Hyundai's Concept Genesis

Once known for building economy cars of dubious quality, Hyundai has been moving upscale with such well-appointed, near-luxury cars as its recently overhauled Santa Fe SUV and its all-new Veracruz SUV.

Hyundai's unveiling of its Concept Genesis prototype last week at the New York International Auto Show was a turning point in the company's history, because the Concept Genesis is the first Hyundai that is a bona fide luxury car--a sedan with faux-Lexus styling and the size of a BMW 5 Series. The prototype, which previews a production model that will go on sale next year, puts Toyota Motor (nyse: TM - news - people ) on alert: Hyundai is about to challenge not only Toyota but its upscale Lexus subsidiary as well.

The rear-drive Concept Genesis will spawn a car that will cost "well under $30,000," says Hyundai Motor America Vice President John Krafcik.

The other most important detail about the car is that it will feature a V-8 engine--the type of power plant widely used by such luxury automakers as Jaguar and Mercedes-Benz. The highest-caliber sedans, such as BMW's 7 Series and Mercedes-Benz's S-Class, use V-8 or V-12 engines, so Hyundai's first V-8 is a step into the big leagues for the automaker. Not even Acura has a V-8 in its lineup.

In a recent statement, Hyundai said the Concept Genesis' 4.6-liter V-8 delivers "well over 300" horsepower. The V-8 comes with a six-speed transmission, and in future applications, Hyundai could enlarge the engine or equip it with supercharging. "Concept Genesis," the company said, "marks the beginning of premium performance for the Hyundai brand," adding that the car has a zero-to-60 time of "well under six seconds."

Americans have never seen a rear-wheel-drive Hyundai before. Rear drive, in which the transmission sends the engine's power to the rear wheels, provides superior steering and sportier driving dynamics, compared with front-wheel drive. Premium sedans, such as the 7 Series and S-Class, are rear drive, as are such sports cars as Porsches and Ferraris.

Hyundai says the Concept Genesis uses "ultra-high-tensile steel" in its construction, giving the car a stiff, light, large body that compares favorably to those of BMW's 5 Series and Mercedes' E-Class midsize sedans. Hyundai also says it tuned the Concept Genesis' suspension to be sporty and responsive. The driver can select settings for the car's ride and steering characteristics.

The car also features such upscale amenities as adaptive cruise control, which can make the car follow the vehicle in front of it at a fixed distance; heated and cooled seats; a push-button starter; a navigation system with a rear-mounted camera to assist in parking; Bluetooth technology; and an Infinity audio system.

The Fact
The closest thing Hyundai has to a luxury sedan right now is its $25,000 Azera, which is one of the market's best values. The Azera has a 263-hp V-6 engine, and its interior volume compares favorably to that of the most expensive sedans from Mercedes and BMW. The Azera's interior looks remarkably like that of a Lexus and features standard upscale amenities, such as a leather-wrapped steering wheel and dual-zone climate control. Last year, Azera sales increased by 50% to 27,000 units.

Source @ Forbes