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Tuesday
Apr022013

From Luxury to Premium

Have you noticed that some established luxury manufacturers are starting to migrate from luxury to premium. Agreed we have to wonder what premium is all about, in a an environment of diluted luxury.

For the past several years we have seen established luxury manufacturers (we all know who they are) in North America embark on an inexorable march towards lower prices, and more attainable vehicles. Is it a classic case of the democratisation of luxury?

If every manufacturer can build a good vehicle for a specific price point, obvious its the "luxury brand" that has a greater appeal that the actual product.

If manufacturers want to build vehicles to a lower price segment, at some point they have to cross the chasm from rear wheel drive (luxury) to front wheel drive (economy). On the premise that the brand will still carry the same value in a front wheel drive configuration. Accompanied by the reality that the upcoming generation of vehicle buyers want lower priced vehicles which have morphed from luxury to premium.

We all know that a lower price point, usually entails higher production and sales volumes.

It will be captivating to see how the various strategies, and tactics of several manufacturers will develop and play out in the coming years.

What do you think? Leave a comment.

 

 

 

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