Global Luxury Car Market - 2023-2030

Market Overview

Global Luxury Car Market reached US$ 672.4 billion in 2022 and is expected to reach US$ 1,032 billion by 2030, growing with a CAGR of 5.5% during the forecast period 2023-2030.

The luxury cars market is witnessing continued evolution, with new designs, product launches and the emergence of new players. With sustained income growth in rapidly developing regions, such as Asia-Pacific, the global luxury cars market. Emerging regions are expected to become the main source of growth for the global market during the forecast period.

Nearly all major luxury car manufacturers are moving towards the full-fledged adoption of electric vehicles (EVs). The introduction of EVs into their product lineup also allows carmakers to introduce new automotive technologies. According to estimates, EVs are expected to account for 50 to 60% of all luxury vehicle sales by 2030.

Market Dynamics

Expansion of Leasing Programs By Luxury Car Manufacturers

One of the biggest worries for aspirational luxury car buyers is the high cost of ownership. Luxury cars require extensive servicing and maintenance to keep them in optimum condition. The high maintenance costs can act as a potential barrier for new buyers. To overcome this, luxury carmakers are expanding their offerings of attractive leasing options.

Companies offer leasing for a period of 24 to 48 months, with lower monthly payments as compared to purchase financing. The monthly payments factor in maintenance and servicing costs. At the end of the leasing period, the customer can choose to either extend the lease or lease another vehicle with similar attractive terms. The expansion of leasing programs by luxury carmakersexpands their potential client base and creates new growth opportunities.

Introduction of New Trim Levels in Luxury Car Models

In order to expand their potential customer base and increase interest in their brand, luxury car manufacturers are refreshing their product lineups with new launches. Mass market luxury car manufacturers such as Mercedes Benz, BMW and Audi are expanding their product portfolio by introducing more entry level models to attract aspirational first time buyers.

Furthermore, luxury car manufacturers are also increasing the trim levels in their existing models. Increasing trim levels creates a sizeable price differential between two cars of the same model, with the lower trim level being positioned as a more appealing option for buyers. The introduction of new trim levels at varying price points presents new growth opportunities for car manufacturers.

Changing Consumer Preferences

Modern high-density urbanization has led ot changing lifestyles, leading to a shift in consumer preferences. In densely populated cities, parking constraints, traffic congestion and the availability of efficient public transportation systems have made luxury car ownership less desirable for some high-income consumers.

Furthermore, the rise of app-based luxury cab services, such as Uber Lux has also impacted consumer preferences. Many consumers, particularly in urban areas, are choosing to rely on these services instead of owning and operating luxury cars. The shift towards shared alternative mobility solutions has reduced the demand for luxury vehicles.

COVID-19 Impact Analysis

The COVID-19 pandemic led to temporary closure of car factories resulting in production disruption. The disruptions resulted in delays in the manufacturing and delivery of luxury cars, affecting the availability of models and options for customers. The pandemic led to a shift towards digital platforms and online car buying. Luxury carmakers adapted to the pandemic by increasing their online presence, offering virtual showrooms and providing customers with contactless delivery options.

In the aftermath of the pandemic, luxury car sales witness a strong rebound in all major markets, mainly due to the pent-up demand accumulated during the pandemic. With consumer demand remaining strong and in anticipation of major growth over the coming years, companies are gradually expanding their product lineup with new launches.

AI Impact Analysis

Luxury carmakers are investing significantly in AI-powered technologies such as machine learning algorithms and computer vision systems to enable advanced driver-assistance features and autonomous driving capabilities. Autonomous driving technology offers enhanced convenience to luxury car owners.

Luxury cars are currently integrating AI-driven infotainment systems that offer voice recognition, and personalized content recommendations. AI-powered connectivity features allow car owners seamless integration with smartphones, smart home devices, and other digital services, for greater convenience.

Russia- Ukraine War Impact Analysis

The Russia-Ukraine war has not had a major impact on the global market beyond the two affected countries. With widespread destruction over the course of the war and a large population fleeing the country, the luxury car market in Ukraine was completely disrupted and is unlikely to be revived during the short and medium term.

The strong economic sanctions imposed on Russia for its involvement in the war have greatly impacted its domestic luxury car market. Almost all major luxury car manufacturers have ceased local production and have halted car exports to Russia. It has created a thriving demand for grey market to ship new and used luxury cars to Russia.

Segment Analysis

The global luxury cars market is segmented based on vehicle type, propulsion and region.

Sports Utility Vehicles (SUVs) are the Most Preferred Type of Luxury Vehicle

Luxury sports utility vehicles (SUVs) have become a major status symbol due to their commanding road presence. SUVs also offer several practical features such as large and spacious interiors and cargo carrying capacity. Luxury SUVs also offer high-end infotainment systems, premium sound systems, luxurious leather upholstery, panoramic sunroofs and sophisticated interior trims.

The growing consumer preference for luxury SUVs has led to major developments in the global market. Many high-end luxury carmakers such as Lamborghini, Ferrari, Rolls-Royce, Bentley and Aston Martin have launched their first-ever SUV models in order to cater to growing consumer demand. SUVs will continue to remain a popular choice for consumers in the coming years.

Geographical Analysis

Middle East and Africa is a Promising Region for the Global Market

Middle East and Africa are expected to grow at a faster CAGR of 6.5% during the forecast period. The middle east has emerged as a major market for luxury cars over the last decade mainly due to large oil wealth. Furthermore, due to low taxes on goods and no taxes on personal income, countries such as the United Arab Emirates (UAE), Qatar, Kuwait and Bahrain have become attractive destinations for expatriate high net worth individuals, further fueling the demand for luxury cars in the region.

The middle east is also a popular destination for countries in Africa to import luxury cars due to its low tax regime. Official dealership networks for luxury cars are poorly developed in Africa mainly due to the region's high poverty and low demand. However, with high economic growth rates, some African countries are expected to reach middle income status in the coming decade. It could provide major opportunity for the expansion of the luxury car market in the region.

Competitive Landscape

The major global players include Volkswagen Group, BMW Group, Mercedes-Benz Group AG, General Motors, Ferrari S.p.A., Tesla, Inc., Tata Motors, Aston Martin, Toyota Motor Corporation and China FAW Group Co. Ltd.

Why Purchase the Report?

• To visualize the global luxury car market segmentation based on vehicle type, propulsion and region, as well as understand key commercial assets and players.
• Identify commercial opportunities by analyzing trends and co-development.
• Excel data sheet with numerous data points of luxury cars market-level with all segments.
• PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Product mapping available as Excel consisting of key products of all the major players.

The global luxury car market report would provide approximately 50 tables, 50 figures and 190 Pages.

Target Audience 2023

• Manufacturers/ Buyers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies