Table of Contents
Executive Summary
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- The market
- Luxury car market estimated to top 2.5 million units
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- Figure 1: Total US unit sales and fan chart forecast of Luxury cars, 2009-19
- Entry-level luxury cars now most common vehicle
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- Figure 2: Total US unit sales of new luxury vehicles, by segment, 2012 and 2014
- Key players
- Four luxury brands represent nearly 50% market share
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- Figure 3: Top 4 luxury car brands, July 2013-2014
- The consumer
- Luxury buyers want new and improved technology
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- Figure 4: Reasons for wanting another vehicle, by luxury car intenders, May 2014
- Young consumers twice as likely to buy compact cars
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- Figure 5: Luxury car purchase intenders by vehicle body style consideration, by age, May 2014
- Luxury car buyers want reliable maintenance and warranties
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- Figure 6: Incentives and service features important to new vehicle intenders, May 2014
- Tech and audio features more likely to influence luxury buyers
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- Figure 7: Tech and audio features important to luxury vehicle intenders, May 2014
- Opportunity for developing technologies to attract luxury car buyers
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- Figure 8: Interest in developing technologies, functionality, features, and services when purchasing next new luxury car, May 2014
- What we think
Issues and Insights
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- What is next for entry-level luxury buyers?
- The issues
- The implications
- What “next-gen” technology resonates with luxury car buyers?
- The issues
- The implications
- Should luxury dealerships embrace a “no-pressure” environment?
- The issues
- The implications
Trend Application
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- Trend: Life Hacking
- Trend: Return to the Experts
- Trend: Prepare for the Worst
Market Size and Forecast
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- Key points
- Luxury car market estimated to top 2.5 million units
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- Figure 9: Total US unit sales and forecast of new luxury vehicles, 2009-19
- Luxury cars account for 15.5% of market
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- Figure 10: Total US unit sales and forecast of total new vehicles and new luxury vehicles, 2009-19
- Fan chart forecast
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- Figure 11: Total US unit sales and fan chart forecast of Luxury cars, 2009-19
Market Drivers
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- Key points
- Aging US fleet helps create demand from new luxury buyers
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- Figure 12: Average age of light Vehicles, 2002-13
- Rise in median home prices increases luxury consumption
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- Figure 13: Median existing home prices vs new light vehicle sales, 2002-13
- High gas prices may pave way for more hybrid luxury vehicles
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- Figure 14: All grades all formulations retail gasoline prices, 2000-14
- Monthly payments made more affordable by leasing, but headwinds appear
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- Figure 15: New lease share of new vehicle financing, 2009-13
Segment Performance
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- Key points
- Entry–level luxury cars now most common vehicle
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- Figure 16: Total US unit sales of new luxury vehicles, by segment, 2012 and 2014
Segment Performance – Near-luxury
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- Key points
- Near-luxury vehicle sales stable
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- Figure 17: Total US unit sales of near-luxury vehicles, 2009-14
- Near-luxury crossovers and SUVs drive category
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- Figure 18: Total US unit sales of near-luxury vehicles, by category, 2009-14
Segment Performance – Entry-level Luxury
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- Key points
- More affordable luxury brands selling fast
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- Figure 19: Total US unit sales of entry-level luxury vehicles, 2009-14
- Entry-level luxury car and crossover sales equally strong
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- Figure 20: Total US unit sales of entry-level luxury vehicles, by category, 2009-14
Segment Performance – Mid-level Luxury
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- Key points
- Mid-level luxury vehicles account for one third of new sales
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- Figure 21: Total US unit sales of mid-level luxury vehicles, 2009-14
- Crossover/SUV sales drive segment
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- Figure 22: Total US unit sales of mid-level luxury vehicles, by category, 2009-14
Segment Performance – Elite Luxury
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- Key points
- Elite luxury sales growth estimated to cool in 2014
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- Figure 23: Total US unit sales of elite luxury vehicles, 2009-14
- Crossovers less prominent in elite luxury category
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- Figure 24: Total US unit sales of elite luxury vehicles, by category, 2009-14
Segment Performance – Exotic Cars
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- Key points
- Corvette drives exotic luxury segment to strong growth
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- Figure 25: Total US unit sales of exotic cars, 2009-14
Leading Companies
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- Key points
- Four luxury brands represent nearly 50% market share
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- Figure 26: Top 10 luxury car brands, July 2013-2014
- Competing in segment, BMW gains share with 3-Series
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- Figure 27: BMW luxury car sales, by model, July 2013-2014
- Mercedes-Benz sees growth in higher-end models
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- Figure 28: Mercedes-Benz luxury car sales, by model, July 2013-2014
- Having survived, Lexus looks to thrive
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- Figure 29: Lexus luxury car sales, by model, July 2013-2014
- GMC builds crossover/SUV vehicles only in near-luxury segment
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- Figure 30: GMC luxury car sales, by model, July 2013-2014
- Buick looks to smaller vehicles to attract new audience
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- Figure 31: Buick luxury car sales, by model, July 2013-2014
- Audi makes splash with diesel
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- Figure 32: Audi luxury car sales, by model, July 2013-2014
Innovations and Innovators
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- Tesla releases downloadable software upgrade for Model S
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- Figure 33: Tesla Model S software Update
- Multiple smartphone integrations sure to entice buyers
- Headlight innovations go easily noticed by consumers
- Apple, Google enter integrated dashboards
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- Figure 34: Apple CarPlay
- Figure 35: Android Auto
Marketing Strategies
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- Mercedes-Benz launches GLA on Instagram
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- Figure 36: Mercedes-Benz Instagram ad, “#GLAPacked,” 2014
- Audi makes no compromise in launching A3 like a champion
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- Figure 37: Audi television ad, “Dues,” March 2014
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- Figure 38: Audi television ad, “Touch,” March 2014
- Lexus marks performance with “F”
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- Figure 39: Lexus television ad, “Temptation,” June 2014
- BMW builds bobsled for 2014 Olympic Winter Games
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- Figure 40: BMW television ad, “Hello Future,” February 2014
Luxury Car Buyers
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- Key points
- Most luxury car buyers have one or two vehicles
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- Figure 41: Number of household vehicles owned by luxury car intenders, May 2014
- Luxury car buyers already own passenger cars
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- Figure 42: Vehicle types already owned by luxury car intenders, May 2014
- Luxury car intenders approach buying process independently
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- Figure 43: Who will be responsible for the purchase of the next luxury vehicle, May 2014
Price Paid for Recently Purchased Vehicle
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- Key points
- Buying luxury vehicle is a step up in price for most consumers
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- Figure 44: Price paid for most recently purchased vehicle, May 2014
- In market segmented by price, high-end buyers represent 20%
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- Figure 45: Price paid for most recently purchased vehicle, by household income, May 2014
- On average, luxury car buyers expect to pay $40,000
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- Figure 46: Expected total price of next new car, May 2014
New, Used, or CPO Luxury Vehicles in Household
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- Key points
- Luxury car buyers want new cars, but CPO trend rising
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- Figure 47: Luxury vehicle intenders by whether vehicle will be purchased new, used, or CPO, May 2014
- Men more likely to buy new
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- Figure 48: Luxury vehicle intenders by whether vehicle will be purchased new, used, or CPO, by gender, May 2014
- More affluent luxury car buyers plan to buy new
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- Figure 49: Luxury vehicle intenders by whether vehicle will be purchased new, used, or CPO, by household income, May 2014
When Will Luxury Vehicle Purchase Occur?
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- Key points
- Men more likely to buy soon
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- Figure 50: Approximately when will the next luxury vehicle purchase occur, by gender, May 2014
- Parents expecting to buy luxury cars soon
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- Figure 51: Approximately when will the next luxury vehicle purchase occur, by presence of children in household, May 2014
- Some 18-34s expect to buy within 30 days
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- Figure 52: Approximately when will the next luxury vehicle purchase occur, by age, May 2014
Motivators for Purchase of Luxury Vehicle
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- Key points
- Luxury buyers want new and improved technology
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- Figure 53: Reasons for wanting another vehicle, by luxury car intenders, May 2014
- Luxury car buyers desire technology regardless of income
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- Figure 54: Reasons for wanting another vehicle, by luxury car intenders, by household income, May 2014
Luxury Vehicle Types Considered
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- Key points
- Luxury car intenders prefer mid- and full-sized cars
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- Figure 55: Luxury car purchase intenders by vehicle body style consideration, by gender, May 2014
- Crossovers/SUVs suitable as a family car
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- Figure 56: Luxury car purchase intenders by vehicle body style consideration, by presence of children in household, May 2014
- Young consumers twice as likely to buy compact cars
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- Figure 57: Luxury car purchase intenders by vehicle body style consideration, by age, May 2014
Monthly Payment versus Total Cost
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- Key points
- Nearly half of luxury car intenders focus on total price
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- Figure 58: Monthly payment or total price on next luxury vehicle, by household income, May 2014
- Many younger car buyers focused on monthly payments
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- Figure 59: Monthly payment or total price on next luxury vehicle, by age, May 2014
Incentives and Service Features Important to Luxury Vehicle Intenders
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- Key points
- Luxury car buyers want reliable maintenance and warranties
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- Figure 60: Incentives and service features important to new vehicle intenders, May 2014
- Women more focused on financial implications when buying luxury cars
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- Figure 61: Incentives and service features important to new vehicle intenders, by gender, May 2014
- Attractive incentives and service depends on household income
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- Figure 62: Incentives and service features important to new vehicle intenders, by household income, May 2014
- Warranties most attractive to older car buyers
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- Figure 63: Incentives and service features important to new vehicle intenders, by age, May 2014
Styling and Comfort Features Important to Luxury Vehicle Intenders
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- Key points
- Luxury car buyers more likely to want most styling and comfort features
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- Figure 64: Styling and comfort features important to new vehicle intenders, May 2014
- Women want comfortable, heated seats
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- Figure 65: Styling and comfort features important to new vehicle intenders, by gender, May 2014
- Older luxury car buyers want creature comforts
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- Figure 66: Styling and comfort features important to new vehicle intenders, by age, May 2014
Tech and Audio Features Important to New Vehicle Intenders
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- Key points
- Tech and audio features more likely to influence luxury buyers
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- Figure 67: Tech and audio features important to luxury vehicle intenders, May 2014
- Men influenced by touchscreen, multimedia
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- Figure 68: Tech and audio features important to luxury vehicle intenders, by gender, May 2014
- HD radio, rear-seat entertainment opportunities for entry-level segment
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- Figure 69: Tech and audio features important to luxury vehicle intenders, by household income, May 2014
- Smartphone connectivity represents next generation of desired tech
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- Figure 70: Tech and audio features important to luxury vehicle intenders, by age, May 2014
Safety Features Important to Luxury Vehicle Intenders
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- Key points
- Luxury car intenders more influenced by technology in safety features
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- Figure 71: Safety features important to new vehicle intenders, May 2014
- Parents seek automated safety features
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- Figure 72: Safety features important to new vehicle intenders, by presence of children in household, May 2014
Top Vehicle Brands Seriously Considered by Luxury Car Intenders
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- Key points
- Luxury brands less popular than household names
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- Figure 73: Top vehicle brands considered by those considering a luxury car, May 2014
- Men more likely to consider domestic luxury car
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- Figure 74: Top vehicle brands considered by those considering a luxury car, by gender, May 2014
- Women less interested in origin of brand
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- Figure 75: Type of luxury vehicles most likely to purchase, by gender, May 2014
Interest in Developing Technologies, Functionality, Features, and Services When Purchasing Next New Luxury Car
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- Key points
- Wireless charging appeals to all, other new tech sought by luxury buyers
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- Figure 76: Interest in developing technologies, functionality, features and services when purchasing next new luxury car, May 2014
Attitudes of Luxury Car Intenders toward Various Emerging Makes, Models, and Features
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- Key points
- Acura and Cadillac perceived in same tier as BMW, Mercedes-Benz
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- Figure 77: Attitudes of luxury car intenders toward various emerging makes, models and features, by gender, May 2014
- More affluent luxury car buyers see foreign brands as more luxurious
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- Figure 78: Attitudes of luxury car intenders toward various emerging makes, models and features, by household income, May 2014
Race and Hispanic Origin
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- Figure 79: Household ownership of main luxury brand vehicles, by race/Hispanic origin, April 2013-June 2014
- Figure 80: Select attitudes and opinions about cars, by race/Hispanic origin, April 2013-June 2014
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- Figure 81: Decision makers for automobiles purchased in the past year by household for luxury car buyers, by race/Hispanic origin, April 2013-June 2014
- Figure 82: When next new vehicle will be purchased by luxury car buyers, by race/Hispanic origin, April 2013-June 2014
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Appendix – Other Useful Consumer Tables
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- Who will be responsible for luxury purchase
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- Figure 83: Who will be responsible for the purchase of the next luxury vehicle, by area, May 2014
- Type of most recently purchased vehicle
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- Figure 84: Type of most recently purchased vehicle, May 2014
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- Figure 85: Type of most recently purchased vehicle, by gender, May 2014
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- Figure 86: Type of most recently purchased vehicle, by household income, May 2014
- New, used, or CPO
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- Figure 87: Luxury vehicle intenders by whether vehicle will be purchased new, used, or CPO, by age, May 2014
- When will next luxury vehicle purchase occur?
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- Figure 88: Approximately when will the next luxury vehicle purchase occur, May 2014
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- Figure 89: Approximately when will the next luxury vehicle purchase occur, by household size, May 2014
- Reasons for wanting another vehicle
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- Figure 90: Reasons for wanting another vehicle, by luxury car intenders, by age, May 2014
- Vehicle body style consideration
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- Figure 91: Luxury car purchase intenders by vehicle body style consideration, May 2014
- Monthly payment or total price
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- Figure 92: Monthly payment or total price on next luxury vehicle, May 2014
- Type of luxury vehicle most likely to purchase
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- Figure 93: Type of luxury vehicles most likely to purchase, by household income, May 2014
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- Figure 94: Type of luxury vehicles most likely to purchase, by age, May 2014
- Top vehicle brands considered
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- Figure 95: Top vehicle brands considered by those considering a luxury car, by age, May 2014
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- Figure 96: Top vehicle brands considered by those considering a luxury car, by household income, May 2014
- Interest in developing technologies
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- Figure 97: Interest in developing technologies, functionality, features and services when purchasing next new luxury car, by age, May 2014
- Attitudes toward emerging makes, models, and features
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- Figure 98: Attitudes of luxury car intenders toward various emerging makes, models and features, by age, May 2014
Appendix – Trade Associations
Appendix – Market Segment Classification
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- Figure 99: Segment classification, by make and model – Elite-luxury, 2014
- Figure 100: Segment classification, by make and model – Entry-level, 2014
- Figure 101: Segment classification, by make and model – Exotic, 2014
- Figure 102: Segment classification, by make and model – Mid-Luxury, 2014
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- Figure 103: Segment classification, by make and model – Near-Luxury, 2014
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