viscosity user base for NIO.
In the face of such a perfect resume, Mike Song, the global head of Genesis, said that Zhu Jiang has accumulated rich experience in operations and management, and is very entrepreneurial. "I am confident that Zhu Jiang will lead Genesis in the long term and grow its business in China."
And Zhu Jiang's predecessor, Li Zhe, had a mixed reputation.
On October 25, 2023, Richard Ho stepped down as CEO of Genesis China and was replaced by Li Zhe, the former Chief Coordination Officer.
Before taking office, Li Zhe presided over the all-staff meeting in China. He said at the meeting that in the three years since entering China, Genesis has lost as much as 3 billion yuan. Among them, in less than 10 months in 2023, there will be a loss of 1.2 billion. Converted to an average marketing cost of 710,000 yuan per vehicle, high marketing expenses are regarded as one of the "important reasons" for huge losses.
At that time, Li Zhe also blamed the employees for the poor sales and angrily scolded the employees for having no feelings for the company. Because in the past three years, not a single Genesis China employee has purchased a self-branded vehicle, and threatened employees with "if everyone leaves the company now to pursue external development, they will be welcome."
Although CEOs have changed so frequently since 2023, Genesis' sales in China are still not ideal. In 2023, only 1,558 units were sold. Mercedes-Benz and BMW, which are also positioned as luxury cars, will sell 187,300 and 174,300 imported cars in China in 2023, respectively. In June of the same year, Genesis also recalled 1,602 vehicles due to quality problems, covering basically the entire product line.
In the first half of this year, Genesis sales fell 40% year-on-year in March and 42% month-on-month in May, with only 87 units sold across six models. Acura, a luxury brand that previously withdrew from the Chinese market, sold 2,088 units in its last sales year in China (2022), with an average monthly sales of 174 units, which is much better than Genesis' current situation.
02
It's too hard to make it a "Korea Bentley".
Maybe everyone is not very familiar with the name Genesis, just like a small Internet celebrity in the seventh or eighth line, you may have seen it, but you just can't name it.
Founded in 2015 as a luxury brand under Korea's Hyundai Motor Group, GENESIS is similar to Toyota Group's Lexus.
As early as 2003, Hyundai launched the GENESIS project, changed its name twice, and tried to enter the Chinese market three times.
At the end of 2007, the production version of Hyundai GENESIS was officially launched, and the following year it was officially introduced to the Chinese market. However, at that time, it had not yet become an independent sub-brand, and was only sold as a high-end imported model of Hyundai, and its Chinese name after being introduced into China was "Lawns". However, after entering the Chinese market, the sales performance was not good, and finally it was hastily closed and disappeared.
In 2014, Hyundai made another decision - rebranded GENESIS as "Genesis" to enter the Chinese market for the second time, but this time the performance was also "inactive", and domestic consumers have never been able to recognize it, so it withdrew from the Chinese market again in 2017.
In April 2021, Genesis announced its third entry into the Chinese market as an imported car on the Bund in Shanghai, which was nicknamed "Korea Bentley" at that time.
Genesis' idea to enter the domestic car market is very simple, that is, it intends to replicate the success of Toyota Lexus, benchmark BBA, and shape its image as a luxury car.
In 2020, the year before Genesis entered China, the sales volume of China's luxury car market with more than 300,000 units was about 3.61 million units, a year-on-year increase of 11.6%, far better than the overall car market sales decline of 6.3%.
As of the first half of 2024, while passenger car sales only increased by 3.6% year-on-year, luxury cars in the first half of the year alone have reached 2.512 million units, an increase of 11.3% over the same period last year, and the proportion of the overall market has also increased to 25.1%.
Seeing that luxury cars are selling better and better in China, Genesis is not interested in red, it is a fake.
In just two years, Genesis has introduced all eight of its models to China, including five fuel vehicles and three electric vehicles, and adopted a direct sales model.
Up to now, Genesis has successively deployed a variety of models in China, including G90, G80 (ICE/EV), G70, GV80, GV80 Coupe, GV70 (ICE/EV), GV60 (EV) and other models.
But it backfired, and it was still thunder and rain. According to the statistics of the China Passenger Car Market Information Association (CPCA), Genesis will sell only 1,558 vehicles in the Chinese market in 2023, and only 1,457 units in 2022 before that, which is no less than the total sales of 26.864 million units in China's automotive industry last year.
As of the first half of this year, Genesis had sold only 835 units, and the 140 units sold in a single month were even less than the sales of a single model for some brands. According to this situation, its total annual sales are not even comparable to the monthly sales of a single model of luxury brands, and its market share is almost negligible, and its situation can be said to be quite embarrassing.
The reason is that Genesis's presence in the market is too low, and it has no advantages in terms of brand appeal or cost performance.
Especially in the context of the decline of Korean brands in China, it is even more difficult for consumers to accept a Korean luxury brand.
It is important to know that the mainstream first- and second-tier luxury brands in the Chinese market have a century-long history of car manufacturing, and Genesis has only been established for 9 years, and Genesis has been in China for less than 3 years.
In terms of cost performance, compared with the second-tier luxury brands Volvo, Lincoln, and Cadillac, which have been made in China, the identity of imported cars is not cheap.
In addition, in terms of channels, according to the information on Genesis' official website in China, the brand currently has only 19 sales centers in China, including Genesis Homes, Genesis Centers and showrooms, covering only 16 cities, and most of them are located outside the first-tier cities.
Moreover, judging from the distribution of Genesis' new car sales, due to the layout of its channels, except for a small number of sales in the Shanghai market, where its headquarters in China is located, most of its customers are concentrated in second-tier cities and below. This also means that in first-tier cities with high coverage of luxury models, Genesis is even rarer.
In addition, the large-scale recall of its models and the controversial "oil-to-electric" issue have made Genesis, a "new luxury brand", even worse.
Now, Zhu Jiang, who is good at telling Chinese stories, has officially taken over Genesis' China business, and Genesis not only needs to deal with traditional luxury brands, but also has to face the impact of new forces, which is hellish in difficulty.