Cain's Segments April 2014: Luxury Flagships

The impact of Mercedes-Benz’s W222 S-Class has been keenly felt in America’s luxury car sector. The S-Class’s most direct rivals have been shunned in favour of the venerable Benz over the last seven months. And yet there’s no denying that big luxury SUVs have cast a shadow over these flagship luxury cars, nor is there any point rejecting the idea that Tesla’s Model S is stealing market share.

Among the traditional players in its category, however, the S-Class rules the roost. In April, specifically, S-Class volume was up 73%, and sales were 168% stronger than the volume achieved by the second-ranked Lexus LS, sales of which moved up by twelve units, year-over-year.

Sales of the third-ranked 7-Series were down 23%. 7-Series volume has tumbled in seven consecutive months, incidentally. In September, just as Mercedes-Benz USA dealers were readying the new S-Class and sales of their big car had fallen 58% to just 387 units, BMW USA reported more than 1700 7-Series sales for the first time since June 2010. The 7-Series must also battle the more attractive and similarly-priced 6-Series Gran Coupe in BMW’s own showrooms. Sales of the whole three-pronged 6-Series lineup are up 63% to 4610 units year-to-date, although April sales slid 36% to 483.

The drop-off to the S-Class’s remaining European competitors is significant. Porsche sold 517 Panameras in April, 1983 so far this year, little more than a quarter of what the S-Class accomplishes. And while that April Panamera mark is up slightly compared with April 2013, its well off the pace achieved in each of the previous three Aprils. Panamera sales reached their highest annual levels in 2010, the first full year of availability, when 7741 were sold. Porsche is on pace for fewer than 6000 Panamera sales in 2014.

A8 sales figures continue to surprise reviewers who often favour the big Audi. April volume was down 5%. Relative to sales of Audi flagships, A8 sales in 2013 were particularly high at 6300 units, but the steady decline over the last eight months indicates a less exciting 2014 year end number from Audi. (A8 sales had increased, year-over-year, in seven of 2013’s first eight months.)

The Jaguar XJ, a car which attracted 10,552 buyers in 2004 even when the S-Type was generating annual sales above 10K, is simply not a nameplate with that kind of popularity these days. 2013 sales marked an eight-year high, but at 5434 units, XJ sales were half what Jaguar had achieved a decade earlier. XJ volume is up 21% over the last two months; up 19% since the S-Class began crushing rivals in October.

Yet the XJ’s decline from those highs a decade ago is not unique in this class. Even if Mercedes-Benz USA sells 20,000 S-Class sedans in 2014, a lofty goal indeed, that’ll be down 35% from the level achieved in 2006, the year the GL-Class SUV arrived. BMW sold more than 20,000 7-Series sedans as recently as 2003, but they’ll be lucky to sell 10,000 in 2014. 10,000 Lexus LS sales are within the realm of reason for 2014, but that’s well off the annual average rate of 26,668 sold between 2004 and 2008, the last time Lexus sold more than 20,000 copies.

And what of the Tesla? Presumably some, if not most, Model S buyers were in fact going to buy another car had the all-electric Tesla not been available. At the low end, the Model S may align itself more closely to the E-Class and 5-Series than the S-Class and 7-Series, but we mention it here for the sake of clarity. The Automotive News Data Center estimated at the beginning of May that Tesla sales totalled 8066 units through four months, but even HybridCars.com’s 5400-unit U.S. estimate for January-April is on the high end of many guesses reported in the electric car blogosphere. Tesla says the company delivered 6457 units, globally, in the first three months of 2014.

Don’t forget Kia.

The K900 found 260 April buyers; 365 since it went on sale in March. Hyundai Equus sales were up 9% to 285 in April; up 12% to 1203 over the last four months. Mercedes-Benz also sold 2045 CLSs so far in 2014, a 12% drop, and Audi A7 sales are up 7% to 2922. Maserati has reported 3332 total sales in 2014, a 342% year-over-year increase, but sales aren’t broken down by specific models.