Today’s consumers have been drawn to luxury vehicles for decades, with globally recognized brands like Tesla and Bentley creating new models with precise engineering, sleek designs, well-appointed interiors, and offering an overall sublime experience. Such premium features have made luxury automobiles coveted by consumers and meant more significant sales for original equipment manufacturers (OEMs). After years of steady growth and significant sales, the global luxury car market trends are here to keep that moving forward.
Driving Digital Disruption
Premium or affluent customers drive digital disruption, meaning more customer journeys in other digital and online segments. Just like other sectors selling various products, ranging from split comforter for couples to kitchen appliances-the luxury car-ownership journey is increasingly becoming digital, with consumers engaging with brands through different digital channels and platforms. The influence of today’s digital age has helped fuel the demands of premium consumers for convenient transactions and inquiries, making digital operations a big trend in 2021 and beyond.
The most notable trend in the global luxury car market is the popularization of fully electric cars, with global sales rising to a whopping 65% in recent years. This sudden growth of purchases and consumers’ ever-increasing demands can be attributed to several factors, including increasing environmental consciousness across all people and government incentives for electric car owners. However, the popularity of electric cars going mainstream can be credited to the upstart car manufacturer Tesla, a ‘real force’ in ensuring the adoption of electric vehicles.
Because of Tesla, the US luxury car market almost doubled to over 360,000 electric vehicles throughout the years, precisely thanks to Tesla’s Model 3 vehicle. It was the first time in the country that an electric car sold equally with the classic internal-combustion-engine car. When you combine all these factors, demand for electric vehicles has become a prominent part of the luxury automotive industry in 2021 and beyond.
However, it’s up for debate on how crucial this trend is to the luxury car sectors. Additionally, electric, hybrid, and other environmentally-friendly models have primarily been developed in combination with smart technologies by manufacturers globally, offering extra levels of desirability for many affluent consumers.
New Ways to Buy
No recent economic trend has had a more significant impact on how car buyers interact with brands than eCommerce. Although shopping online isn’t new, more brands are establishing innovative ways to buy and sell, like drop shipping and selling on the Facebook Marketplace-and these have shifted the playing field, forcing industries less accustomed to online retail to adapt. That said, the prominence of online shopping has become too massive to ignore, even in the premium global car market.
Although the concept of buying a car online has been around for half a decade, notable brands are only recently beginning to catch on, with experts predicting eCommerce spend on automotive reaching over $81 billion by 2022. More ‘big players’ in the industry are shifting their operations in eCommerce. Even if you don’t see a substantial number of premium cars shifting online, the sector can be boosted by eCommerce purchases of spare parts and accessories for the said automobiles, which is a crucial part of building a luxury car brand.
Most consumers today focus on sustainability, with the automobile industry being adamant about pushing on with self-driving models as the next big trend, and it’s certainly picking up. Manufacturers are continually moving toward the concept of self-driving luxury cars, with BMW and Daimler AG developing a self-driving automobile together in recent years. Experts and studies have cited this trend to experience significant growth in 2021 and beyond, with a prediction of having more than 10 million self-driving cars will be on the road in the next couple of years.
Although the numbers aren’t quite catching up, progress has been made, with more manufacturers being afforded countless opportunities to test their self-driving cars on the road.
Brands Remain on Top
Branding remains on top but is projected to evolve in the next few years. The concept of monolithic brands will face challenges from the lesser-known non-OEM manufacturers behind the proliferation of mobility services, which are starting to compete directly with top OEMs like Lamborghini or Lexus on brand. Additionally, OEMs adding more products, services, features, and partnerships will be challenged to retain their brands amid the increasing complexities in the sector-meaning better cars for affluent consumers.
For the last couple of years, the premium automotive industry has been growing steadily, with sales being lucratively high and consumer demands ever-increasing. The trends indicated only spells bigger things for the luxury car market this new decade-and beyond.