Hyundai began selling cars in the U.S. in 1986 when it introduced the subcompact Excel here. The less than $5,000 price tag was a hit and prompted Forbes magazine to name it one of the top 10 products of the year.

Then things fell apart when reports about poor quality and reliability began to circulate. Predictably, sales tanked and it wasn’t until many years later, in 1998, that the results of new quality-oriented management began to draw attention.

To erase lingering doubts about quality, Hyundai introduced a 10-year powertrain warranty. With a new focus on quality and reliability, sales improved and have done so every year since 1998 with a 20 percent compound growth rate.

Even Toyota vice chairman Fujio acknowledged the company is growing in Toyota’s rearview mirror. “Hyundai has quality and prices that have caught customers’ attention, not to mention ours,” he said in August 2005.

Hyundai positions the all-new Genesis to compete with luxury brands such as BMW and Infiniti.

In 2008, Hyundai Santa Fe and Hyundai Elantra were awarded the 2008 Consumer Reports “top pick” and Elantra earned Consumer Reports’ “excellent” rating in predicted reliability. Elantra is Consumer Reports top-ranked 2008 vehicle, beating out such high-quality stalwarts as the Honda Civic, Toyota Corolla and Toyota Prius.

Considering that in 1998, Hyundai ranked among the worst for initial defects, the turnaround has been extraordinary. Confidence about their capability has prompted Hyundai to challenge the “big dogs” of the luxury segments.

During the design and development of the Genesis, Hyundai benchmarked the luxury brands with the specific goal of being equal or better. This process isn’t particularly new since most automakers constantly benchmark their competition. What is new is that a Korean producer of small, low priced cars has the confidence and capability to build a competitive upscale car.

The 2009 Genesis is an all-new, rear-wheel drive sedan with two trim levels identified by the powertrain configuration – 3.8-liter V-6 or 4.6-liter V-8. The styling is neither controversial nor trendy, but has an athletic, well-proportioned look of elegance. The lack of the “H” badge on the grille is intentional. Seeing a Genesis in your rearview mirror for the first time is sure to entice upscale shoppers to take a second look.

The Hyundai marketing folks like to compare the Genesis 3.8 to the Lexus ES, Chrysler 300, Pontiac G8 and Cadillac CTS. Likewise, Genesis 4.6 is compared with the Lexus GS, Infiniti M, BMW 5 Series, and Mercedes E-Class.

The 3.8-liter V-6 is rated at a respectable 290 horsepower and 264 lb.-ft. of torque. That’s better than any of its competitors. Fuel efficiency of 18/27 city/highway beats all but the Pontiac G8.

The 4.6-liter engine is Hyundai’s first production V-8. It’s a state-of-the-art powerplant that produces 375 horsepower and 333 lb.-ft. of torque using premium gasoline and drops to 368 hp. and 324 lb.-ft. with regular grade.

This new V-8 is impressively powerful, smooth and refined, just like the Lexus V-8. Fuel efficiency of 17/25 beats all V-8 competitors.

The V-6 and V-8 are coupled to six-speed automatics with manual shift mode are supplied by ZF and Asian, respectively. They were selected for their smooth upshifts and well-controlled downshifts.

The 52/48 front/rear weight distribution is nearly ideal for rear-wheel drive handling. The five-link front and rear independent suspension hardware is mostly lightweight aluminum to minimize weight. Only the Lexus GS offers the superior five-link suspension front and rear.

Knowing that most of their buyers are more interested in comfort than all-out performance, the suspension and steering are calibrated for comfort and ease of handling.

The anti-lock brake system is integrated with the electronic stability control, traction control, electronic brake-force distribution and brake assist systems.

Inside, the fit and finish materials of the cabin are first class and easily match any of Genesis’s competitors. The feel of real wood, smell of real leather and look of hand stitching contribute to a sense of luxury and quality.

With a base price of $33,000, the Genesis 3.8 with the premium package is $8,000 less than a comparably equipped Infiniti M and $22,000 less than a BMW 535i. With a starting price of $38,000 a Genesis 4.6 is $17,000 less than a comparably equipped Lexus GS 460 and $26,000 less than a Mercedes E 550.

Given just a little time, Hyundai could very well dominate the luxury scene, and if you think that’s impossible, consider this: It took the Japanese 25 years to dominate the luxury car segment with Lexus. The Koreans are planning to do it in half the time starting with Genesis.

Dave Van Sickle MOTOR MATTERS

In the automobile business, success comes in a variety of ways: deliver a new and exciting product, offer value for the money, or catch the public fancy with a different concept.

You also can benefit from surprise. If you manage to combine low expectations with the other elements, you almost certainly will wind up with a winner.

That is where Hyundai, the South Korean vehicle manufacturer, finds itself with the introduction of the all-new 2009 Genesis sedan, its first foray into the upscale full-size, V8 powered, rear-drive realm currently ruled by a select few manufacturers.

Hyundai has come a long way in a little more than two decades in the United States. It started in the mid-1980s with the Excel:, a subcompact hatchback with a low price and good fuel economy.

Unfortunately, the little car suffered from chronic bouts of self-destruction and Hyundai did not establish itself as a desirable brand. The record over the years has been spotty until recently, when the company expanded its lineup and markedly improved its quality.

Hyundai’s luxurious Genesis offers upscale performance and convenience at a bargain price.

Although it still offers economy cars, it also challenged the best of the family sedans — the Honda Accord and Toyota Camry — and succeeded with the latest iteration of the Sonata, which now is fully competitive with the two Japanese icons, as well as with the new Chevrolet Malibu, Nissan Altima and Ford Fusion.

Hyundai even crafted a near-luxury sedan, the Azera, which was designed to compete against the likes of the Toyota Avalon, Nissan Maxima and Buick Lacrosse.

But from an advertising standpoint, the company draped a tarp over the Azera, so sales have been mediocre.

That’s not likely with the new flagship Genesis. This large luxury sedan is so unexpectedly refined that it should create a buzz regardless of whether Hyundai does much to publicize it.

The main question is whether its size and powerful V8 will turn off customers sensitive to high gas prices.

Nevertheless, the company knows it has a good thing and is looking to sell 50,000 copies a year.

Executives also figure that once they get the word out, the Genesis could kick-start sales of the Azera as customers wander through showrooms.

Based on interior volume, the Azera and the Genesis qualify as large cars under the government’s definition.

But the front-drive Azera, which offers only V6 power, likely will be perceived as a mid-size near-luxury car, while the Genesis, with V6 or V8 engines, will not be viewed as anything but a full-size luxury cruiser.

How otherwise to classify the Genesis?

It performs as well, and is as luxurious and loaded with safety and high-tech features as quite a few imported luxury cars that cost many thousands of dollars more.

There’s an audiophile’s Lexicon audio system, big-screen navigation with a backup camera, Bluetooth connectivity, XM satellite radio and heated and cooled front seats, among others.

The styling is classy conservative, with a stylized grille that would not look out of place on a Mercedes-Benz, and in fact likely will be mistakenly identified as one. In the simple and elegant interior, there’s an abundance of carefully-crafted, high-quality materials, including leather-covered door panels, seats and dash.

Because it has rear drive, the Genesis suffers somewhat in interior accommodations. The front seats are comfortable and supportive, and the outboard rear seats will elicit few complaints.

But the center-rear position offers only a hard cushion and a big floor hump.

The Hyundai hawkers unabashedly compare the Genesis, on features and performance, with an array of models from BMW, Mercedes-Benz, Audi, Infiniti and Lexus, while undercutting them on price. Among U.S. models, it compares favorably with the Cadillac STS, Buick Lucerne, Chrysler 300 and the new Lincoln MKS, although the Lincoln comes with front-drive or all-wheel drive and does not offer a V8.

The Genesis certainly has the bones, but it does not have the cachet of some of its big-bucks competitors. So another question is whether buyers will associate the Hyundai name with high-performance luxury.

There are two Genesis models: the 3.8 with a 290-horsepower V6 engine, which has a base price of $33,000, and the 4.6, with a V8 and an opening price of $38,000.

There are two V8 horsepower ratings.

You get 268 running with regular gasoline and 275 with premium fuel. The transmission is a six-speed automatic with a manual-shift mode.

Standard equipment is extensive and options are limited to a few packages.

The tested Genesis 4.6 had the $4,000 technology package, which brought its as-delivered price up to $42,000. The fully-optioned 3.8 model has a $40,000 sticker.

Hyundai expects about eight of ten buyers will order the 3.8, which has an EPA city/highway fuel economy rating of 18/27 miles per gallon compared to the 4.6, rated at 17/26.

The surprising thing about either Genesis is how well they handle and perform.

It’s no great trick in modern automobile design to produce a cushy straight-line freeway luxury barge.

But Hyundai has put together a package that is so well balanced it can be flogged merrily around a race track.

Frank Aukofer SPECIAL TO THE WASHINGTON TIMES

It was a bold claim Hyundai honchos made in April – Genesis, Hyundai’s all-new luxury sedan, they said, would deliver a smackdown to those tried-and-true jewels Mercedes, BMW and other swank rides people of means usually reward themselves with, and would run over Chrysler’s 300 and Pontiac G8 in the process.

Hyundai’s got reason enough to boast. After Toyota and Honda, their vehicles offer the best average mileage in America, and the company continues to keep offer cheap, quality vehicles. If the new ride was anything like the Elantra, Santa Fe or Sonata, it promised to be something special. Five months later came the unveiling of Hyundai’s new baby at a gathering in Tarrytown, where a dozen or so Geneses were lined up for inspection, tire-kicking and test driving.

A fine sight they were, too, gleaming, handsome, solid and sturdy-looking on the outside and plush and luxurious on the inside, like luxe sedans ought to be. I opened the door, got into the driver’s seat and inhaled the new-car bouquet, beheld the leather-wrapped dash and door panels and felt reasonably — not overwhelmingly — swaddled in comfort.

I took two half-hour rides, one driving and one as a passenger in the back seat. The quick verdict? Benz, Lexus, Cadillac and Chrysler needn’t tremble. Hyundai has its staunch fans, and this car is for them. It is not so much a complete redesign of the brand as it is an extensive upping of quality on every aspect from body to engine to suspension and quality of materials.

The car comes in two trims. One is a 3.8-liter, 240-hp V-6 model starting at $33,000. There also is a more powerful, and expensive, 4.6-liter, 375-hp V-8 at $38,000 (both prices include delivery charges). The 3.8-liter model offers three option packages costing $2,000, $3,000 and $4,000, with the base package offering items like a leather-wrapped dash, power sunroof, a 14-speaker sound system and more. For another grand, you’ll get 18-inch silver alloy wheels added to the package. For $4,000, a backup warning system, nav system, multimedia controller and satellite radio with a year’s subscription, along with other accoutrements, are provided.

The 4.6-liter model has just one $4,000 package offered, which includes all you get in the 3.6-liter’s most expensive package.

It’s got a few challenges ahead, the big one being the car’s entry into the marketplace at a time of crises for the economy and high gas prices. Mileage, as can be expected in a sedan, isn’t great at 18 mpg city, 27 highway for the V-6, 17/25 for the V-8. But Hyundai fans wanting to upgrade now have another reason to buy and to take pride in their ride.

By JOSH MAX
DAILY NEWS AUTO CORRESPONDENT

If you’d have done such a thing back in school, your teacher would have rapped your knuckles with a ruler and pronounced you impertinent.

But here comes South Korean automaker Hyundai with a big, rear-drive premium sedan that the car company brazenly compares to Mercedes-Benz, BMW, Lexus…

Where’s that ruler?

Easy on the knuckles, though. Is the 2009 Hyundai Genesis a Lexus, BMW or M-B? Probably not. Does it matter much? Probably not.

Genesis is better than most people need, and easily good enough for most of the rest of us.

Genesis’ excellence is surprising, because usually a car company’s first crack at a new segment is wanting.

For instance, Toyota’s 1993 T100 pickup, first try at an American-style pickup, was too small and lacked a V-8.

Only now, a decade-and-a-half and two generations of truck later, has Toyota hit the mark with its ultra-beefy Tundra (just when the bad economy dried up pickup sales, alas).

Genesis is Hyundai’s first big sedan and its only U.S. rear-drive model, and it offers the automaker’s first V-8. You can quibble with the timing — small cars and small engines are hot right now — but you can’t argue much against the execution.

Two Genesis test cars, a well-furnished V-8 and a lower-level V-6, were so right that it’s hard to find gripes. Hard, not impossible — though some beefs are pretty minor.

– Front seat didn’t go back far enough for some taller drivers.

– Ride felt bouncy on undulating pavement.

– Console-mounted joy-knob controller on the V-8 tester (like BMW’s iDrive) was simpler to use than most — so only mildly annoying. You still had to go through up to half-a-dozen motions just to assign a preset button to a radio station, for instance.

– The wood section on the steering wheel in the V-8, while handsome, was a reminder that wood is for decks and boats, not cars. Wood steering wheels are cold in winter, sweaty in summer, hard and slippery always. Leather, please.

– The V-8 was jerky on deceleration. To improve mileage, the fuel flow to the engine immediately shuts off when you coast. Nice idea, but a little too abrupt and obvious. Didn’t happen on the V-6, which is tuned differently.

– Mirror-mounted turn signals were annoyingly bright in the driver’s periphery. Move the signals half an inch to solve that. The driver doesn’t need to see them — they’re for the fool in your blind spot who can’t see your rear turn signal.

– Horizontal chrome strips across the dashboard and doors were designed not to mate where those panels adjoin, instead to leave a gap. The strips line up perfectly, but don’t run all the way to the edge of the dash or door. Odd.

To appreciate Genesis, you first have to like rear-wheel drive. Though the BMW and Mercedes-Benz models Hyundai wants to evoke are rear drive, many cars are front drive and have a different driving feel. Rear-drive cars feel more balanced in corners. On the other hand, weight isn’t concentrated over the driving wheels, as with front drive. That suggests worse slick-weather behavior. In the rain during testing, the back wheels spun briefly, but were well-reined-in by the traction-control systems — without abruptly cutting the engine power.

OK, you like rear drive. Now, what’s so special about Genesis? Glad you asked:

– Seats. Leather’s standard; so’s comfort. Back’s angled just so and leg and knee room are plentiful.

– Power. Base V-6 scoots nicely. New V-8 has that kind of always-increasing, never-ending power delivery that Infiniti favors.

– Ambiance. Trim, controls, gauges — elegantly done. Simple lines and curves. Nothing tortured.

– Styling. Smooth, well proportioned, not forced or wannabe. It’ll be as easy on the eye when the loan’s paid off as it is the day you drive it home.

– Safety features. A long list, including standard side-impact bags in the rear seat. Most automakers don’t offer those, and the ones that do charge extra.

– Brakes. Reassuringly firm, but not touchy. Others should copy.

– XM radio. One mode lists all the channels, handy for a satellite system that offers some 200. Makes it easy to find and try something different. No-brainer? Then why’s it rare?

– Persona. Genteel eagerness, backed up by a drivetrain and suspension that deliver.

No, it’s not cheap at $33,000 to $42,000, but neither is it outrageous by today’s standards.

Ignoring price, it’s a credible contender. Considering price, there might not be another car that’s such an all-around satisfier.

What stands out

-Smooth: Everything from the ride to the turn-signal lever.

– Swift: Hyundai’s first V-8 shouldn’t be its last.

-Seductive: Don’t drive unless you intend to buy.

2008 HYUNDAI GENESIS

– What? Full-size, four-door, rear-drive, premium sedan, V-6 or V-8. New to Hyundai lineup.

– When? On sale since late June.

– Where? Made at Ulsan, South Korea.

– Why? Premium car = premium image= premium profits.

– How much? V-6 starts at $33,000, including $750 shipping. V-8, $38,000. Loaded, $42,150.

– How powerful? 3.8-liter V-6 rated 290 horsepower at 6,200 rpm, 264 pounds-feet of torque at 4,500 rpm. 4.6-liter V-8 rated 375 hp at 6,500 rpm, 333 lbs.-ft. at 3,500. V-6 mated to Aisin six-speed automatic transmission; V-8 to ZF six-speed auto. Both have manual mode.

– How lavish? Pretty darned. Standard features include: stability control; anti-lock brakes with brake assist and brake-force distribution; front-impact, head-curtain and side-impact air bags in front and rear; automatic climate control; AM/FM/XM/CD/MP3 audio with input jack; leather upholstery; heated front seats; power steering, brakes, windows, mirrors, seats, locks; rear-window and outside mirror defrosters; cruise control; auto-on headlights; fog lights.

– How big? Small end of the full-size segment. A little shorter, wider than Toyota Avalon. Genesis is 195.9 inches long, 74.4 inches wide, 58.1 inches tall; 109.4 cubic feet passenger space, 15.9 cu. ft. trunk. V-6 weighs 3,748 pounds; V-8, 4,012 pounds. Rated to carry about 1,100 pounds of people, cargo. Turning circle listed as 36 feet.

– How thirsty? V-6 rated 18 mpg gallon city, 27 highway, 21 combined. V-8, 17/25/19. V-6 tester did 16.9 mpg in suburbs. V-8 showed 14.3 in suburb-city mix, 27 in 63 mph cruise-control highway driving, 16.9 in suburban, freeway mix. Tank holds 19.3 (V-6) or 20.3 (V-8) gallons. V-6 takes regular. V-8 needs premium for rated power; regular OK, cuts 7 hp, 9 lbs.-ft.

– Overall: Uncommonly good.

USA Today