(September 4, 2018) – Who buys a luxury vehicle, and why?
Is it just for prestige, pleasure and sport — a status symbol for the wealthy?
These are misconceptions from the past, says Matt Miller, general manager of Lexus of Edmonton, Alberta’s leading luxury automotive retailer. Luxury brands are getting more versatile, more rugged and more family-friendly — they are opening up the definition of “luxury” into every segment.
“Luxury brands have really expanded to reach out to different groups and demographics — we’re seeing a lot more options,” he says. “Whether it’s for driving out to the mountains or actually hauling a family around, luxury makers can now accommodate all those needs. In the past, I think there were less options — it was just high-end, expensive cars.”
Miller says strong demand for SUV and crossover models — especially in Edmonton, given the harsh weather extremes — has flooded the segment with models from all makers. But the assumption that a luxury SUV would be exorbitantly pricier than a mainstream SUV is yet another misconception, Miller says.
The simple fact is luxury starting prices already include deluxe features, whereas starting prices in another brand don’t.
“If you take that non-luxury vehicle and add leather, sunroof, navigation system and so on, that price comes closer to a luxury starter model than you actually think,” he says, “often even within a few thousand dollars.”
“When you’re just looking at that initial starting price on both models, it doesn’t really give a fair comparison.”
So what does a “luxury brand” mean today? Top-of-the-line engineering and performance; the best entertainment, technology and navigation systems; polished, plush interiors and elegantly refined exteriors. But the benefits of luxury brands go beyond finishes and features.
Last year’s Consumer Reports’ Brand Report Card — which determines “which brands consistently deliver cars that serve consumers well, (via) overall score, road-test score, and predicted reliability results” — ranked more than 30 automotive brands for 2017. Of the top five manufacturers, four were luxury brands.
J.D. Power’s 2017 U.S. Vehicle Dependability Study — which “measures the reliability of vehicles after three years of ownership” from more than 35,000 respondents — had two brands tied for first place: both were luxury makers. And again, rounding out the top five manufacturers, four were luxury brands.
Secondly — while already leading the pack in reliability — luxury manufacturers often boast longer and more comprehensive warranties than mainstream makers. And Miller says resale value is yet another benefit: a luxury brand comes with the cachet of the name, as well as a reputation for quality.
“In four or five years, the resale value of a luxury brand could be $10,000 more than a comparable, non-luxury vehicle,” he says. “So in essence — even though you may have paid more upfront — what it actually costs you to drive it, to maintain it, and what you can sell it for, it could actually be less in the end.”
“I think that’s something people might not look at,” Miller adds, “that kind of ‘first penny to last penny’ ownership cost of the vehicle.”
Lastly, luxury brands invest in you.
After performance, reliability and value — all that’s left is the experience itself. Modern luxury dealerships offer up white-glove service in every sphere: from spas to chauffeurs, relaxing lounges to business lofts, complimentary meals and other great amenities.
In a crowded and competitive automotive market, luxury manufacturers have prioritized the consumer in unprecedented ways.
“Luxury brands really provide an exceptional consumer experience,” Miller says. “Whether it’s the buyer experience, the servicing experience, the amenities and the dealership space, there’s definitely a difference.”