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US Luxury Cars market report

Everything you need to make the right decisions

Providing the most comprehensive and up-to-date information and analysis of the Luxury Cars market, and the behaviours, preferences and habits of the consumer.

Mintel has the answers you’re looking for

What are the key challenges facing the industry and how fast are its rates of growth? Who is the consumer and what do they want? Where are the opportunities, where are the risks and what lies ahead?

Definition

This Report covers the sale of new domestic and imported luxury vehicles, consumer perceptions of luxury brands, and attitudes toward car ownership.

Sales figures throughout this Report apply to new luxury vehicles and do not include pre-owned vehicles.

Expert analysis from a specialist in the field

Written by Buddy Lo, a leading analyst in the Automotive sector, his extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

Luxury brands will need to gain market share for growth in a stagnant market, and Millennials will be the key demographic for success. Brands will need to not only compete with each other but also compete with entry-level brands as they become increasingly sophisticated and advanced driver safety systems gain widespread adoption across all brands. Buddy Lo
Automotive Analyst

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • Overview
          • The issues
            • Tariffs threaten to increase costs across the board
              • Figure 1: Total US sales and fan chart forecast of luxury vehicles, 2013-23
            • Cost continues to price out many enthusiastic shoppers
              • Figure 2: Luxury car shoppers, by household income, August 2018
            • Half of consumers think luxury cars are self-indulgent and high maintenance
              • Figure 3: Attitudes toward luxury cars, August 2018
            • The opportunities
              • Luxury shoppers show more immediate intent
                • Figure 4: Purchase intent, by intent to purchase luxury, August 2018
              • Urban Millennials will drive luxury vehicle sales
                • Figure 5: Intent to purchase luxury, by generation, August 2018
              • Luxury shoppers willing to pay more for comfort, convenience, and tech
                • Figure 6: Desired features, by intent to buy luxury, August 2018
              • What it means
              • The Market – What You Need to Know

                • Growth forecasted for the luxury market, depending on trade disputes
                  • Tariffs could stunt growing luxury segment
                    • Luxury share of the overall market continues to grow
                    • Market Size and Forecast

                      • Trade wars forecasted to impact short term sales
                        • Figure 7: Total US sales and fan chart forecast of luxury vehicles, 2013-23
                        • Figure 8: Total US sales and forecast of market, at current prices, 2013-23
                    • Market Breakdown

                      • Luxury market share grows to 14.4% in strong economy
                        • Figure 9: Market share of luxury vehicles, 2014-18
                      • SUVs and crossovers even more popular in luxury
                        • Figure 10: Total US unit sales of luxury vehicles, by segment, 2013-18
                        • Figure 11: Luxury SUVS and crossover market share, 2013-18
                      • Luxury brands overrepresented in plug-ins and battery electric vehicles
                        • Figure 12: Luxury brand market penetration as a percentage of total sales, by powertrain, 2017
                    • Market Perspective

                      • Mobility services continue to expand among urban consumers
                      • Market Factors

                        • Tariffs inject fear and uncertainty in auto market
                          • Economic indicators point to healthy economic growth
                            • Figure 13: Consumer confidence and unemployment, 2000-August 2018
                          • Rising interest rates increase costs for shoppers
                            • Figure 14: Effective federal funds rate, Sept 2013-Sept 2018
                        • Key Players – What You Need to Know

                          • Mercedes-Benz led luxury market in 2017 with 14% market share
                            • Jaguar brings two crossover models to market, with another on the way
                              • Tesla ramps up Model 3 production to 5K
                                • Besides the Navigator, Lincoln struggles continue in 2018
                                  • Lexus leads brands in SUV/crossover category
                                  • Brand Sales of Luxury Vehicles

                                    • Mercedes-Benz leads luxury market for 2017
                                      • Figure 15: Luxury sales by brand, 2017
                                    • Cheaper sports cars account for the bulk of sports/super car sales
                                      • Figure 16: Sales of specialty/sport luxury cars, by brand, 2017
                                    • German luxury brands dominate the luxury car segment
                                      • Figure 17: Sales of luxury cars, by brand, 2017
                                    • Lexus leads SUVs and crossovers in 2017
                                      • Figure 18: Lexus mobile ad, September 2018
                                      • Figure 19: Sales of luxury SUVs and crossovers, by brand, 2017
                                  • What’s Working?

                                    • Revamped Lincoln Navigator sales nearly double year-over-year
                                      • Crossovers across multiple brands gain double-digit growth rates
                                        • Tesla rockets past expectations in Q3 2018
                                        • What’s Struggling?

                                          • Lincoln crossovers struggle while category thrives
                                            • Passenger cars continue precipitous decline
                                            • What’s Next?

                                              • Additional crossover and SUV models roll onto dealership lots
                                                • BMW X7
                                                  • Lincoln shifts away from MK nomenclature with the Lincoln Nautilus
                                                    • Jaguar E-Pace & I-Pace
                                                      • Automation in luxury will warm consumer perceptions of the technology
                                                      • The Consumer – What You Need to Know

                                                        • High-earning urban Millennials prime luxury audience
                                                          • Luxury shoppers show more immediate purchase intent
                                                            • Maintaining a lifestyle is the main reason for buying luxury
                                                              • Luxury shoppers will pay more for tech in their vehicles
                                                              • Purchase Intent

                                                                  • Purchase intent shows slight increase
                                                                    • Figure 20: Purchase intent, August 2018
                                                                    • Figure 21: Purchase intent, July 2016-August 2018
                                                                  • High-income consumers show lower purchase intent
                                                                    • Figure 22: Purchase intent, by household income, August 2018
                                                                    • Figure 23: Vehicles in the household, by household income, August 2018
                                                                  • Major life events turn consumers to car shopping
                                                                    • Figure 24: Purchase intent, by major life events, August 2018
                                                                • Luxury Intent

                                                                  • Luxury consideration outpaces actual luxury vehicle sales
                                                                    • Figure 25: Intent to purchase luxury, August 2018
                                                                  • $75K+ show highest consideration for luxury purchase
                                                                      • Figure 26: Intent to purchase luxury, by household income, August 2018
                                                                      • Figure 27: Luxury car shoppers, by household income, August 2018
                                                                    • High-earning urban Millennials prime audience for luxury brands
                                                                      • Figure 28: Intent to purchase luxury, by generation, August 2018
                                                                      • Figure 29: Intent to purchase luxury, by area, August 2018
                                                                      • Figure 30: Profile of luxury car shoppers, August 2018
                                                                  • Luxury Shoppers in the Market

                                                                      • More immediate intent among luxury shoppers
                                                                        • Figure 31: Purchase intent, by intent to purchase luxury, August 2018
                                                                      • Luxury shoppers more likely to consider new
                                                                        • Figure 32: Purchase type, by intent to purchase luxury, August 2018
                                                                      • Leasing higher among luxury shoppers
                                                                        • Figure 33: Payment type, by luxury consideration, August 2018
                                                                      • Vehicle type consideration shows little variation among luxury shoppers
                                                                        • Figure 34: Vehicle types, by luxury consideration, August 2018
                                                                      • Luxury shoppers will be more independent in decision
                                                                        • Figure 35: Purchase responsibility, by luxury consideration and gender, August 2018
                                                                        • Figure 36: Marital status, by intent to buy luxury and gender, August 2018
                                                                        • Figure 37: Parental status, by intent to buy luxury and gender, August 2018
                                                                      • Luxury cars just as likely to drive children in family households
                                                                        • Figure 38: Driving responsibility, by intent to buy luxury, August 2018
                                                                    • Reasons for Buying Luxury

                                                                      • Luxury cars are a lifestyle purchase for many shoppers
                                                                        • Figure 39: Reasons for buying luxury, August 2018
                                                                      • Improving the driving experience will best resonate with coveted Millennials
                                                                        • Figure 40: Reasons for buying luxury, by generation, August 2018
                                                                      • Motivations for buying a luxury vehicle split on gender
                                                                        • Figure 41: Reasons for buying luxury, by gender, August 2018
                                                                    • Desired Features

                                                                      • Luxury shoppers would pay more for comfort, tech, and convenience
                                                                        • Figure 42: Desired features, by luxury consideration, August 2018
                                                                      • Millennials stand out among comfort, cargo, and passenger space
                                                                        • Figure 43: Desired features, by generation, August 2018
                                                                    • Luxury Brand Perceptions

                                                                      • German luxury brands lead consumer perceptions in multiple categories
                                                                        • Figure 44: Luxury brand perceptions, August 2018
                                                                      • Tesla shows improvement in tech perception and outperforms among youngest consumers
                                                                        • Figure 45: Luxury brand perception of tesla, by generation, August 2018
                                                                        • Figure 46: Tesla brand perception, August 2017-August 2018
                                                                      • Affordability perceptions can make up deficiencies among shoppers
                                                                        • Figure 47: Brand perceptions, by intent to purchase luxury, August 2018
                                                                      • Black consumers view traditional American luxury more favorably
                                                                        • Figure 48: Luxury brand perceptions, by race, August 2018
                                                                        • Figure 49: Luxury brand perceptions, by race, August 2018
                                                                    • Attitudes toward Luxury Cars

                                                                      • Nearly half of consumers find luxury vehicles a self-indulgent purchase
                                                                        • Figure 50: Attitudes toward luxury cars, August 2018
                                                                      • Views on luxury vehicles sour with age
                                                                        • Figure 51: Attitudes toward luxury vehicles, by age, August 2018
                                                                      • In-market shoppers have more positive views of luxury cars
                                                                        • Figure 52: Attitudes toward luxury cars, by intent to buy luxury, August 2018
                                                                      • Beauty and branding stand out among women luxury shoppers
                                                                        • Figure 53: Attitudes toward luxury cars, by intent to buy luxury and gender, August 2018
                                                                    • Appendix – Data Sources and Abbreviations

                                                                      • Data sources
                                                                        • Sales data
                                                                          • Fan chart forecast
                                                                            • Consumer survey data
                                                                              • Consumer qualitative research
                                                                                • Direct marketing creative
                                                                                  • Abbreviations and terms
                                                                                    • Abbreviations