Price no longer defines luxury

Using the information from the leading national newspaper, USA Today, in an article titled “Price, size, fancy features no longer define luxury cars,” I argue a car can be considered a luxury car even if it's produced by a mainstream manufacturer or even if it's not very expensive as long as it has some amount of convenience, comfort, reliability, and performance they have.

Hyundai Equus Interior- www.moibbk.com

We live in a rapidly changing, fast paced world. Consumers’ tastes and interests can change in an instant. This constant shift in tastes widely affected the new car market, especially the luxury car market. Now, luxury cars aren’t just about size and branding. Luxury cars are about convenience, comfort, reliability, and performance; the vehicle must have a certain “feel” to it, and you know it when you feel it. Luxury cars can still be as ostentatious as a Rolls Royce, but now the luxury car market is being penetrated by seemingly mainstream brands, such as Hyundai or Kia. Consumers are expecting luxury cars to have more features, and we are beginning to see what some may call certain “ranges within the luxury segment.”

Previously, luxury cars were all about branding and history. Cadillac has clearly established itself as one of the oldest luxury car makers in the United States, recently celebrating its 113th anniversary this past August. Since then, Cadillac has definitely had some setbacks, such as the release of the Cimarron, but GM is always innovating in order to “maintain Cadillac’s luxury image.” Manufacturers have to tailor the cars to what the consumer needs, so producers like GM and Toyota create different options to suit the buyer. Toyota-owned Lexus has been seeing great sales after the release of the CT 200h, a hybrid hatchback car, starting just barely under $30,000. The fact that a luxury brand, such as Lexus, can offer a hybrid car that has a cheap price tag, in comparison with other models and manufacturers, and is quite small in size when compared to other Lexuses and luxury brands, shows that there really is a market for “cheaper,” more efficient luxury cars.

Other brands, like Hyundai and Kia, are releasing their version of luxury cars. Quite frankly, I think that these cars actually do fit into the luxury category even if they don’t have a luxury brand name. A Mercedes is still luxury even without the fancy logo. Luxury can be judged by branding, and most consumers buy their luxury cars like this, but in the end it all comes down to quality. If the performance and craftsmanship is appealing to the buyer, and it is apparent that the manufacturer took their time to consistently produce a product of high caliber, a car should be considered luxury. Thus, the definition of luxury hasn’t changed much, but rather manufacturers changed their production habits in order to offer and maintain certain level of luxury. Hyundai executive Steve Shannon stated that owners of high end Hyundais “‘are not embarrassed to say they own a Hyundai. We do focus groups, and people think they're in on a secret. There is almost a club of people that hope more people don't find out’ that Hyundai sells luxury sedans priced less than rivals.” Consumers are clearly satisfied with the alternative branding because even though it doesn’t have history, the build quality is consistent enough to land these “cheaper alternative” luxury cars into the luxury segment.

FUTURE RESEARCH: In my next blog post I will try to answer the question, "What features are usually included with luxury cars, and how and why do these features differ from economy cars?"