Thursday, 25 May 2017

The Premium Kitchen Hotting Up

Premium car sales are hotting up. Profits are sweet and volumes just keep climbing. How are the car making companies doing in this important sector? Let's look, going by nation or region but focusing on the volume area of premium.

Germany: The country with the most success. Audi, BMW, Mecedes Benz and Porsche are all doing well. They have had it too easy and others are going to start chipping away at their sales. Customers in the premium area are loyal and reputation is everything, so nothing drastic will happen. As sales rise, some of the growth will go elsewhere but overall German premiums will continue to do well.

The Evoque is showing how the right product sells 

Europe: Saab has gone and Volvo has lost ground to the leaders for over a few decades now. They are working at a revival but it will be measured, not frenetic. Alfa Romeo is about to be given a push into the market with gusto, but it is too soon to know how it will go. It looks promising. Land Rover have been surging forward lately with great success and now it is Jaguar's turn. For JLR we know it is working exceptionally well but the goal isn't to match say BMW's volumes any time soon.

Japan: Acura, Lexus and Infiniti some years ago burst on the scene, but only aimed at the US. Since then only Lexus has aspired to global coverage and that has been somewhat underwhelming (outside North America). Lexus is slowly changing that and now Infiniti is branching out with bold ambitions. Acura continues going nowhere internationally.

Lincoln is largely anonymous

USA: Cadillac, Lincoln and Imperial were the big three's premium makes and only two survive today. Cadillac is still limited worldwide and Lincoln even less so. They have been a low priority (it seems) for the car companies.

Summary: With Land Rover, Jaguar, Volvo, Alfa, Lexus and Infiniti all mounting serious moves in the premium segment, the traditional German brands are watching. With increasing sales, there is room for all of them. The last thing any of them need is to discount so as to either buy or maintain sales. Product will drive success.

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