The state of the luxury car market in 2014
With the economy continuing to show clear signs of a recovery in 2013, luxury car manufacturers adjusted their plans for growth as they prepared for what could be the biggest year for business in decades. Indeed, although their industry has been hampered by the onset of the recession in 2008, evidence suggests the flood of new car buyers has returned and many have their eyes fixed on a luxurious purchase.
Early figures from the Society of Motor Manufacturers and Traders (SMMT) proved they were right to go into the year ahead with a spring in their step. The group showed a 6.1 per cent rise in UK car sales over January and February 2014 compared to the first two months in 2013, which maintained the trend of a growth in sales during every month since 2012.
The SMMT highlighted that family favourites like the Ford Fiesta, Vauxhall Corsa and VW Golf are still the most popular cars in Britain, though many luxury models also made the top 20 for units sold. The BMW 3 Series was the eighth best-selling motor of 2013, with the Audi A3 and Mercedes C Class following closely behind. Analysts believe Brits are now far more inclined to go with a pricier solution as the economy dusts itself down and this plays very much into the hands of the luxury market.
Britain leads the way, but not for long
Strong sales of luxury vehicles in Britain have more than pleased the global market over the last two years, encouraging more manufacturers to target the UK with their new productions. However, certain companies have grown worried about this spike failing to translate to success across the continent, which is being held back by the state of the market in former crisis spots like Portugal, Italy and France.
However, this could all be soon to change, with several manufacturers seeing a lift in sales across Europe in early 2014. Hyundai is one of the many companies hoping for success across the continent and has predicted a three per cent rise in vehicle sales over the year. At the very least, this will take the pressure off Britain to contribute so much to new vehicles sales.
Manufacturers are also seeing a change in their clientèle. As such, they may switch focus from smooth and sleek to cool and edgy with their marketing campaigns.
On February 14, British car giant Jaguar announced that it would be looking to broaden the appeal of its brand beyond "older blokes" in the hope of attracting "more youthful" customers. Upon the launch of its sporty F-Type model, the group hired Chelsea boss Jose Mourinho as a global brand ambassador in order to make the company appear more contemporary and "of the moment".
Whether this approach pays off for Jaguar is anyone's guess, but the company's attempts at switching its target market speak volumes about the type of people who are investing in premium motors. Manufacturers are increasingly seeing younger motorists as a target, with Asian buyers thought to be leading the trend.
Luxury goes bigger
Not only are their target audiences changing, the shape of the luxury car has also gone under some serious work.
A number of manufacturers have turned to producing SUVs as they look to capitalise on a market in which Land Rover reigns supreme. Companies are betting that affluent buyers will opt against low-slung saloons for something a little bigger in size and stature, not to mention more spacious on the inside.
Executives are viewing 2014 as the year of the crossover, but this will only pay off for companies who manage to find the right matches for their blends.
For instance, while the sedan and SUV cross has inspired cars like the Porsche Macan and the BMW X6, very few have opted for a mix between the SUV and pick-up truck. Luxury buyers are now after big cars but with enough compactability for them to zip around the city centre with ease. It's a tough balance to strike, admittedly, but one which could reap great returns.
As luxury manufacturers typically charge more for their products, they can afford to include the most advanced technology in their new releases. However, former high-end novelties like infotainment, bluetooth hands-free sets and start/stop buttons are now present in the cheapest of vehicles, leaving luxury manufacturers with the tricky task of developing a fresh batch of lavish features to justify the cost of their cars.
Some companies have gone overboard with their additions, like Mercedes-Benz with its fragrance dispenser for the new S-Class and Hyundai with its backseat champagne cooler for its Equus model. Other have focused on providing better safety for its customers, while voice-powered technology such as Apple's CarPlay has enabled vehicles to become even more connected to their drivers.
Still, buyers always have the option of adding certain features themselves. Car tracking systems, for example, can be added after the vehicle has been purchased and may help owners gain peace of mind when it comes to leaving their car unattended.
Battle for supremacy
As for who will come up trumps in 2014, few can look past the German trio of BMW, Mercedes and Audi, who will all contend for the global lead in luxury car sales over the course of the year.
BMW made sure it topped the pile going into 2014 with global sales of 1.66 million vehicles in the year before. This was fuelled by demand for the 3-series sedan and X1 compact sport-utility vehicle, although an 8.3 per cent rise in sales for Audi up to 1.58 million vehicles gave the manufacturer something to think about. Elsewhere Mercedes reached an all-time high in global deliveries but was unable to match the two for units sold.
Each company is planning on a number of releases for 2014, while the likes of Bentley, Jaguar and Land Rover prepare to steal the German thunder where possible. Overall, it's set to be a very interesting year to behold.