By on July 17, 2017

2017 BMW X1 white off road - Image: BMWDepending where you live, it’s possible the shift away from luxury cars to luxury SUVs is dramatically more apparent than America’s nationwide figures suggest.

In 48 of 50 states, luxury utility vehicles outsell luxury cars. In seven states, premium brand utility vehicles form more than 65 percent of the premium market.

But according to Edmunds, the two states in which luxury cars still outperform luxury utility vehicles account for 31 percent of America’s luxury SUV market.

California and Florida, massive auto markets for mainstream vehicles and premium vehicles, are particularly sunny locales. And in particularly sunny locales, a portion of the appeal of utility vehicles — all-wheel drive — is siphoned off by the sun.

Premium utility vehicles are making headway even with less-than-average assistance from car buyers in the extreme southwest and southeast of the United States. 56 percent of luxury brand vehicle acquisitions now occur on the light truck side of the ledger, as the popularity of luxury SUVs and crossovers causes premium auto brands to report relatively stable sales despite rapidly decreasing luxury car sales.

As recently as 2002, utility vehicles accounted for barely more than 20 percent of premium brand auto sales in America. That figure was above 30 percent in 2004, nudging 40 percent in 2010, and cresting 50 percent by the end of 2015.2018 Jaguar E-Pace - Image: JaguarNow we’ve reached the point where only a handful of premium brands — BMW, Mercedes-Benz, Jaguar, plus new-to-market Alfa Romeo and Genesis — sell more cars than SUVs/crossovers. With each of those brands planning more utility vehicles (X2 and X7 at BMW, for instance, plus the new E-Pace at Jaguar) it won’t be long until every premium auto brand generates more of their U.S. volume with SUVs and crossovers than cars.

Acura, Volvo, Lexus, Cadillac, Porsche, Infiniti, and Lincoln all produce more than 60 percent of their sales with utility vehicles.

“Luxury,” of course, is increasingly a difficult term to define. With premium brands marketing subcompact luxury crossovers, what is luxury? Mainstream brands have transaction prices for large SUVs rising above $60,000, Edmunds data shows, while subcompact luxury crossovers’ average transaction prices are at $38,000, in line with midsize SUVs/crossovers sold by mainstream brands.

That move downmarket has created massive conquest opportunities for premium auto brands. At 32 percent, the percentage of premium auto buyers who traded in a mainstream brand vehicle is at an all-time high in 2017, and half of the buyers in that subcompact luxury utility vehicle segment move over from a mainstream brand.

[Images: BMW, Jaguar]

Timothy Cain is a contributing analyst at The Truth About Cars and and the founder and former editor of Follow on Twitter @timcaincars.

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11 Comments on “Love for Luxury Cars in California and Florida Is Skewing National Luxury SUV Market Share...”

  • avatar

    No snow = no need for an SUV.

    Like AWD most people purchase SUVs because they think they need some specialized thing for challenging situations, like snow. Another reason one might want an SUV is some off-road fun, like in the mountains or desert. FL has none of the above so SUVs make little sense down here. CA at least has the terrain for it and snow at elevation.

    I wonder if Subbie’s sales are slowest in FL? Other then riced out WRXs I don’t see many normal Subaru’s down here. When I travel to the NE they catch my eye.

    • 0 avatar

      No snow =/= no need for an SUV. Don’t believe me? Head down to Birmingham, Mobile, Atlanta, or Memphis. SUVs are there en masse. The highest concentration of Toyota Land Cruisers I have ever seen is in Birmingham, Ala.

      Heck, even the majority of pickups down there seem to have shifted to the once rare for the South 4×4 models.

    • 0 avatar

      No wet onramps with TC off? Jeeez!

    • 0 avatar

      I suspect the persistence of luxury cars over CUVs/SUVs in Florida is largely due to demographic factors rather than the issues you mention. People buy CUVs/SUVs for a wide variety of reasons, many of which have little to do with bad weather or off-roading. Cargo capacity, seating capacity, higher seating position, more ground clearance, aesthetics… the list goes on.

      Florida has a lot of elderly drivers who grew up with traditional passenger cars and still feel more comfortable with them. That will delay the inevitable shift from cars to crossovers, but it will eventually come nonetheless as older generations pass on.

    • 0 avatar

      I think child seats have a lot to do with it. The more vertical seat positioning in SUVs allows for more room between the front and rear seats in SUVs, so it’s easier to fit a rear-facing car seat in one of them than in a car on the same platform.

  • avatar

    I live in a more rural of California, aka not the Bay Area or LA/SD, where luxury cars or SUVs are not that common.

  • avatar

    “Luxury,” of course, is increasingly a difficult term to define

    So is utility. According to Lexus, the RX is an SUV. I mean come on.

  • avatar

    Doubtful that many owners of larger mainstream branded vehicles have moved to a subcompact luxury branded vehicle unless they are recent empty nesters.

    And it goes both ways.

    There are owners of luxury branded sedans who have moved to loaded, full-size vehicles (SUVs or full-size CUVs) whether it be mainstream brands or premium brands like Buick or GMC.

  • avatar

    Manual = Luxury item. Even Ferrari can’t afford to them anymore.

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