Hyundai, buoyed by evidence that its smaller models have wide acceptance, good scores among consumers and high resale value, is setting its sights on the luxury market.

Hyundai is now the seventh best-selling and third most fuel-efficient brand in the country. Its brand consideration numbers are up from 41 percent among consumers in 2005 to 52 percent in 2007.

Now, it's taking on its biggest challenge: The intensely competitive luxury car field, where buyers look to prestige, heritage and cachet.

To represent the brand, Hyundai has introduced the Genesis, a high-content, high-style rear-wheel-drive luxury sedan.

On paper -- and also in test drives, some say -- Genesis bests respected brands such as BMW and Mercedes, but is priced more like Pontiac G8 and Chrysler 300 -- the two brands it is targeted toward most with its $33,000 price tag for its base model.

The introduction of the Genesis comes as J.D. Power & Associates says Hyundai's new customer ratio is second to only Toyota in the industry -- for every one Hyundai defector, the automaker adds 2.2 new customers.

That's a remarkable feat for the company, which has fought hard in recent years for respect and consideration by American consumers after the introduction of Hyundai vehicles that far exceeded the mediocre early products of years past.

Perhaps the most risky aspect of Hyundai's luxury car launch is not the car itself, but that the brand has not built a new, separate dealer network for the Genesis as Toyota, Honda and Nissan did for their luxury brands, the Lexus, Acura and Infiniti, respectively.

Analysts say they run the risk of being ignored by prestige-conscious luxury car buyers who would eschew the notion of ever crossing the threshold of a Hyundai dealership to examine a Genesis. Those buyers, analysts say, want the heritage, cachet and widely recognized emblems that go along with the established luxury brands.

But that may not necessarily be the case. When talking with another industry observer, said Jack Nerad, editorial director of Kelley Blue Book, "one of the things he said was that he had found in research that the people who already had a luxury car were in some ways more receptive to Genesis than those who did not have a luxury car. The people who had luxury cars realized it wasn't a life-changer for them, while those who did not have a luxury car yet were the ones who were striving for prestige."

Hyundai officials at the launch of the Genesis say that, despite tremendous progress, there still are many consumers who either don't know about Hyundai or who still would not consider the brand. That helped the company conclude that going to the tremendous expense of launching a separate dealer network would not be a good idea, at least not now.

"It's usually very expensive to establish a separate dealership network for a new brand," Mr. Nerad said. "But I also think you can stretch a brand so far. To be offering vehicles that cost $10,000 or $20,0000 and others for $40,000 is quite a stretch."

Hyundai officials say that having the Genesis in Hyundai showrooms adds luster to the brand's other products, and provides evidence of just how far the brand has come.

They say that Hyundai has not completely ruled out the idea of eventually having a separate dealer network for the Genesis, and they hinted that the Genesis sedan and the soon-to-come Genesis coupe may not be the only entries the company has in the luxury field.

Given the possibility of opening a separate dealer network, the experience, knowledge and skills that Hyundai gains in dealing with the luxury buyer now could prove invaluable.

So, in a sense, the Genesis is something of a test bed for Hyundai, and a sumptuous, comfortable test bed it is.

Perhaps the biggest surprise is that the base model, Hyundai Genesis 3.8, powered by a 3.8-liter, 290-horsepower V-6, is plenty lively, raising the question of whether the larger 375-horsepower, 4.6-liter V-8 is even necessary.

In fact, during my testing, the V-6 was so fast, smooth and quiet that 80 miles per hour arrived in a flash, forcing a quick slowdown on a New York highway crowded with police cars.

Inside, the Genesis cabin is plenty spacious, with room to stretch out in front and cavernous space in the back. That's not surprising, given that the Genesis is several inches bigger than the Lexus GS models and Infiniti M series, and about the same size as the Pontiac G8 and Chrysler 300.

Standard equipment is generous, including full-power equipment, soft-touch instrument panel with wood grain accents, a multimedia controller for the navigation system, a rain-sensing wiper system, electronic stability- and traction-control systems, roof-mounted side curtain air bags, alloy wheels, cruise control, dual front fully automatic air conditioning and heating system, Bluetooth and other items.

Two interesting points: The Genesis 4.6 model has a Lexicon audio system; the only other brand to offer this is the Rolls-Royce Phantom. And two grades of leather are offered, with the upper model getting a buttery soft variety.

And in a real kicker, according to the Automotive Lease Guide, one of the bibles of the industry on resale values, the 3.8 model, with a 50 percent value after three years, exceeds the Lexus ES350 at 47 percent, BMW 535i at 42 to 47 percent, the Mercedes E 350 at 41 to 44 percent, and Infiniti M35 at 43 to 45 percent.

Meanwhile, in the Automotive Lease Guide, the Genesis 4.6 model outscores the Infiniti M45, Mercedes E550, Lexus GS460, BMW 550i and the Chrysler 300C and Pontiac G8 GT.

While agreeing that the Genesis was a strong competitor, some analysts questioned whether the Hyundai model really would be worth more than cars such as Lexus and BMW after three years.

At Kelley Blue Book, BMW's Three Series matches the Genesis at 51 percent after three years, but in later years, the residual values for the BMW prove stronger than the Genesis, Mr. Nerad said. And the Lexus ES has much higher resale value after three years, standing at 57 percent, compared with 51 percent for the Genesis.