By on December 8, 2017

Ding dong, fake luxury is dead. I should be more specific — I don’t mean Fake Luxury in the Caddy-Calais-vs-Ninety-Eight-Regency sense. I mean just plain old fake luxury. You know what fake luxury is. Invicta watches, Michael Kors suits, everything you could possibly buy at the Pottery Barn or in most American malls. Mass-produced sweatshop junk gilded and pimped for the administrative assistant nervously considering how to spend a $250 Christmas bonus.

Real luxury is on a roll everywhere from Savile Row to Maranello, swept away on a wave of Gilded Age cash and the ever-increasing leverage power of capital, but fake luxury is in a tailspin. Patek and Vacheron will thrive, Rolex will hold steady, Breitling will collapse. Airlines are feverishly revamping their widebodies into “super-high-J” configurations, replacing rows of packed prole seats with sleeper beds and sliding-door suites. It’s a good time to be a private jet pilot, a good time to be an UberPool driver, hell on earth to be anything in between.

Two weeks ago I told you about the Chinese Volvo S90, the Volvo S90 that is built in China. It’s the equivalent of a department store suit “designed in Sweden” but constructed by the lowest bidder. I told readers on my site that the market would adjust for this, that the price of Chinese Volvos would quickly drop into the basement while Swedish Volvos stayed strong.

I was right, young Skywalker… about a great many things.


You can argue the precise mechanisms of internecine placement, but few doubt that there are two distinct tiers of mass-production “luxury” automobiles in the marketplace. The first tier consists of vehicles which require no explanation and no excuses when displayed to neighbors or rivals. It consists of Mercedes-Benz, BMW, Audi, and Lexus. Not everything they make is admirable and not everything they make is class-competitive but that’s like saying that Sub-Zero refrigerators aren’t always the quickest-chilling options out there. Nobody wants to hear it. These four brands are going from strength to strength in the modern world, regardless of what old codgers like me think about the current 3-Series or the humpback GLE “coupe”.

The second tier consists of Acura, Infiniti, Cadillac, Genesis, Lincoln, Volvo, Jaguar, and Land Rover. Some of their products are excellent — I would have a Continental Black Label in a heartbeat if I could even remotely justify having a four-door sedan taking up driveway space — but the brands themselves are tarnished to varying degrees. Outside certain college towns, nobody thinks a Volvo is equal to a Mercedes-Benz. Outside Detroit, nobody thinks a Cadillac is equal to a BMW. You can lecture your friends and neighbors about how the Jaguar XE has more soul than a C-Class and a Continental has a better sound system than an LS460 but it doesn’t really matter. Branding, like cocaine, is a hell of a drug.

It wasn’t much different 40 years ago, but back then you didn’t have every automaker firing shotgun blasts of products at every potential minor niche. The Volvo 240 didn’t necessarily compete with the BMW 528i which didn’t necessarily compete with the Cadillac Fleetwood Brougham. Today, everybody fields a full line and offers no quarter. In 1982, the customer who couldn’t afford a dismal diesel W123 Benz was shown the door without ceremony; today they stuff that mook into a CLA lease before you can say, “It’s what-wheel-drive?” As we recently learned at the auto show, Lexus is no longer willing to lose seven-seater CUV business. If you have thirty grand in cash or the ability to make a $500/month payment, you can have a car from any of the four top brands, no problem.

Which puts the second-tier automakers in a bit of a quandary. They can’t sell on price, product, or position any more. There’s just one thing left to sell — the deal. The only way somebody’s going to select the second tier is if they think they’re getting away with something. This has been true in the clothing and timepiece business for quite some time now: who’s gonna buy a Ralph Lauren anything unless it’s on sale? You see anybody paying full whack for a Bell&Ross watch lately?

We’ve kinda-sorta seen this movie before: Lee Iacocca was the pusher-man who got the whole domestic industry hooked on rebates. But that was all relatively tame stuff. Five percent of sticker. Maybe 10 in dire straits. Employee Pricing For Everyone in an era where most vehicles don’t have 12 percent of gross margin. That’s not cutting the mustard for Volvo and Infiniti. Now we’re talking 20 percent. 30. They hide it in the fine print of lease deals and they have a half-dozen different names for the incentives, but in the final analysis Volvo understands that a Chinese S90 isn’t worth much more than the average retail price of a new automobile (which is to say $34,000). The true and actual price for a Chinese S90 — or a just-as-you’d-expect-Japanese Infiniti! — is one long Vegas weekend away from a Honda Accord Touring.

Oops. So much for “upscale.” Looks like a Coach purse isn’t worth much more than a Wal-Mart one.

But there’s no need to worry, because no matter how low these brands stoop, they’ll still have Buick to pick on.

Twelve grand off, or between seven and nine dollars a day, and who’s interested? Nobody? I want to put this in perspective. Today I went to Jimmy John’s and got a sub sandwich that tasted like ocean plastic, a small bag of chips, and a soda. It cost me $8.22. The American consumer, by and large, has decided that the value of a Jimmy John’s sub exceeds the value of a new Buick. Thirty years ago, bank presidents drove Electra “deuce-and-a-quarters” — but thanks to a generous helping of Far East sourcing and possibly the most fecklessly inept marketers on the planet Earth, the Tri-Shield products are now a no-sale, even at fast-food prices.

Mark my words, there is yet another ruthless consolidation coming for the present-day automakers. And this time it will target the slowest gazelles on the savannah, the near-luxury brands that need $15,000 discounts just to get people into a showroom. This isn’t necessarily a product problem. The current Infiniti sedan is very good. And you can have a brilliant product fall apart without branding:

Forty-eight grand on perhaps the most innovative and fascinating sporting car to appear in a decade. If you had a chance to drive an Acura NSX, you’d get out of the car a passionate evangelist for the thing. I’ve seen it happen a dozen times. But the branding and the market position don’t support it. It’s more than a shame — it’s a tragedy, because marketplace failures like this discourage the development of great new product. Every time an NSX fails, a sickeningly cynical compact luxury SUV product plan gets its wings.

What’s the fix? You might as well ask me, “So what is the color of the boathouse at Hereford?” I don’t pretend to have the answers. All I can tell you is how Lexus broke into that top tier. They sold a very good product with an outstanding customer experience at a low, low price, and they kept the price low for a long time, and they didn’t play too many games with incentives or discounts. That’s a tough road to take — but, like they say, it’s a long way to the top if you wanna rock-and-roll with the big boys.

[Image: Volvo Cars]

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232 Comments on “Guard Your Grille: It’s the End of the Road for Fake Luxury...”


  • avatar
    Robbie

    Isn’t the Chinese S90 simply the perfect vehicle for the Asian market? Car prices are much higher there, incomes lower… You cannot blame the Chinese for trying to also sell a couple in the US. Similarly, we try sell a few pickups in Japan.

    • 0 avatar
      SSJeep

      Ive been to Japan several times, and never seen a US based pickup in Japan. But I have seen a lot of Kei trucks. The few American made cars you will see in Japan are Jeep Wranglers and the occasional Grand Cherokee.

  • avatar
    Arthur Dailey

    “So what is the color of the boathouse at Hereford?” Jean Reno demonstrating that he could out act De Niro in his sleep? However as usual in an American movie the wonderful Sean Bean was badly miscast. Watch ‘Broken’ to see what he can do as an actor. Or the Sharpe series to see why he is an icon in England.

    As for the hypothesis, I agree. At least under current socio-economic conditions. Growing up, when there was greater social mobility and less economic disparity in North America, it was extremely rare to see ‘luxury’ cars.

    A famous Dave Berg, Mad Magazine panel has Roger Kaputnick introducing one friend to another. Prior to doing so he bets the first friend how long it will take the second to mention his ownership of a Cadillac. Owning one, demonstrated that you had ‘made it’.

    Now I tend to see an exotic or supercar on a daily basis.

    Not to worry. Self driving, non petroleum byproduct transportation will become the norm. Quite probably before even I am no longer around.

    • 0 avatar
      GermanReliabilityMyth

      What, me worry?

    • 0 avatar
      Whatnext

      One does not simply walk up to the gates of your Volvo dealership and ask for a Chinese assembly discount!

    • 0 avatar
      krhodes1

      I think how many luxury cars one saw depends very much on where you grew up. Kids in my (public) high school drove their Dad’s Ferrari to school. But yes, across the board cars are cheaper than ever. I don’t find this to be a bad thing.

      I really don’t know what Jack is on about. He keeps going on and on and on about how the Chinese S90 is some sort of terrible, lesser thing while giving no evidence what-so-ever as to why that is so other than the mere fact that it is Chinese built. I guess in that case an iPhone X must be abject crap? Volvo has never, ever, ever, ever been anywhere near the top tier in product or price. NEVER. And I say that having owned 13 of their cars. Because I couldn’t afford the good stuff, I bought the “good enough”.

      Also very much disagree about Land Rover being second tier. MAYBE the Disco Sport and associated platform “cheap” Range Rovers, but the big ones are the real deal.

      • 0 avatar
        Arthur Dailey

        My youngest brother attended high school at what is generally conceded to be the most affluent public high school in Toronto during the late 70’s and never saw a Ferrari (or similar) in the parking lot.

        Now in the parking lot of the local university we see Lambos, Ferraris, Audi R8’s and even a McLaren. Range Rovers are common, as are 7 Series BMW’s

        Back in the mid to late 70’s it was not uncommon for major league professional athletes to drive Monte Carlos, T-Birds and even sponsor supplied Hondas.

        University professors drove clapped out Volvos, and VW’s. Although I knew one who had a Checker.

        Conspicuous over consumption was still somewhat frowned on. One associate owned a Porsche but would never drive it to work for fear of offending his employees.

        • 0 avatar
          HotPotato

          Ironically given this piece’s take on Chinese assembly, the supercars in that college parking lot very likely belong to Chinese exchange students. Said students may well have paid someone else to write their entrance essays, and possibly continue paying others to write their papers as well. What’s important to the school is that they pay full-boat unsubsidized out-of-state tuition, and what’s important to Daddy back home is that Sonny get a brand-name Western diploma to help lend credibility to the family’s various international enterprises for laundering the fruits of corruption. That obviously doesn’t describe the majority of Chinese exchange students, but it does describe a conspicuous subset. Remember the stereotype of “the ugly American” — flashing his newfound postwar wealth and naive cultural arrogance around the world? That role now belongs to a generation of young Chinese.

    • 0 avatar
      rcx141

      I like how nobody was brave enough to tell De Niro he was pronouncing He-re-ford wrong !

  • avatar
    ajla

    I think you’re a little hard on JLR. They are more like 1b level.

    And what tier are Alfa and Maserati?

    • 0 avatar
      TMA1

      Alfa and Maserati are on their own tier, i.e., the forgotten one. That’s why they weren’t mentioned.

      It can be rebranded as a secret tier, and thus be a feature worth paying for.

    • 0 avatar
      bd2

      Baruth overrates Lexus (and even Audi) and underrates Cadillac and JLR.

      As much grief that Cadillac gets on TTAC, Cadillac sells WAY more luxury sedans in the $45k+ starting price-range than either Lexus or Audi.

      Aside from MB and BMW, they should be in the 1.5 tier (or lower).

      • 0 avatar
        SSJeep

        If one of the leading indicators of luxury is quality (e.g. the car needs to start every morning for more than 6 months), Jaguar, Land Rover, Maserati, Alfa are all relegated to the bargain bin.

        Cadillac and Audi are on the edge due to parts bin sharing between other GM/VAG products and their luxury marques. Lexus would have been here years ago as well, now the closest badge engineering they have is the ES350 (which is about as much a Lexus as a GLA is a Benz).

        • 0 avatar
          bd2

          Depends on what one means by “quality.”

          There is quality in terms of reliability and functionality; and then there is quality in terms of quality of materials and fit and finish.

          • 0 avatar
            ToddAtlasF1

            “Depends on what one means by “quality.”

            There is quality in terms of reliability and functionality; and then there is quality in terms of quality of materials and fit and finish.”

            In which case Lexus and Land Cruiser tower above all others.

        • 0 avatar
          JohnTaurus

          “now the closest badge engineering they have is the ES350 ”

          You mean the LX isn’t a Land Cruiser with a maw? The GX?

      • 0 avatar
        RHD

        What percentage of 20 year old Lexus vehicles are still on the road today, and what percentage of Cadillacs?
        How many Cadillacs will make it to 200K miles, vs. Lexus?

        Quality is an inherent trait of luxury, not numbers sold.
        If that were true, a Quarter Pounder would be luxurious.

        • 0 avatar
          bd2

          At the same time, reliability also isn’t a hallmark of “luxury” much less uber-luxury (see Rolls Royce, much less the exotics/super-hypercars).

          One hallmark of luxury is offering customization (something that the Germans offer way more than Lexus) and offering the “best/most” – such as in powertrains (where Lexus has seriously lagged behind aside from reliability).

          • 0 avatar
            ToddAtlasF1

            If you think some eastern-European built heat pump is better than a naturally aspirated Lexus V8 then you’re a marketer’s dream.

    • 0 avatar
      jfk-usaf

      Chrysler product. No longer upscale just expensive.

  • avatar
    PrincipalDan

    When you can option a Hyundai up to heated BACK seat, what’s the freaking point of luxury brands anyway?

    When you can get a Denali Terrain (with the saddest little lowest hp FWD powertrain) what’s the freaking point of luxury brands? (Either real or fake.)

    • 0 avatar
      ajla

      “what’s the freaking point of luxury brands anyway?”

      Engine power and extra cylinders in not a truck.

      • 0 avatar
        PrincipalDan

        Meh If you want more than about 5 liters (at a price mere mortals can afford) you are looking at a truck anyway.

      • 0 avatar
        bd2

        Must explain all those 4-banger BMWs, MBs and Audis.

        • 0 avatar
          ajla

          But they make non 4-cylinder things too.

          Right now the only non-premium branded car offerings with a V8 I can think of are the Mopar triplets and the Mustang/Challenger.

          If you just want a RWD-based car with a back seat and over 300hp you can add the Stinger to the above list.

          I wish it was different but currently if you want a new vehicle capable of carrying people and equipped with a cosmic-power many-cylinder engine your only options are trucks/SUVs, Mopars, and premium brands.

    • 0 avatar
      jkross22

      Dan, This may be how many of us here think, but the reality is that many buyers/leasees are badge/brand slaves. To Jack’s point, how many CLA, 320i, IS200t and A3/4 buyers cross shopped something from tier 2? I’d bet not many.

      If they did, they’d see the cynicism from the manufacturer of those tier 1 cars. Those cars are priced so far beyond the competitive value they bring that anyone with any level of objectivity could see it. Or maybe not.

      Branding is a drug and it numbs common sense.

      • 0 avatar
        legacygt

        Forget about Tier 2. Who would buy a CLA after an honest comparison with a Honda Civic or Mazda3?

        • 0 avatar
          Jack Denver

          Who? Someone who values a Mercedes logo the size of a dinner plate on their grille more than they value any other attribute. A Civic might be (in fact is) a much better car but it’s not a “Mercedes”. Even if you called the Civic an “Acura” it would STILL not have the cachet of that Mercedes badge. People are willing to pay real money for branding.

          The joke is that when Mercedes owned Chrysler, they were reluctant to share any of their technology (except outdated stuff) with them because they didn’t want to “degrade their brand” but they are willing to degrade their OWN brand with junk like the CLA which is far more damaging than a Chrysler with “Mercedes guts”. At some point won’t this upset customers for real Mercedes vehicles?

          • 0 avatar
            TMA1

            I think the presumption is that those CLA buyers will come back for a real Mercedes (C-Class or better) next time, or go away.

          • 0 avatar
            baconator

            Everyone I’ve chatted up re: this already knows that there are “real Mercedes” and “kid Mercedes.” The CLAs/SLKs are for the gold diggers and the kids. Every other model is $100-300/month more than the allegedly comparable BMW, and totally worth it.

            The dealers near me are selling every single AMG 43 and 63 within days of getting it off the truck. They’re willing to deal, like, maybe $3k off a $120k sticker.

            (I say this as a guy who drives a raggedy old S-Class and spends a fair bit of time at the dealer sitting in new cars and wondering if I want another lease payment. The answer keeps being no, because my S-class keeps running just fine and making me happy every time I drive it.)

          • 0 avatar
            bd2

            Eh, the CLA is hardly the worst of it from MB.

            You think the Sprinter and Metris commercial vans evoke “luxury”?

            And the interiors of the C Class (until the current gen) and esp. of the GLK were hardly luxury (the worst offender probably being the interior of the 1st gen BMW X3).

            MB has a varying brand image – depending on the market.

            For instance, in Europe, MB is seen more as a full-line manufacturer, including heavy trucks and econo-boxes like the A and B Classes.

      • 0 avatar
        CincyDavid

        When I worked in a luxury bodyshop, we HATED dealing with A4, 3 series, C-Class owners (lessees) because they were frequently tough to deal with: couldn’t afford to really maintain the car, rolling around on smooth back tires that probably contributed to the collision, had trouble coming up with the deductible or paying for the rental. A lot of these folks should have been driving a Corolla, but had delusions of grandeur.

      • 0 avatar

        Don’t forget the perception of exclusivity. The perception that nearly anyone could afford a Cadillac, arguably, hurt the brand as much as Cimarron did.

        • 0 avatar
          FreedMike

          If the “non-affordable” Caddies had been truly desirable, and truly prestigious, Cimmaron wouldn’t have been a disaster for the brand at all – it’d have been a junior membership to the club, if you will.

          Problem was, EVERYTHING Cadillac made at that point was basically as junky as a Cimarron.

          Luxury brands can get away with selling cynical “entry level” cars like the Cimarron – or the CLA – as long as the rest of the brand retains its’ core virtues and prestige.

          The problem comes when the top of the line stuff gets cheaped out.

        • 0 avatar
          TMA1

          This is why all luxury cars should be designed to rust into piles of red dust within 3 years. Then the ‘hood wouldn’t be full of 3rd/4th-owner luxury vehicles making the brand look bad.

          The real money can afford to buy a new one every three years.

          • 0 avatar
            HotPotato

            “The real money can afford to buy a new one every three years.”

            But the real money does not, and it’s a point of pride. They drive a Mercedes-Benz S-class from the 1990s or a 380 SL from the 1980s. Then again, I live where rust doesn’t, so rich people have the luxury of conspicuous non-consumption.

          • 0 avatar
            ToddAtlasF1

            I think you’re confusing old money with real money. Plenty of real money never had a chance to buy a West German car new and watch it age gracefully. They only know disposable, China-targeted, tacky gin palaces as luxury. The lease is their commitment to being worthy of something relevant in two years time. Telling them to look at something of quality is like telling them that their gravy train is going to dry up. Besides, when tough times do come, it will make them easier to clean up after if nothing they cherished endures.

      • 0 avatar
        Snooder

        I bought an 2.0T ATS after cross shopping with an ecoboost stang and a bmw 228i.

        The stang didn’t feel nice enough, and the beemer was too expensive.

    • 0 avatar
      Garrett

      Every time I’ve been in a rental Hyundai, I’ve hated it.

      For most people, Hyundais are fine, but I would say that Hondas are still noticeably better built, and the European cars offer a better driving feel.

      I would choose a Hyundai over a Toyota Camry though. What a miserable car that is.

    • 0 avatar
      stuki

      “…what’s the freaking point of luxury brands anyway?”

      The Luxury brands….

  • avatar
    dividebytube

    Meh – I would take a Jaguar XE (and especially the XF) over a BMW. Because it takes a certain kind of lunatic rich man to deal with a British car on a daily basis.

    My anglophile bias showing, but my eye is drawn to a Jag (and the new Volvo X90) a lot quicker than a BMW, Mercedes (except for the G-Wagon), or Audi since the latter are so common.

    • 0 avatar
      dal20402

      I took my old Acura Legend (incidentally, a car which was able to look the E34 square in the eye when new) to the shop this morning to have a failing transmission speed sensor replaced. In front of the usually Japanese-brand-focused shop was an X308 XJ8. I asked the service writer “Are you guys working on that Jag?” She got a look of horror on her face, and said “Yes. We’re giving it a 90,000 mile service. DON’T EVER BUY ONE.”

    • 0 avatar
      bd2

      Right now, the Jags are the superior handling machines, but their interiors are subpar (both in space and in quality of materials).

      Like Cadillac, Jaguar focused on the wrong things for the American market.

  • avatar
    George B

    Great article Jack, but I disagree on one point. The Range Rover is clearly a first tier luxury vehicle in terms of impressing other people when the valet brings you your car at the restaurant or club.

    • 0 avatar
      Dingleberrypiez_Returns

      Only if it’s a Range Rover (not a sport, not an evoque, not whatever else), and only if it’s brand new.

    • 0 avatar
      Jack Baruth

      It *was*.

      My father’s P38 Range Rover sent a pretty strong statement in ’99.

      Nowadays they have five things that all look alike. And they all sell on the deal.

      • 0 avatar
        Astigmatism

        The strongest statement those old Range Rovers made was that the Brits cared more about midday pints than they did about QAQC. I’ve told this story before so I’ll just leave a link to it here: https://www.thetruthaboutcars.com/2013/03/dougs-review-1995-range-rover-classic/#comment-2026178 . A friend had the P38 and his experience wasn’t all that different. And it looked like an MCW Metrocab.

      • 0 avatar
        dal20402

        I disagree, at least for the West Coast. The full-size Range Rover, today, is the strongest statement you can make at the valet stand short of an exotic brand. People pay more attention to it than they do to a S-Class or GLS, and it’s not close. The other LR offerings are every bit prestige-competitive with the Benz or Audi choices in the same segments.

        Jaguar is on the bubble, but Land Rover is squarely in the top tier.

        • 0 avatar
          FreedMike

          Jaguar needs to step up its’ quality game if it wants to make the top tier again. I checked out a XF a few months ago and at its’ price point, it’s iffy at best. And the interiors are drab.

          • 0 avatar
            ajla

            The interiors on new Jaguars make me so sad.

          • 0 avatar
            bd2

            Like Cadillac, Jaguar spent their $$ on a light-weight platform.

            But even the Jag portion of JLR is seen as more “prestigious” than the offerings from Lexus (just more problematic).

      • 0 avatar
        baggins

        Have you seen the discounts on MBZ sedans lately.

        BMW, MBZ, Audi and Lexus all sell on the deal as well

        • 0 avatar
          kurkosdr

          Which makes me wonder: Is what customers perceive as “luxury” changing from luxury materials glued on the interior to advanced technology? To make it more clear: Does Tesla have to offer discounts to people lining up to by their crap-interior cars? Answer: No

          Wouldn’t be surprised if the Tesla Model S does to MBZ, Audi and BMW what the Apple iPhone did to Vertu (a company sticking diamonds and expensive metals to technologically mediocre phones) and to Motorola (the company with the gold-plated RAZR).

          • 0 avatar
            stuki

            “Does Tesla have to offer discounts to people lining up to by their crap-interior cars? Answer: No”

            At least partially because Daddy offers the discounts for them. There is a pretty strong correlation between “incentives” offered to drive a Tesla vs an S-Class in a given market, and the Tesla’s market share vs the Benz. IOW, it’s buyers get to feel like they’re getting “the best of it.”

            Norway is, I believe, the market with the highest Tesla market share. And is a country where every other similarly priced and positioned car is taxed 300%. While Tesla drivers get taxed nothing, get free charging, free parking, and are allowed to drive in bus lanes, speed through school zones, run red lights, run over politically incorrect V8 owners and, horror above all horrors, text while driving…. While the rest pays full whack, only to have their 3x the price 4 cylinder Benz towed for being parked a fractional inch outside it’s designated parking spot. The last few remaining of which are located half a mile of free battery charger spots away from anywhere useful.

            While in politically, demographically and socioeconomically (and even genetically) remarkably similar Sweden, where the incentive differences aren’t quite that ridiculous; due to Sweden at having a history of automaking (you can only run over V8 owners if they are not immigrants, for one…), Tesla’s share vs similar bracket ICE cars, is far less outsized. While in that other Scandinavian country, Minnesota, people just pay luxury car prices for trucks with big V8 and custom 70s style paint jobs..

  • avatar
    hreardon

    Great article, Jack.

    I’ll also +1 the Range Rover as being a Tier 1 lux brand, at least in the Northeast suburbs of Cleveland where the wealthy soccer moms of Shaker Heights and the Chagrin Valley are concerned.

  • avatar
    ajla

    “Thirty years ago, bank presidents drove Electra ‘deuce-and-a-quarters’ ”

    You probably need to change that to “forty years ago”. Or maybe even “fifty years ago”.

    Thirty years ago the FWD C-body was carrying the Electra name. Although I personally like the American FWD stuff from the late 80s I have a feeling most bank managers were buying German by then.

  • avatar
    legacygt

    An interesting point. The car buying public puts greater value on a pretty bad Mercedes (CLA) or an average Lexus (ES, RX) or a decent BMW (X1) than some very good or even great cars from these other manufacturers. The question will be whether this can hold up over time. How long can you put customers in a CLA (a car that doesn’t really compare favorably vs. a Honda Civic or Mazda3) and still maintain premium cachet across the brand? So far, there have been no ill-effects but this may change.

    Still I have different feelings about each of the brands you mention:

    Acura, Infiniti, Lincoln: These three can disappear from the face of the earth with little real impact. There isn’t too much different or exciting coming out of any of these brands and I’d add Buick to the mix. The NSX may be an exception and I question it’s inclusion in the discounting analysis here because it’s not really a volume seller.

    Cadillac almost recovered and it offers a couple exceptional vehicles. They’ve had a few missteps and they make the most money on a car (Escalade) that really isn’t all that special given the GMC and Chevy counterparts. Still, the world would be a somewhat lesser place if Cadillac disappeared.

    Genesis doesn’t belong here. The article explained how long it took Lexus to achieve luxury status. Genesis is still just starting out. Solid cars and an innovative home delivery/concierge model may pan out. (Although somehow luxury customers seem to enjoy their time with car salesmen.)

    Volvo kind of decided it was a luxury brand without informing the public. There is some recognition that the brand will cost a premium but not enough. Their biggest mistake (other than letting the product wither for a decade or more) was abandoning the middle market. They used to charge a slight premium hinging on reputations for utility and safety but they abandoned that market and Subaru (quite successfully) filled the void. While Volvos are much better than a decade ago, having Volvo disappear from the luxury market would be a non-event. However, Vovlo’s disappearance from the practical/tweedy/safety-first/utility/slightly-premium space a couple decades ago is still a loss.

    Jaguar, Land Rover: While smaller than the big names, these guys belong among the luxury brands. You don’t have to make any excuses at the country club when you pull up in either of these. The cars may be hit or miss but luxury cred is there.

    • 0 avatar
      dal20402

      To go anywhere, Genesis will need to get to a place where their products are like the early Lexuses (ES 250 excepted): absolutely the best on the market for a certain customer, irrespective of price. They’re not there yet. An image of “good enough but a good value,” which is where they are now, isn’t ever going to get them to top-tier status.

      • 0 avatar
        bd2

        Eh, have you seen IS, GS and LS sales nos?

        Lexus’ past doesn’t seem to be doing Lexus RWD sedan sales any favors.

        Arguably, the Genesis brand is already seen being above brands like Acura and Lincoln (by enthusiasts and the automotive press) based on the RWD/FWD divide.

        In time, due to Lexus’ ever increasing reliance on FWD-based models for sales, can see the Genesis brand catching up to Lexus.

        • 0 avatar
          dal20402

          No one knows what a Genesis is except people who read car mags.

          Everyone, and I mean everyone, knows what that L in a circle stands for.

          And fortunately for Lexus, sedans aren’t where it’s at. They’ve got the best-selling luxury CUV in the RX, literally the only small luxury CUV that’s actually comfortable in the NX, two of the most prestigious SUVs in the LX and GX, and two more big CUVs on the way (RX L and the rumored seven-seater).

          Genesis made a huge mistake getting three sedans ready before even a single CUV or SUV. It should have been the other way around.

          • 0 avatar
            bd2

            Well, a Harris Poll 2017 EquiTrend Study says different.

            According to the study, millenials ranked Genesis 3rd among luxury brands (after MB and BMW) and ahead of Lexus which placed 4th.

            And sorry, despite the movement to crossovers, the prestige is still in flagship sedans and that’s where MB is still “king” by a long stretch.

            And on the smaller end, the 3/4 Series and C Class are still the best sellers for BMW and MB, respectively.

            Yeah, the RX and NX sell well for Lexus, but that’s b/c they are cheaper than the RWD competition.

            There’s a reason why most auto rags in comparison tests pit the RX against the X3 and GLC (and not the X5 and GLE) and the NX against the X1 and GLA.

            And what does it say when Lexus’ only volume selling sedan, the ES, has the Buick LaCrosse as its main competitor?

            As for the NX, it has gotten dinged for its ride (not surprising considering its RAV-4 roots) and the for “prestigious” SUVs, the LX and esp. the GX don’t sell well compared to the competition.

            The GX might hit the 6k for the year.

            Cadillac will sell around 15k of the Escalade ESV.

            And that’s not counting all the sales of the Yukon XL Denali.

            As for the Genesis brand, it’s traditional for auto-makers to develop a sedan first and following with other body-styles.

            The “mistake” Genesis may be making is going with more expensive RWD-based crossovers than the cheaper FWD-based crossovers favored by Lexus, Acura, Lincoln, Volvo and Cadillac.

            Doing so, will put them at a price disadvantage, but the potential upside in doing so is being able to offer models which adhere to the traditional values of what luxury vehicles offer.

          • 0 avatar
            bd2

            Granted, there is less stigma when it comes to being FWD-based with CUVs as most CUVs have available AWD.

            But at the same time, not everyone needs or wants AWD (even for a CUV); in particular, those living in the sun belt (why lug all that extra weight around?).

            And RWD has its inherent advantages – mainly the being able to offer more power and in driving/handling characteristics.

            While Lexus offers the RX F-Sport which is basically little more than a cosmetic package, with the upcoming GV80, Genesis will be able to offer the power of a V8 and down the road, a real performance variant.

  • avatar
    CincyDavid

    Given that it’s Christmas time and my college aged kids are brand whores, this is an interesting topic. I have tried to explain that a MK watch is just a cheap Asian watch with MK-style bling hanging on it and that VineYard Vines shirts aren’t worth $98, but they just haven’t made the connection between value and price.

    I fully expect near-luxury automotive brands to get squeezed to the margins, and perhaps killed altogether. It’s a natural evolution of the auto market, and Ford and GM may blame themselves for introducing the LTD and Caprice in the 60s, squeezing their own in-house brands out of existence.

    • 0 avatar

      Unless Cadillac can move further upscale, back toward where it was in the 1950’s, leaving Buick room to maneuver, they and GMC are basically upscale Chevies. So save the development and marketing money and just sell Bowtie those rides.

      I go back further than 1965, to the ’55 BelAir and especially ’58 T-Bird. THAT’s the one that legitimized King Ranch F-150s.

    • 0 avatar
      bd2

      While there are a growing # of people leaving “tier 1.5 or tier 2” luxury brands, there are also a growing # leaving tier 1 luxury brands as many buyers want more space and all the latest tech.

      So if that means purchasing a Buick Enclave (Avenir trim) or something larger like the GMC Yukon XL Denali than say, a MB GLE or GLS – in order to get the space/amenities that they want, then that’s what they are going to do.

      There’s a reason why Denali sales keep on growing for GM and why they launched the Avenir sub-brand/trim.

      As for Cadillac, JdN’s dream of a primarily RWD-based line-up has been dashed.

      Going forward, Cadillac’s sedans will remain RWD (with the lone exception being the XTS until its run is over; still a ? about the new small sedan that will compete against the A3. CLA, etc.), but the bulk of its CUV lineup will share platforms with Buick, etc.

      The XT5 is Cadillac’s best seller and hasn’t hurt Lexus or Acura when it has come to their CUV sales (as they offer lower prices, more space and amenities compared to the RWD CUV offerings from BMW and MB).

    • 0 avatar
      SSJeep

      CincyDavid – I couldnt agree more. It seems that most kids (and adults) have trouble understanding that the same factories that make the $10.00 WalMart watches also make the MK (and other) “Luxury” watches – both of which are made in China with very similar quartz movements. Same with T-Shirts – take a $7.00 cotton shirt, slap on the new Ed Hardy nonsense, charge 90.00, rinse, repeat.

      Yes, some of the near-luxe brands will either consolidate or fail. It is the natural order of things. And these brands now have Tesla gunning for their dollar and largely succeeding in pulling some sales out of the luxury petrol market.

  • avatar
    Land Ark

    I’ve previously mentioned it, but I took over someone else’s lease on a 2016 Buick Regal GS. It’s the base version of the GS which means I am missing nearly all of the driving aids but not much else.

    I had been pondering picking up a used one for some time, I guess as much as I ponder picking up any one of three dozen cars at any given time. But I had never driven one or been inside one. And maybe it’s because my newest car otherwise is a 2007 Legacy, but my goodness is the Buick a fantastic car. I’m not sure what I’m missing by not having a BMW or Lexus. It’s miles ahead of my dad’s ’10 335xi and I had been shopping an IS350 pretty hard for some time and other than being wrong-wheel-drive I can’t justify spending more for the IS.

    The only thing I am left wanting for is speed. It is swift, but not at all as fast as I had been lead to believe. The guy I took the lease over from seemed to think it was supercar. But I guess my expectations are too high since my Subaru will pin you hard into the seat when the turbo spools up and one knows better than to give an LS2 full throttle in anything other than optimal conditions. A normal person would find the GS thrilling.

    I’d never say I couldn’t tell the difference between it and a Lexus LS or the like, but for the market position I would not be able to steer someone into a more expensive car regardless of the badge or because of the discounts available.

    Will I be buying it at the end of the lease in mid-2019?
    No.
    Maybe I’ll look at the new Regal wagon then.

    • 0 avatar
      DeadWeight

      The Regal is a well driving car, with true Teutonic ride quality, quietness, solidity and such, because it’s an Opel design, essentially a modern Cadillac Catera (which was unfairly maligned, and was great riding, quite and solid, also, contrary to many claims of its rubbish-ness; I had a company-provided 2001 Catera up to 130 mph in remote parts in the west and it was a solid, quite and planted as any BMW or MB, and more so than the smaller Audis).

      Where things fall apart for the Regal, as they did for the Catera, will be reliability issues and astronomical maintenance and replacement part costs (think BMW-level maintenance and repair costs – especially terrifying post-warranty – as the Regal is essentially a German vehicle.

      • 0 avatar
        DeadWeight

        p.s. – The Catera was built in Rüsselsheim, with REAL German autoworkers, using mostly German/Austrian/Belgium and other European parts (though the motor was a 3.0 liter British fabricated unit).

      • 0 avatar
        ajla

        The problem with the Catera wasn’t that it was bad to drive. The issue was that the exterior styling was dull, the marketing was stupid, and the reliability of the Ellesmere V6 + 4L30E combo was from Satan’s butthole (even more so than a Northstar).

        I’d also argue that the Lincoln LS that came out around the same time was superior (and offered a V8). However, the Lincoln was also a reliability bomb and I haven’t driven an example of either in over 9 years so YMMV.

        • 0 avatar
          FreedMike

          Yep, and if you want to destroy a brand’s prestige, there’s no better way to do it than to sell junk.

          But Caddy and Lincoln did it one better – not only was the entry level stuff junk, the expensive stuff wasn’t all that much better. People will excuse a luxury brand selling crappy entry level cars if the upper level stuff is truly top shelf.

          That’s how Mercedes gets away with selling the CLA (which may or may not be junk, but sure as hell isn’t luxurious).

          But if it’s all crap, then the brand is too.

        • 0 avatar
          28-Cars-Later

          LS was a nice drive, but it was essentially an S-type, drivetrain and all. Oddly, the actual S-type seemed to have a longer lifespan.

      • 0 avatar
        05lgt

        sure, but can you help me time a tourx purchase just right to get the maximum discount before they go away?

  • avatar
    Lou_BC

    “It’s the End of the Road for Fake Luxury”

    This is because we are in the twilight year(s) of the US empire. The gap between “haves and have nots” have grown so much that there is no market for “middle-classed” luxury. Anyone who can afford “middle-classed” luxury are buying Denali Yukon’s or Denali Sierra’s.

    • 0 avatar
      JMII

      I think this is a big part of it. As the middle class shrinks that middle or 2nd tier line of vehicles serves little purpose.

      I do believe the manufactures also brought this on themselves as well. What is the difference between an Acura and a Honda? RWD? No. Leather seats? No. Touchscreen navigation? No. The only difference is the logo and the “fake luxury” spewing from the marketing folks. End result – no sale, or discount luxury. But is that even a thing? I think it can be.

      However I use this current situation to my advantage… my wife got an Infiniti Q60 for nearly 1/2 off its list price because on the used market fake luxury = no luxury at all.

      • 0 avatar
        bd2

        Once can say the same thing about the best sellers for Lexus.

        The NX, RX and ES with a smaller CH-R CUV supposedly in development.

        Also, you should check out the resale on “real luxury” BMWs and MBs that are out of warranty.

        Heck, the biggest losers are the S Class and 7 Series.

    • 0 avatar
      derekson

      It’s a combination of this and looser credit. With 0% financing, why not take on a bigger loan and get the REAL luxury marque?

    • 0 avatar
      28-Cars-Later

      This, among other things.

    • 0 avatar
      baconator

      Yup, this.

    • 0 avatar
      SSJeep

      I wholeheartedly agree with Jack on this entire article, and I think this change has been coming for some time. Just look at how the watch world has fragmented over the past 4 years, and how many crappy “German-made” Chinese movement watches infiltrate your social media feed. Can they all survive? Absolutely not. And I suspect that the lower tier pseudo-lux brands will fall with them (Tag Heuer, Oris, etc).

      When it comes to cars, the word luxury is thrown up just as often, and very few of the models presented as luxury can really compete. Does anyone really think the Infiniti of today is a luxury brand? The interiors stink of 2008 and CVTs should be relegated to the bargain bin. Luxury, they are not, near-lux would be the best descriptor.

      The middle class in the US hasn’t entirely shrunk, but it has certainly changed, and it has done so even in your Canadian homeland Lou_BC. The middle class today is largely made of tech workers, management, financial services, government employment, etc. And these people buy an awful lot of cars, making the US #2 in new car sales, second only to China (which has a much larger gap between the rich and poor)…

      By the way, have you priced out a Yukon Denali lately? Sticker prices clock in around $80k!

      • 0 avatar
        Lou_BC

        @SSJeep – Skilled tradesmen like welders, pipefitters, electricians etc. also fall into that middle class. What has changed is where “unskilled” labour falls. Many are now at the low end of the middle-class or fall into the under-class. Canadian Colleges and Universities are not predatory like many in the USA so education is more attainable.

        A loaded up Yukon Denali XL in Canada is around 100k. A Denali Sierra 4×4 crew is in the 80’s.

        • 0 avatar
          SSJeep

          Im certainly not going to argue about American university predatory tactics, because you are absolutely correct. The degree process and cost in the USA is completely ridiculous.

          $100k CDN for a Yukon Denali? Ouch! And I wouldn’t consider that to be a luxury vehicle either, on account of the swaths of cheap plastic…

        • 0 avatar
          bd2

          While American universities (and parents of applicants) have fallen for the “higher tuition = more prestige/higher worth”, the majority of students get some sort of aid at the top universities where the actual cost of tuition is HALF (and at schools like Harvard, families below a certain income level don’t pay any tuition at all).

          The whole student debt trap goes back to when Sallie Mae was turned into a private, for-profit entity at the insistence (surprise of the Republicans) in exchange for Democratic initiative to take out the middle man in the student loan process.

          Needless to say, with all the incentives Sallie Mae was offering universities to steer their students/applicants their way, the lower cost govt. program fell by the wayside.

          Since then, Sallie Mae has changed its name to the Navient Corporation where its former CEO was wealthy enough to build his own PRIVATE golf course in Maryland.

          What’s worse than the cost of tuition at these private universities (and increasingly public, as state funding has been cut and cut again), is the cost of tuition at the so-called for-profit online universities such a the “University” of Phoenix and the like which are little better than diploma mills.

          They charge as much for tuition as many private universities for degrees that are pretty worthless and greatest source of student loan defaulters have been students at these for-profit online “universities.”

          And guess who did everything in their power to protect them?

  • avatar
    Demon_Something

    I think another facet to the primacy of marketing is that the highbrow sorts, the kind that used to buy these cars with a ton of research and knew what good driving dynamics and build quality were, don’t focus on these kinds of purchases anymore.

    Nowadays, it’s all about signalling your lack of consumption, the big house you don’t have, the massive closet you don’t have. Cars are seen as the ultimate waste now for these people.

    The 20th Century was all about trying to accumulate wealth, as new consumer goods were invented. The 21st seems to be more about simply having money. That can be signalled much more discreetly with things like post codes, or extravagantly through international travel the average American can’t find time to do, much less afford. It’s all about the intangibles, and cars are definitely tangible.

    Without these people, the ones consuming traditional luxury goods are the middle-brow with cash. Tacky people, as was already stated. Since the usual taste setters don’t look for new, innovative cars, car makers just let the bean counters and the more craven marketing impulses run wild for the classically bourgeois.

  • avatar
    DeadWeight

    I’ve been really poking Jack lately, but he finally did something resembling (at least) a rough facsimile of the Jack of old, and turned in a solid B grade essay on a very real issue facing the auto industry today (which requires some genuine effort, accurate perception and a bold voice).

    And he’s pretty much spot on in his analysis.

    One quibble, however: Quit eating Jimmy John’s garbage (I will also mention that Jimmy, like Don Jr., takes pleasure in faux-hunting large trophy animals such as Rhinos and Elephants, thus being smuggled near-to their large prey, pointing a large caliber rifle at their ginormous heads, and shooting them, rendering them dead, for FUN – an activity that Jack and his little brother will likely fervently defend and even advocate) and go for the Italian at Potbelly, if you feel compelled to highly processed, carcinogenic deli meats (clean, unprocessed or minimally processed meat, from healthy animals with healthy diets, on the other hand, is nit only fine, but can be part of a on extremely healthy diet).

    Also, I kind of have a soft spot for SOME Range Rovers, and I literally can’t wait for NormSVtrifectaTuneArea51’s response regarding Chinuick (especially the clown and blue hair special Encore), that can be tuned to 385hp/420LBS FT OF TORQUE AT THE FRONT WHEELS WHILE DOING A 1/4 MILE IN UNDER 10 SECONDS WHILE GETTING 56.7 MPG.

    • 0 avatar
      Jack Baruth

      I go to Potbelly more often than JJs.

      But the line there is much longer, for obvious reasons.

      I’m pro-hunting in most cases. We shouldn’t have hunted the passenger pigeon to extinction but most modern hunting is either absolutely necessary (where would we be without deer season in the USA?) or actively beneficial for wildlife (guys like the Jimmy John’s dude provide active incentives for the locals to manage the herd instead of grinding them up for Chinese penis powder.)

      • 0 avatar
        DeadWeight

        If Jimmy is really focused on genuine conservation efforts to stave off extinction and endangered status, I consider that as a mitigating factor for what I still deem as ruthless and unsportsmanlike killing of Big Trophy Animals.

        Can’t he do the support thing without the shooting squarely in the head thing, though? If the premise is that only by penning/fencing in wild game, and charging “hunters” big money to kill a set number of glorious, endangered animals, can conservation and anti-poaching efforts be efficacious, I don’t you understand, and can provide better alternatives (I’m insinuating that the conservation talk is cover for some pretty unsporting and depraved kill-lust).

        Also, I’d be remiss to not take the opp to re’state the following (since Volvo has come up here):

        What a clean, beautiful, proper car, that’s so much better than 98% of the overwrought crap designs in modern cars.

        1966 Volvo P1800S is spectacular:

        http://volvo1800pictures.com/0_car_photos/S/1966/noc/3257/Volvo_1800S_66_noc_3257_10.jpg

        Whoever designed that deserves the Nobel Prize Forever for design.

        • 0 avatar
          Jack Baruth

          The problem in a nutshell is this:

          The African big game is surrounded by ever-encroaching communities of people who live on the equivalent of fifty dollars a year. If you don’t pay them to look after the animals, they will harvest them and sell the furs/tusks/testicles to China.

          You have to come up with a way for the animals to be worth more dead than alive.

          The easiest free-market way to do that is to charge Mr. Jimmy John’s $50,000 to shoot an elephant. There isn’t $50,000 worth of Chinese penis powder in an elephant. So the elephant is worth more alive than dead, and the surrounding communities have an incentive to prevent poaching and/or harvesting.

          I haven’t shot an animal in twenty years. I’m not a hunter. But I recognize the critical role of hunting in preservation.

          • 0 avatar
            DeadWeight

            I do hunt – deer, ducks, pheasant.

            Deer, especially, need to be hunted in places such as Michigan, lest they starve and/or become a major source of vehicle-animal collisions (often leading to serious injuries or fatalities).

            Rhinos, elephants, tigers, lions etc do NOT need to be penned and shot like fish in a barrel on “hunting” reserves on continental Africa for preservation/conservation purposes.

            Apples & oranges.

          • 0 avatar
            brenschluss

            I believe the point was that the alternative to high-fence hunting operations is uncontrolled poaching; the former is at least some type of control that prevents extinction, while the latter is the fast-track. Or at least that’s what I was able to intuit from watching a Louis Theroux documentary.

          • 0 avatar
            Jack Baruth

            “Rhinos, elephants, tigers, lions etc do NOT need to be penned and shot like fish in a barrel on “hunting” reserves on continental Africa for preservation/conservation purposes.”

            Of course not. You can let them run free on the savanna, where they will be captured and ground into penis powder.

            The African tribes use AK-47s to kill elephants now. Take away the reserves and they’ll be gone by spring.

            http://www.isciencetimes.com/articles/4693/20130313/28-elephants-killed-ak-47-wielding-poachers.htm

          • 0 avatar
            DeadWeight

            Texting in gridlock M59 traffic so typos maybe…maybe governments can really do something to seriously crack down on poaching in Africa, as they have to crack down on piracy on the open ocean…but maybe they don’t prioritize it

          • 0 avatar
            bd2

            Actually, that line of argument has been proven FALSE.

            People who pay to kill trophy animals (many who have been raised around humans and thus, have no fear of them) in canned settings has little bearing on those living in near-poverty and resorting to poaching.

          • 0 avatar
            stuki

            “Actually, that line of argument has been proven FALSE.

            People who pay to kill trophy animals (many who have been raised around humans and thus, have no fear of them) in canned settings has little bearing on those living in near-poverty and resorting to poaching.”

            I’d like to see the standards for “proof” required to make that one work….. Doubt it would get you published in any mathematics journal…

            If people can put a fence around a thousand elephants, then maximize the profits those elephants bring them; as long as the net present value of the income stream derived from Jimmy John paying to shoot one a few times a year, exceeds that of the value of wholesale slaughtering the herd here and now and grinding them up; the herd will be kept around.

            But ONLY because both income streams befall the same guy, giving that guy the ability to weight the value of one against the other. Absent the fence, somebody in no position to collect hunting fees, will kill and grind up the elephants, never mind if the elephants would theoretically command more revenue if kept around for hunting.

            This is what the poachers are doing. The “keep around for hunting” option, is not available to them. If they don’t shoot the elephant, here and now, someone else will. And the only difference will be who is able to feed their children from the proceeds of selling penis powder, and who is not. Come tomorrow, the elephants will be gone regardless.

            IOW, the fence, or more formally, the presumably enforceable current and future property right to the elephants, is what gives keeping them around value to someone (the property owner.) And it only gives him that value, if he can monetize the herd, by selling the occasional trophy to Jimmy John. So, for the herd to avoid being ground up, you need the hunters, AND you need the fence. Ergo, you need fat dudes playing Safari Legend by blasting helpless captive animals. It may not be pretty, nor romantic, but it’s either that, or penis powder. Which is even less pretty nor romantic.

          • 0 avatar
            bd2

            Very little of those profits from big game hunting trickle down to the poor villages.

            And in fact, many volunteers at these so-called preserves who helped raise young animals end up horrified to learn that their former charges were destined for the shooting gallery with some having taken up fund-raising campaigns in order to purchase and bring their former charges to nature preserves/sanctuaries.

            The Siberian tiger was at the brink of extinction and yet preservation efforts in Russia (sans big game/tiger hunting) have brought back the Siberian population to some sort of viability (still endangered).

            Why aren’t there big game hunting for great apes (probably is somewhere) in order to “help” the gorilla survive?

            Cecil the lion and his son were killed by big game hunters and they were wild lions who were lured out of the safety of the bounds of the Hwange National Park.

    • 0 avatar
      markf

      “takes pleasure in faux-hunting large trophy animals such as Rhinos and Elephants, thus being smuggled near-to their large prey, pointing a large caliber rifle at their ginormous heads, and shooting them, rendering them dead, for FUN –”

      Trump derangement syndrome strikes again. You think hunting dangerous is easy you are a fool.

      • 0 avatar
        markf

        “Rhinos, elephants, tigers, lions etc do NOT need to be penned and shot like fish in a barrel on “hunting” reserves on continental Africa for preservation/conservation purposes.”

        Tiger hunting (Tigers live in Asia btw, not Africa) has not been legal for close to 50 years. Penned in hunting reserves? Hunting reserves are 100s or thousands of acres, again your ignorance is only surpassed by your arrogance.

        • 0 avatar
          DeadWeight

          “Tiger hunting (Tigers live in Asia btw, not Africa) has not been legal for close to 50 years. ”

          A LOT OF THE ANIMALS NOW ENDANGERED HAVE BEEN *ILLEGAL* TO HUNT FOR MANY DECADES…..BRAH!…but that hasn’t stopped the poachers.

          Which supports my contention that making something illegal to do, without putting real resources and enforcement (the “heavy stick”) behind it, won’t do jack.

          • 0 avatar
            strafer

            Supposedly, there are more tigers kept as exotic pets in US than there are wild tigers in Asia.

          • 0 avatar
            markf

            “A LOT OF THE ANIMALS NOW ENDANGERED HAVE BEEN *ILLEGAL* TO HUNT FOR MANY DECADES…..BRAH!…but that hasn’t stopped the poachers.”

            Make up your mind “BRAH” Is Trump hunting the issue or is it poaching? Brah. Animals are poached because they have zero value to anyone but poachers. Brah

  • avatar

    What you doin’ Jack eatin’ that sh!t plastic from Jimmy John?

  • avatar
    slavuta

    ” I would have a Continental Black Label in a heartbeat…”

    Another Mexican-made “Luxury”

  • avatar
    sportyaccordy

    I still don’t get the gripe with the Chinese thing. Volvos were second tier in their peak when they were assembled by virgin Aryan youths a snowball’s throw from Ikea’s HQs.

    I’d also love to see similar pricing sheets for bonafide luxury brands. And there are other games that are played. You look at a 330i lease, they put $3K on the hood, and then subsidize the lease with a laughably high residual. $26K for a 3 year old CPO 328i? On what planet? Dealers are happy to get $20-22K for such a car. And they are caught in this death spiral of subsidized leases with a glut of off-lease inventory and resultant downward pressure on monthly payments.

    And this isn’t even getting into the fact that a decently equipped 3 series feels no more luxurious and has worse chassis balance than a Honda Accord LX. Badge whoring aside many of the “real” luxury brands don’t have a leg to stand on. The brand perceptions of a general public that is clueless is worth as much as they know……

    • 0 avatar
      Astigmatism

      I agree with every word of this. BMW, Mercedes and Audi will fall over themselves to put you into a leased yupmobile for a McDonald’s a Day. The further you go up the ladder, the more exaggerated the discounts. And the fact that executive assistants are willing to scrape and claw for a 3-series is a testament to the power of branding, as Jack notes, which says nothing about the car wearing the roundel or how much it justifies its pie-in-the-sky MSRP. I wonder how long it will take before people wake up to what sh~t cars modern BMWs are compared to the competition, with off-lease models overwhelming dealer lots and used buyers puzzling over why the car has half the gizmos of the Honda they’re trading in, the leather feels like vinyl, and their neighbor sold his used 530i two years after he bought it when his transmission died. It took a while, but it happened to Cadillac.

      China-made or no, the S90 strikes me as much truer luxury than its 4-cylinder up-brand competitors.

      • 0 avatar
        sportyaccordy

        Something else to consider is a dealer is probably willing to go easier on the lease MSRP as they know they will be able to make money on the sale of the car upon its return. A bit more forward thinking than is probably realistic but at least grounded in reason.

        Not sure why a full size Scandinavian luxury car being sold at a steep discount warrants complaint. The democratization of luxury- and yes, this thing is luxurious, regardless of what it’s branded or where it’s built- benefits us consumers. A car of this size, build quality and speed would have cost a nominal 2x just a decade ago. We should be celebrating

      • 0 avatar
        Carrera

        Funny you say that Astigmatism. I was playing around a few weeks ago and went to test drive a 2 year old BMW 328d. I left very disappointed when I realized that my 2 year old Corolla S had LED driving lights, sun roof, navigation, back-up camera and the mighty BMW had none.

    • 0 avatar
      Lou_BC

      “I still don’t get the gripe with the Chinese thing.”

      Perhaps an example of people clinging tenaciously to the belief of American Exceptionalism.

      China will soon be the global financial and military superpower.

      • 0 avatar
        Jack Baruth

        When you figure out what being “the global financial and military superpower” has to do with making quality products, feel free to get back to me.

        • 0 avatar
          Lou_BC

          There are those that deride anything that comes out of China which often has nothing to do with the quality of the product.
          As far as China becoming the global financial and military superpower, it doesn’t have a direct affect on quality but it does have a big effect on where profits and R&D money will travel.

        • 0 avatar
          sportyaccordy

          As we did for the decades after WW2? Come on man. Not to mention, China does make quality goods. If they didn’t, people wouldn’t gladly pay 4 figures for an Iphone. There’s zero difference between a Swedish S90 and a Chinese S90 besides your xenophobia. Once you develop and manage a good process it doesn’t matter where you carry it out. All that matters for the quality of a product is where it’s designed, not where it’s built. Honda demonstrated this decades ago by building bulletproof Accords in the same country that designed boatloads of unreliable awful crap. Familiar story?

      • 0 avatar
        28-Cars-Later

        Not necessarily. Depends on the position of whats left of the Anglo-American empire. Who knows, the Russians or even India could surprise everyone as a dominant power.

        • 0 avatar
          Lou_BC

          @28-Cars-Later – I do agree that it does depend what is left. That is where “America First” tear up NAFTA of NAFTA makes no sense. As it stands, China looks like the next one at the top.

      • 0 avatar
        bd2

        How ’bout that the PRC is a totalitarian state and one that is the biggest threat to the US economically and militarily.

        Many things are hard to purchase w/o the “Made in China” label, but there when it comes to autos, there are many other choices.

        Basically, US policy (pushed by big business) has paved the way for the decline of the US and the rise of the PRC.

      • 0 avatar
        DeadWeight

        “China will soon be [THE] global financial and military superpower.”

        There is serious and rigorous debate among many educated people about whether this common presumption will come to be.

        China has never, for a variety of reasons too broad and deep to discuss here, ascended to “total dominant world hegemony” (although a threat that overran the Chinese, and assimilated with them, Genghis Khan’s Mongol Horde, did).

        China is still a nation with a relatively opaque power structure, very opaque financial system, and many exaggerated claims about its military and technological capabilities vis-a-vis projection of global power, and it is also facing massive internal debt problems (its export surpluses help resolve its domestic regional banking losses), massive corruption by the political class, and a demographic crisis (and it inevitably will be a crisis for an export-dependent, jobs-dependent-on manufacturing exports’ nation), among other major issues (including the always present risk of a Jade Revolution).

        • 0 avatar
          bd2

          Yes, there are debates as to all that, but nonetheless, the PRC is much wealthier than it used to be (it’s sovereign fund is TEN times the size of that for the US) and they have been using some of the $$ to upgrade their military, including their navy.

          There’s a reason why the PRC has increasingly been throwing its weight around when it comes to its neighbors and the South China Sea.

          Unless things change for the US policy-wise, we are seeing similar things which exhausted the Roman Empire.

          Endless military spending with little in return, corruption which favored the elite, etc.

          Yes, there are questions as to the viability of the Chinese economy with growing wages, an aging population, etc. – but at the same time, their economy has been built up to a point where they aren’t as dependent on exports (esp. for cheap labor goods) and Beijing has pushed for higher end manufacturing/sales – whether that be autos, high speed rail, solar panels, etc. (In the not too distant future, we’ll see China enter the commercial airplane industry.)

        • 0 avatar
          Lou_BC

          @DeadWeight – good points. I’ve read and seen interviews with academics about the fall of the US empire and who will fill the void. Many feel that China will not become *the* global military/financial superpower. It may be a “collective” of countries like the EU which would explain to a degree why Russia wants to see NATO and the EU collapse.

        • 0 avatar
          hreardon

          Good arguments, pro and con on the China situation.

          The one major difference between China and the Anglo-American way of doing things is that our ‘culture’ is far more fluid and allows for a level of creativity brought about by a respect and focus on individuality versus the collective.

          China might be great at marshalling resources and its people toward a common goal, but (broadly speaking), I believe that Anglo-American individualism is the foundation for much greater creativity and unique problem solving.

          Not being dismissive of the Chinese culture, writ-large, just saying that the pop-culture belief that China will take over the world isn’t necessarily a given (for reference: Japan buying up American assets in the 1980s)

      • 0 avatar
        strafer

        China’s economy depends on manufacturing, and as costs in China rise manufacturing will move on down the line to less costly countries.

        • 0 avatar
          bd2

          Many industries dependent on low cost labor have already moved to Vietnam, Pakistan, Sri Lanka, etc. (many of which are now Chinese owned).

          China has moved to higher-end manufacturing (pushed by Beijing).

          They already have decimated the solar panel manufacturers in the US and elsewhere with cheap panels.

      • 0 avatar

        Wishful thinking. Everyone else thinks that China is on the verge of economic collapse and following unrest – long overdue. Japan also was supposed to dominate world.

  • avatar

    @DeadWeight

    +1

  • avatar
    Alfisti

    Whilst i agree with the premise of the article have you ever tried doing a deal with a volvo dealer? Well in Toronto anyway?

    My last two vehicle purchases i hit up Volvo and with zero luck, they barely budge of MRSP, even the CPO product is near firm and they are priced dead inline with ze Germans.

    I should be your Volvo buyer if there ever was one, i drive a Saab wagon, i want something nice but not ostentatious, value (crash performance related )safety and like my utility. But no deal, forget it.

    • 0 avatar
      HotPotato

      Ditto. I freakin’ love Volvos (nothing in this world is better at keeping you from needing a chiropractor or a coffin, the drive is buttery smooth, and Volvos are lovely to look at inside and out) but I have never met a prick less interested in selling cars than my local Volvo salesman.

  • avatar
    ldl20

    These deals probably came off of leasehackr.com. I am amazed at what quite a few people have leased S90s for. If the product has to be discounted so much, was it ever truly a luxury brand to begin with?

  • avatar
    Lightspeed

    Great article and unexpectedly funny. Made me realize what a comical snob I am. My Lexus GS is now 18 years old, my wife has bashed every corner of it into the garage door, parkade posts, curbs, other cars, and its got some rust – and yet, I snort with derision at my friend’s new Infiniti!

  • avatar
    Steve_S

    I will gladly take a loaded V90 (non CC) if I could get it between 40-45k.

    I’m only seeing $7k off MSRP for S90s in my area and little off on V90 or XC90, basically invoice.

  • avatar
    jkross22

    Another problem lux carmakers have is that when you get in a VW Golf and see how well a car can be made that’s not a king’s ransom, you start looking around and wondering why premium brands are charging that premium.

    Buick Enclave and Nissan Armada are good examples of this too. Really nice interiors, non-luxury brands but fielding solid looking and feeling stuff.

    • 0 avatar
      DeadWeight

      A base VW Golf is a better car, by a fair margin, than a Mercedes CLA.

    • 0 avatar
      krhodes1

      IMHO, a Golf is a premium car.

    • 0 avatar
      baconator

      Yup. My wife is driving a GTI. We test drove lots of stuff and didn’t find any car that drove better, or had more “luxury” anywhere south of $60k.

    • 0 avatar
      hreardon

      jkross22 –

      Absolutely right on the Golf. ’16 GTI driver here and I found the A3 sterile, the (old) A4 too long in the tooth (though with great deals at the time), and nothing else for $30k that offered quite so much along with lots of smiles.

      The A3 and GTI are VW MQB stablemates and share just about 100% between the front axle and the cockpit, including HVAC, steering, transmissions, engines, etc. It’s a testament to the architecture that the two cars feel so incredibly distinct while sharing so much. And by “distinct” I mean that the A3 is the prep school girl who is cute but too vanilla and the GTI is the girl with a few hidden tattoos that amp up the sexiness.

    • 0 avatar
      TOTitan

      Absolutely right on. Our daily driver and in town run around car is a ’16 Golf Sportwagen SE with just one option above the SE equipment…..the adaptive xenon light package. I cant say enough good about it and the lights are just amazing. The only trouble was my own fault. I added a Neuspeed power module that bumped the power by 30 but it caused a pressure sensor to fail. I took it off and easily sold it on ebay, the dealer fixed the sensor and its all good at 42000 miles.

  • avatar
    matt3319

    Forget about Chinese Volvos or $78K discount NSX’s!! I’m all about $200/month Civic Si or VW GTI leases. Now them there are some deals!!

  • avatar
    Kyree S. Williams

    I do disagree with your emphasis that the S90 is made in China. That’s a red herring. I’m sure they produce it to nearly the same quality as everyone else. The main reason the S90 is built in China is because—as you pointed out—it’s the long-wheelbase model, and was primarily intended for the Chinese market, where it should enjoy greater sales figures. Ditto for Volvo’s own S60 Inscription and the Buick Envision. They aren’t necessarily made in China because their automakers were looking for lowest-bidder assembly; they are built there because it makes good sense from a sales standpoint.

    No, the reason the S90 isn’t in the proper luxury league…is because it just isn’t very nice, like you originally said. It doesn’t have the goods. And maybe that’s what gave Volvo the bravery to sell Chinese-made S90 units outside of that market, but it’s a secondary issue. It’s more of a premium car than a luxury one; the being made in China part is just icing on the cake.

    Also, where Volvo’s cars genuinely aren’t as good, I think modern Jaguar and Land Rover are victims of perception. And even then, that’s just *some* of Land Rover’s lineup. Pull up in a Range Rover Sport or the big Range Rover (or probably even that Velar), and you’ve said all you need to say. They continue to be the epitome of high fashion. But for the other cars, I think it’s just about what the leaders of a class are perceived to be. The current 3 Series, for example, really isn’t very nice. The driving dynamics are dull unless you a) upgrade to the I6 and b) select just the right options to make it a proper Bimmer. Otherwise, it’s honestly outdone by an Accord costing 33% less. In that light, why *couldn’t* an XE be as good or better than the 3 Series? The 3 Series sells on the merit of performance and dynamics that aren’t not seen in 90 percent of the units on the road.

    Likewise, I think Infiniti has the mechanicals, but suffers mostly from execution and design. The old G was the closest thing to an E90, but was rough around the edges and felt cheaper. Now, Infiniti is finally getting its exteriors in line with a design language that, if not to everyone’s taste, is at least cohesive and distinct…but the interiors are still awkward and a far cut from the serene, well-designed ones of the Europeans (and Volvo).

    It’s also funny you put Lexus in that top tier, because the main stuff that sells is FWD-Toyota based (ES, RX), or essentially a luxed-up version of a much cheaper product sold elsewhere (GX). And anyway, Lexus had itself an identity crisis because its cars got called boring, which resulted in the spindle-grille, anime styling that everybody here hates. And though Lexus has solidified itself in many people’s minds as a genuine luxury brand, there are just as many people who see it as less-than.

    But I really like this article.

    • 0 avatar
      krhodes1

      Was my Mother’s 3sp autotragic ’83 528e an “Ultimate Driving Machine”? No, not even a little bit, though it was a nice car that lasted a very long time. But I sure wish my Stepfather had sprung for a 533i with a stick instead! BMW has made cars mild to wild depending on options for 40+ years. Not really getting the wailing and gnashing here. They HAD to grow the business or perish. That simple. If they kept selling what they traditionally sold they would be as dead as Saab. And that goes about triple for Volvo. They had to go upmarket to survive.

      But otherwise, I mostly agree with you. Volvo was never ever in the top tier and likely won’t be ever. And they build that car there for the very same reasons that BMW builds X-cars in the US. Infiniti and Lexus are firmly third and second tier respectively. Every time I get an Infiniti for a rental (fairly often, Hertz has loads of them) I marvel at how cheap it feels and how awful the interior design is. Tokyo-by-night in the old-school way.

      • 0 avatar
        FreedMike

        I’d argue Volvo WAS “top tier,” just in a different way. Volvos were bought in droves in the same neighborhoods that you’d find droves Benzes and Bimmers in. Volvo buyers were affluent professionals who valued substance over flash. The substance they were looking for was stuff like safety, durability, restrained style, and probably even a certain political ethos. Someone commented on another thread that Subaru is today’s Volvo, and that was insightful.

        When the substance died (in the 1990s), the brand died.

    • 0 avatar
      bd2

      The S90 is just like the XTS, Continental and RLX.

      Full-size FWD-based “luxury” sedans priced alongside the mid-size segment.

      The ES is similar in size (sharing its platform with the Avalon), but it’s actually priced alongside with the compact/entry-level segment.

      Now, if the rumors of the demise of the GS are true, we may very well see the ES moved up in price segment.

  • avatar
    redwing497

    I have to admit, I got caught up in the whole branding deal when I leased my Audi S3. I have one year left and fully plan on correcting my actions. When I drive down the street and see a $25k midsize sedan with blind spot monitoring, and I look at my $49k “luxury” car that doesn’t even have it (nor navigation, mind you), I just get angry. I do enjoy the car to a certain extent, but it simply not worth the premium to me just for the branding.

    • 0 avatar
      ajla

      “I have one year left and fully plan on correcting my actions.”

      Go for the RS3 this time?

      • 0 avatar
        hreardon

        RS3 is unique, for sure; And the 5-cyl sounds amazing, but at that price point I want something more like an S6 with the V8. But, that’s just me….and, I cannot imagine paying $60-$70k for a car. I’ll be like everyone else on The Vortex and say what I will buy…then get it used 5 years later.

    • 0 avatar
      Kyree S. Williams

      I’m sure the S3 will have it standard soon.

      I’ve been doing a lot of research, and yes, the mainstream sedans are throwing stuff like that in. Soon, it’ll probably be standard on every sub-30K car. At that point, Mercedes-Benz or Audi could advertise, “Well, we spent that money on our drivetrain”, but it’s much easier to just include it and build it into the price.

      That said, my MKS has blind-spot monitoring, and I never use it. The only car I’ve ever driven in which it was genuinely useful was a 2016 Challenger R/T, whose C-pillars are so big that a lot of lane-changing is just guessing and praying.

      • 0 avatar
        hpycamper

        Equating techno doodads with luxury mystifies me.

        • 0 avatar
          DeadWeight

          room!

          A truth bomb!

          I’d rather have a chassis that has 30,000-40,000 NM/Degree torsional rigidity than many of the marginal tech features on many “luxury” or “premium” branded vehicles.

        • 0 avatar
          FreedMike

          @hypcamper:

          Techno doodads have always been a huge selling point for luxury cars. The only difference is the doodads “back then” have largely become standards in most cars – stuff like power windows, cruise control, fancy stereos, etc.

          • 0 avatar
            hpycamper

            FreedMike

            Some, yes, like electic starters. That was a worthwhile technological upgrade. But what about that built-in 2g connection, or that CD based NAV system, etc. that are obsolete in a short time. Or it just stops working. Nothing luxurious about driving around with useless tech. Personally, I could do without the entire infotainment mess that seems to be unavoidable in new cars.
            As for blind spot monitoring, learn to adjust your mirrors. And NAV, $200-300 new Garmin will serve you well. Throw it away when no longer useful.
            I think a lot of this comes down to how long you intend to keep your car. For me, luxury should endure.

    • 0 avatar
      hreardon

      redwing –

      not to pour salt on the wound, but how the heck did you end up leasing a $49,000 S3 and not have the Prestige trim with all the goodies? Three years ago a fully loaded S3 was around $47k.

      (your overall point well taken, however)

      • 0 avatar
        redwing497

        Totally ok. Pour the salt, I deserve it. Basically, I only got the packages that I really wanted. Black optics and super sport seats. 49 is overstated just a bit, but it was over 48. I think 48,250. The tech package with the Navi and BSM was another 2 or 3 grand and the led lighting package was over $1k. These things fully loaded can get to 52 or 53 and the resulting lease price was just something I wasn’t comfortable with. I got an ok deal on mine but if I ever do something like this again (unlikely) I would go for something like an S4 instead a juiced up economy car. Seriously, my S3 is basically a golf GTI. Which is A great car, but you can tell the S3 has economy car roots. That’s really the best way I can put it.

        Great observation about the price. I accept full responsibility for my actions lol

        • 0 avatar
          hreardon

          Your comment on the S4 echos my logic on the situation when I was looking to buy two years ago: At the price point, spending a few bucks more for the S4 makes a ton of sense, or spending a lot fewer bucks for a loaded GTI or even R would be the buy if you don’t care about the badge or sedan vs. hatch.

          Frankly, unless and until I’ve got the free cash where a $50-$70k car makes financial sense, the GTI will be my go-to for the foreseeable future.

  • avatar
    dwford

    Middle luxury brands will survive precisely for why they are fake luxury: development costs are low because they use the same platforms as their mass market siblings. These cars don’t really cost much more to produce, yet even with discounts the transaction prices are higher than the also discounted mass market versions. Are you telling that Lincoln isn’t making money on the MKZ? Or that Infiniti isn’t making money on the Q50 (which is using the 15 year old FM chassis STILL – must be paid for by now)?

    Now brands like Volvo, Jaguar, Alfa Romeo, Genesis etc that have no mass market platforms to start with, THEY are surely going to have a tough time.

    • 0 avatar
      Kyree S. Williams

      Jaguar / Land Rover used the 2000-era DEW98 platform (co-designed by Ford and Jaguar engineers) for the XF until its recent redesign. They also have their FWD D8 platform, which is a heavily-modified version of Ford’s EUCD architecture. D8, up to now, has only been used on Land Rovers (Discovery Sport, Range Rover Evoque), but will underpin the upcoming E-PACE crossover.

      • 0 avatar
        dwford

        They can’t use those old platforms forever. And they are finally ditching the Ford engines too. So they are on their own in developing future platforms and drivetrains, with no amortization with mass market models possible.

    • 0 avatar
      bd2

      Think Genesis will be fine.

      First off, they have their domestic market which accounts for a healthy amount of sales (esp. for the G90).

      Then there is sharing the cost of development with Kia – which aside from the Stinger and K900 replacement will probably include at least one Kia RWD CUV.

      Actually think Toyota/Lexus is in more trouble when it comes to their RWD platform(s) – even with the Crown series in Japan.

      The massive crash in sales of the GS and LS hasn’t been good for Lexus’ bottom-line; hence, rumors (once again) of the demise of the GS and Lexus taking their sweet time in replacing the LS460.

      • 0 avatar
        Lightspeed

        I love my old GS. No it’s not as sporty as a 5-Series, no it doesn’t have the prestige of an S-Class. But, it’s got a V8 that drives as-new 18 years on and an interior that looks barely five years old. It’s still smooth and quiet and just feels like it will go forever. There’s something to be said for durability and consistency as luxury traits. I am disappointed with Lexus for making the V8 part of the very expensive GSF trim level, when it was simply an option on the 2nd generation car.

  • avatar
    cicero1

    What you call luxury is stupidity much of the time. Example: Porsche profit margin per car in 2015 was $17,250.00. The margins on things like marble counter tops, mc-mansions, etc. are often more than 50%. the profit margins are those high end watches – 100s of percent. I’ll stick with invicta, and invest the money I have left over in stock of luxury companies selling to fools.

    • 0 avatar
      Jack Baruth

      Good call!

      What are you going to do when your investments mature?

      Wait, don’t tell me… you can spend it on your nursing home.

    • 0 avatar
      bd2

      Would forget the Invicta (actually trash and no better than the fashion-branded watches).

      Buy a nice middle-market Seiko or Citizen (retail being around $500 to $1k but can be had for less).

      A $5k Grand Seiko will have better build quality than a Rolex of a similar price.

      • 0 avatar
        cognoscenti

        This. I love watches, and have bought (or been gifted by loved ones) a bunch of them. Of them all, the Citizen is actually my favorite. The fact that it will always read the exact time without setting and will never require a battery replacement or winding is just icing on the cake.

    • 0 avatar
      SSJeep

      Porsches profit is driven by lots of useless add-ons like a crystal in-dash analog quartz clock costing $3000 or a different color of the same nubuck leather for an extra $10k. And that many people will gladly pay sticker for these “privileges”.

      But they are an absolute blast to drive for the most part.

  • avatar
    FreedMike

    Are we really talking about luxury, or prestige? They’re two very different things.

    Luxury, to me, means nicer materials, better styling, more performance, higher technology, more features, etc. Lots of cars are luxurious, including the Volvo in that picture. But that Volvo isn’t prestigious.

    Prestige is different. I’d argue prestige is best defined as the effect of luxury over time. It’s what a brand stands for in the long term. Some brands are able to achieve this; others aren’t. I’m glad Jack included that Volvo, because it’s a good example of how luxury car prestige is built and destroyed.

    Once upon a time, Volvos were highly prestigious cars, bought by successful, educated, affluent people for whom prestige meant something. These customers were willing to pass up glitzy luxury cars and buy Volvos because buying one meant you valued safety, durability, and a simple but elegant Scandanavian design ethos. The brand stood for something, and everyone knew it.

    I’d say Volvo’s prestige was destroyed by the ’90s. Two things happened: a) the rest of the automotive market caught up safety-wise, and b) Volvo started making junk that masqueraded as a Swedish BMW. At that point, Volvo ceased to stand for something, and it lost its’ prestige.

    So…why does Mercedes have prestige when it sells the CLA, which is best described as a glorified Focus? It’s simple: their expensive offerings (E-class, S-class, SL, G-wagon) really do exemplify what I’d call “traditional Mercedes virtues.” Mercedes can get away with calling the CLA a “luxury car” because it makes the best luxury cars in the world. This gives Mercedes prestige, even if the CLA doesn’t earn it.

    Mercedes could have easily gone Volvo’s way. They could have cheaped out the S-class and SL. They could have switched to FWD platforms to save money. Heck, they could have even sold Chryslers as Benzes for a few years, and raked it in. But they didn’t. And as a result, the CLA isn’t nearly as cynical as a Chinese Volvo with JC Penney-style “mark it up laughably, then discount it to hell so people think they’re getting a deal” pricing.

    Jack’s right, but in the end, it’s not fake luxury – it’s fake prestige.

    • 0 avatar
      Lou_BC

      FreedMike – very valid distinction

    • 0 avatar
      stuki

      Was Volvo ever even remotely prestigious anywhere outside second tier US university towns bereft with inferiority complexes, and amongst those who spent their college years there? In Europe, they were always a Swedish Opel. Or Peugeot. Or Vauxhall. Never a Benz, BMW nor Jaguar. The 240 must have been about as close to a Scandinavian Volkswagen, in the literal sense, as anything apart from the real thing.

      In America, Dumbass McCarthy succeeded beyond his wildest dreams in making sure cultural trend setters were either Left or Left Out, while The Soviets were a bit too obvious about being completely lost even for those guys; so “Swedish Social Democracy,” and with it anything from Ikea to wooden clogs to mythical promiscuous blond bikini teams to nice enough but entirely average Swedish cars, became associated with something Hollywood trendsetters would approve of by deeming “smart.”

      Which worked well enough, until the Scandinavians of relative privilege, even if theirs were not nearly as great as in most other parts, realized they too could “embrace market forces” (to the progressively indoctrinated, just another way of saying: Central banks print up asset appreciation so those who have, gets more, those who don’t, fall further behind; while the government enforces “property rights” like bans on anyone else from building a house next door competing with mine.)

      Resulting in the whole host of financialization pathologies that have destroyed the rest of the West, invading Sweden, and Swedish corporate culture, as well. Leaving Volvo to attempt “capitalizing on their brand” and similar nonsenical mumbo-jumbo preached by less-than-zero inanimen whose wealth, influence nor talent never derived from anything more than simple central bank welfare.

      Leaving Volvo to chase after the pretension they were somehow “luxurious.” Rather than being the functional people movers designed by and for a place and time where the people being moved could all afford to enjoy a relatively high, but never luxurious, standard of automotion. Of course, cars are complicated things to design and build well. Far too complicated to leave much room for “brand managers,” “business analysts” and the other assorted less-than-nothings endemic to the financialized dystopia era, to have much influence over; lest everything goes down the drain in a hurry. Re Volvo in the 90s and onward.

      • 0 avatar
        Lou_BC

        @stuki – well said!

      • 0 avatar
        FreedMike

        @stuki:
        “Was Volvo ever even remotely prestigious anywhere outside second tier US university towns bereft with inferiority complexes, and amongst those who spent their college years there?”

        Yes, it was. I grew up in an EXTREMELY affluent suburb with precisely zero college profs or other anyone you would consider to be leftist/granola. Why? Because leftist college profs didn’t make nearly enough to buy a house where I lived (on the winding country road that leads to my old neighborhood, the average home now sells for upwards of $1 million). It was doctors, executives, business owners and entrepreneurs, lawyers, and other professional types. And Volvos were VERY popular there. It was almost like an imported Buick, if you will.

        Most of them were probably turned on by how safe and solidly built Volvos were – and they were, in the brand’s heyday. Not everyone with money is flashy about it (indeed, it’s actually counterproductive for some monied folks to show it), and back then, a Volvo was a perfect car for them. They were just after a different kind of prestige.

        • 0 avatar
          bd2

          Wouldn’t say Volvos back then had the same sort of “prestige” that BMW had (which, btw, wasn’t high either when they first entered the US market took some time before they became known as the “yuppie” brand), much less MB.

          But not everyone wanted to spend a ton of $$ on their cars (or at least on every car they owned) and Volvos were seen as very sensible and safe cars (perfect for transporting children around).

          Not usual for a family to have a Porsche (dad’s car), E Class (mom’s car) and the 3rd car being a 240 wagon (kid duty).

    • 0 avatar
      hreardon

      Great points, FreedMike. Mercedes came close to pulling a Volvo back in the 90s when they decided to cheap out, reduce reliability and stop innovating. Their renewed focus on building true ‘luxury’ land yachts and a big improvement in reliability restored their brand value.

      I completely agree with you that they can pull of the CLA because the rest of the lineup is so strong. When Cadillac tried this with the Cimarron and the Catera they were a wounded brand whose cachet was disappearing as their clientele literally died off.

  • avatar
    Tstag

    I recently bought a nearly new BMW over a Jaguar XF, despite the fact that I much preferred the Jaguar. Why did I do it? Simple the BMW was several thousand pounds cheaper. BMWs are amazingly good value second hand Whereas JLR and Mercedes products in the UK at least hold their value better. Therein lies a problem for BMW their cars are no longer considered special enough to warrant Jaguar levels of price. The best of this story is that I traded in a MINI Cooper for a 3 series Tourer of the same year and only spent 1000 pounds on the trade in! That tells you just how far BMW has fallen!

    So back to Jacks article in Europe I would say Land Rover, Mercedes and Audi are the level 1 car makers with BMW in danger of getting relegated to Level 1b. Jaguar is now vying for promotion….

    • 0 avatar
      TOTitan

      I did something similar in 2012. I was able to pick up a CPO 335d with just 30,000 miles for $28,000. Just about to roll over 100K now and Im totally addicted to torque 425 lb ft at 1700 in a 3 series makes one amazing road trip car. BTW… no carbon issues. I disabled the EGR motor and deleted the swirl flaps…problem solved.

  • avatar
    Carzzi

    So tell me, this V6 is a — _supercar_?

  • avatar
    ra_pro

    There is a lot of truth in what the article talks about and what others commented. However I think number one reason “luxury” real or fake is expanding is the basic principle of capitalist economy. No matter the size of the company, you have to expand or grow or at least you have to pretend that you’re working on that growth thing even if you are actually shrinking. It’s the basic premise of capitalism. Even the real luxury brands are under pressure to offer discounts, deals because they need to grow. Once all your potential customers have your product or your competitor’s product how are you going to grow? The only is to look at the second tie customers and offer them something hence CLA; in the case CLA it’s probably 3 or 4th tier customer, the second tier gets the C300.

    I was interested in getting another car this past year so I watched closely how the deals went, nobody was exempt from dealing except perhaps Alfa. And I am not sure what their plan is whether they want to commit suicide in the first year back in NA as they have hundreds of unsold Guilias yet refuse to budge and offer serious discounts.

    This is also a global problem that affects many industries not just cars. The global economy can produce more goods then there are customers so naturally the only way to sell these is to discount them. A lot of these goods will have to be sold at a loss. Can the produces withstand the loss? It depends, some can some cannot or can only for a short period of time.

  • avatar
    Zykotec

    Sad but true, at least for many of the ‘in between’ automakers. But we are coming into a world where there are only pure luxury or good deals to be had. And it’s not only cars. Smae goes for Phones, furniture, kitchens, housing etc.
    I disagree a bit with the makes you mention, except for some Mercedes models. All 4 of those are still fighting to stay relevant and have competitors, and they make cars for ‘normal’ people too. And they can be bought used.

    They can and will also be punished for any huge mistake they make.

    The true luxury brands today that are almost above reproach (in my opinion) are ‘mainstream’ brands like Ferrari, Aston Martin, Lamborghini, Bentley and Rolls Royce. And some specialist car makers that make only a few awesome cars each year. (inlcuding some that modify both used and brand new cars)

    They all make cars that are out of reach for most people, and are too expensive even as used cars (if not to buy, at least they are too expensive to use/maintain.)
    Even (new unmodified) Porsches aren’t as exclusive any more, thanks to thousands of decent cheap used Cayennes and Boxters on the roads diluting the brand. Not to mention the Macan…

  • avatar
    Jack Denver

    A real luxury car, regardless of badge, does not have a 4 cylinder engine and a FWD platform. This is true whether it is a Mercedes CLA or a Volvo S90.

    Regarding the S90, I really worry about the long term durability of the thing and not just because it is made in China. Yes, it is possible to get 300HP out of a 2 liter 4 cyl. engine. Yes it is possible to put both a turbocharger AND a supercharger on the engine in order to do this. But is it possible to do this and make a motor that will run trouble free for 100,000 or 200,000 miles and for 10 or 15 years? I’d have a lot more confidence in a naturally aspirated V-6.

    • 0 avatar
      Zykotec

      If it wasn’t for Audis and Minis, or even Infinitis and Acuras from the 90’s, you wouldn’t have been wrong. But you kinda are.
      To some people prestige and luxury is actually about progress and technical advancement, and not about trying to make a mid 50’s American car with oversize wheels.

      • 0 avatar
        bd2

        There’s a reason why Audi doesn’t sell the FWD version of the A7 and A8 here, and there are indications that Audi may go to a RWD platform for the next A8.

        During the 90’s and until fairly recently, Infiniti was mostly RWD – which was costlier and made it harder for them to compete with Lexus’ increasingly FWD competition.

        For instance, the FX CUV was a relatively slow seller for Infiniti; buyers just weren’t interested in a “sporty” CUV (unless it was from BMW and later, Porsche).

        That’s the reason why Infiniti came out with the FWD JX (now known as the QX60) which sold better than the FX.

        And despite the JX/QX60 being LARGER than FX, it got a LOWER nomenclature than the FX (which became the QX70).

        As for Aura, their sedans have increasingly been seen as “tarted up” Civics and Accords and with the new Civic seen as being superior to the ILX.

    • 0 avatar
      Maymar

      You know, I think if you’re worried about the longevity of a small boosted engine from a company with a long history of small boosted engines which last pretty decently even as the rest of the car nickle and dimes you to death, I don’t think you’re the right buyer for any European car. Seriously, small turbo engines will last fine with care, but there’s the myriad little motors, screens, air suspensions, those will all be what does in your typical modern luxury car.

      Hell, everyone loves their power, and then conveniently forgets how often the transmission is the weak link because it can’t handle the power that’s being routed through it.

    • 0 avatar
      bd2

      Well, that means the bulk of C Class, 3 Series, A4 and even 5 Series and A6 sales aren’t “luxury” due to having a 4-banger.

  • avatar
    28-Cars-Later

    Mad props for the Ronin reference.

  • avatar
    bd2

    Baruth’s take on this is pretty simplistic and full of holes.

    Take Audi and Lexus, for example.

    Audi still lags WAY behind its German brethren when it comes to luxury sedan sales in the mid-segment, much less flagship segment.

    The A6 is outsold by the likes of the (“fake luxury”) G80 and the A8 is sold by the G90.

    In fact, the same can be said of Lexus’ offering with the GS (with rumors of it demise) and LS being sold by Genesis (the new LS will reverse this, at least for the time being).

    Audi’s growth has primarily been in the lower-end of the luxury market when it has come to sedans (A3, A4) and with crossovers (where there is less of stigma here in the US with a FWD-based platform).

    Nonetheless, things are even worse for Lexus.

    In the past, the GS and LS handily outsold the A6 and A8 (nevermind new entrants like the G80 and G90).

    Lexus used to sell 30-35k of its larger RWD sedans with RWD-based models making up a significant % of its sales.

    Nowadays, the only Lexus sedan that sells well is the FWD ES and all its other top sellers are cheaper, FWD-based models (basically crossovers), such as the NX and RX.

    Don’t see why Acura or Lincoln should get dinged for being “tarted up” Hondas or Fords when the majority of Lexus models (including its BoF SUVs) and its best sellers are all “tarted up” Toyotas.

    Just 16% of Lexus sales are made up of models not sharing platforms with FWD or BoF Toyotas.

    Seems to me that the overwhelming majority of Lexus buyers are not opting for Lexus’ “real luxury” offerings.

    And then there are things beyond that.

    Luxury means not compromising (t least too much) on size/space/comfort, power, refinement, amenities and quality (esp. interior quality).

    Until this current generation, the compact/entry level sedans like the C Class, 3 Series, etc. were not “luxury” (and yet, they are by far the best sellers), and the sub-entry segment models like the CLA are most definitely not luxury (says something when a Civic or Elantra Sport have a better ride/refinement).

    Maybe a 4-banger in a compact or sub-entry is OK, but a 4-banger in a midsize like the 5 Series?

    Yes, there is a growing disparity between not just the immensely wealthy and the middle class, but between the immensely wealthy and the upper-middle/professional class.

    The immensely wealthy can afford to purchase/lease a flagship sedan/crossover/SUV with all the bells and whistles, much less hypercars costing 7 figures.

    The professional class is struggling to keep up with the rising cost of autos (due to all the added tech, including safety and semi-autonomous tech).

    • 0 avatar
      bd2

      So if they have the choice of purchasing/leasing an Acura MDX that is well-equipped or a base X5 (or a better equipped, but significantly smaller X3), many of these buyers will opt for the MDX or something along those lines (like the new 3-row RX).

      And oh, Breitling in the watch-world is not “fake luxury”; they’re just on the lower end with other brands like Bremont, IWC, Tudor, Tag, Zenith, etc.

      And Seiko makes well-respected luxury watches with its Grand Seiko collection and other lines, including tourbillons which cost upwards to half a million.

      Much of this is just marketing.

      Is the Acura NSX any different from a Honda NSX simply b/c of a change in badge?

      Same goes for all Infinitis which are branded Nissans in Japan (or even as rebadged Mitsus).

      The Toyota Crown Majesta is actually more luxury than the Lexus GS and seen as a more staid “flaship” compared to the “sportier” LS, which isn’t even the flagship sedan in the ToyoCo fleet – which is the Century.

      Mercedes has a different image in Europe than here – with all those taxi-fleet specials and commercial trucks and vans, including sanitation trucks running around.

  • avatar
    GS 455

    I would love to have the Acura NSX. Twenty or thirty years ago the arrival of a new supercar was an event and I’d rush out and buy every car buff magazine with one on the cover. These days I’m so jaded with all the Lambo, Ferrari, McLaren, Porsche supercars and their 2.5 sec 0-60 times, and quarter mile in less than 11 sec times that I don’t even bother reading about them. But the NSX with all it’s mechanical technology just fascinates me. Sadly, up here in Canada I doubt we’ll see any $49.000 discounts.

  • avatar
    W210Driver

    Maybe I am crazy, but I actually can appreciate the Mercedes CLA. My partner drives a CLA250 which I have driven for thousands of miles. I would describe the car as agile with good handling qualities and, why yes, even fun to drive. Keep in mind that fun to drive is highly subjective, and I feel that many reviews have been unfair towards the CLA in that regard.

    I believe that the typical CLA buyer knows what they are buying – an entry-level Mercedes. They will have lower expectations than the buyer who walks into a dealership eyeing a C-Class. It is safe to say that this car is targeting younger buyers who desire a premium and sporty vehicle. Premium and sporty are subjective terms, but the CLA fulfills them to the average buyers to a certain if not high degree. Luxury, is subjective after all. And the CLA can be specified with luxury amenities. In short, the CLA can be individualized to suit individual buyer tastes. At this point I would like to mention that my partner could afford a C-Class or higher, but he preferred the styling of the CLA. The lower price was also a bonus!

    Is the CLA perfect? Nah, far from it. There are massive and annoying downsides to the CLA, such as the lack of room in the rear and obstructive A-pillars. The cold engine sounds raspy, but once it warms up it‘s unobtrusive (unless you floor it). Personally, I have no issues with the vehicle from a performance, refinement and interior quality point of view. I know people like to slam the interior, but the cabin quality and materials look and feel premium to my eyes and hands -though they are definitely below the quality of the current C-Class cabin. It‘s a decent car, and to me it definitely feels premium and competitive.

    The CLA is hardly my favorite product from Benz, but I don‘t believe it is as bad as people claim it is. Just my two cents. I think this is a highly subjective issue and this is why people should be able to buy whatever car they want without criticism being aimed at them. People buy cars for different reasons, be it emotional, logical, aesthetic… whatever.

    • 0 avatar
      bd2

      Except the CLA is neither “premium” nor “sporty.”

      The CLA is unrefined and rides/handles worse than pretty much everything in the main-stream compact segment (Civic, Forte, etc.).

      Audi did a proper job with the A3; can’t say that for MB with the CLA.

      • 0 avatar
        W210Driver

        I’d have to politely disagree. :-)

        The Civic is sporty, but so is the CLA. Both are sporty cars in their own way. They won’t drive similarly, but they offer a sporting experience to the operator behind the wheel. Maybe the Civic is more rewarding to drive for the enthusiast. But place the average consumer behind the wheel of a Civic and a CLA and they won’t be able to tell which one is sportier.

        The regular CLA is not a car for enthusiasts. The CLA45 AMG on the other hand…

        • 0 avatar
          bd2

          The CLA drives rather poorly and more importantly (for a supposed “luxury model”) rides horribly.

          Guess for drivers who wouldn’t know what a sporty drive happens to be, may think that the CLA is “sporty.”

          Simply no contest between the CLA and the A3.

    • 0 avatar
      Snooder

      Yup.

      My dad traded in a E350 for a CLA250. He constantly raves about how much better the CLA ‘drives’, mostly because it’s smaller, lighter and AWD and that works for him.

  • avatar
    deanst

    The real story is not the death of near luxury brands, it’s the ability of the Germans to attack the upper reaches of the mainstream brands. Why buy a Ford titanium anything if your neighbourhood BMW or Mercedes dealer can get you into a fancy logo for the same low, low monthly cost? It doesn’t matter if the Ford is a “better” car, the German auto gives you something you want, that can’t be replicated by a titanium sticker on the fords bumper. You can call them brand whores, but why judge others buying what they want? I can ridicule the guy paying $80,000 for a pickup, but pollution concerns aside, if that what he wants, more power to him.

    • 0 avatar
      bd2

      They’re doing so b/c the mainstream brands are doing a good job of attacking the lower-middle end of the luxury brands.

      That’s the reason behind Ford’s Vignale sub-brand in Europe, and the Denali sub-brand and SX-L trim (for Kia) in the US with the new Avenir sub-brand joining them.

    • 0 avatar
      tnk479

      In my experience, you’re damned if you do, you’re damned if you don’t – people are going to judge you in any way to ease their own insecurities. If you buy a real luxury car, some friends or family will judge you for over spending on an auto. How shallow of you. If you buy a cheap car, some friends or family will judge you for being cheap or assume you must not be doing very well. If you buy an entry luxury car, some friends or family will judge you for being a poser or trying to show off. What is the perfect car for which no one will judge you? Such a car does not exist. Just get whatever you enjoy the most.

  • avatar
    dal20402

    There’s a lot of misguided carping about Lexus in these comments. Jack got Land Rover utterly wrong, but he got Lexus right. With the average person, it stands right with the Big 3 Germans. And the fact that it sells very few RWD sedans today really doesn’t affect that. The defining Lexus products today are the LX, RX, and NX.

    The reason is that, spindle styling aside, Lexus has embraced a certain kind of luxury in a way no one else has. And certain luxury buyers LOVE it. You really can’t get the experience of a properly equipped Lexus from any other brand. And what is that? Two things, really.

    1) Softness. The seats are softer, the ride is softer and less jarring (although still reasonably controlled in most of the products), there are real soft-touch materials in most places, and the steering wheels–where your fingers sit–have the softest leather short of an exotic brand. This is especially valuable at the smaller end of the lineup, where the truly luxurious NX is up against things like the X3 and GLC that, especially in low-price form, ride hard and feel cheap. The NX is the most comfortable small luxury CUV by a big margin. it’s a different kind of product from the competition in the same way that the ES is different from a 3 or C-Class.

    2) Very good reliability. The reason I own an old LS460, even though it was significantly more expensive to buy than an S-Class or 7-Series of similar age and mileage, is that it has the best reliability record of any luxury sedan. And, sure enough, absolutely nothing has broken in my ownership (although some suspension components wore out). Lexus has been very consistent with that sort of record throughout its lineup, with pretty much no turkeys in its history. Compare that with big BMWs that need a new $600 battery every year or Benzes that can’t keep air suspension going for five years and you can see the owners’ point.

    • 0 avatar
      bd2

      The “average person” thinks that Bose and Beats are “hifi”/high-end audio.

      And the proof, as they say, is “in the pudding” – on this case, average transaction prices and MSRPs relative to the competition.

      The ATP for Lexus is more in line with that of Acura and Lincoln than with MB and BMW.

      Cadillac, in fact, has an ATP that is more in line with the Germans.

      This is in large part due to increased reliance on FWD-based vehicle sales due to the sharp drop-off in RWD sales.

      And as is customary, FWD-based models are priced 1 size segment down (or in the case of the ES, 2 segments) compared to the RWD competition.

      That’s the reason why auto rags in comparison tests pit the RX against the X3 and GLC and the NX against X1 and GLA.

      Not only that, the compact segment X3 and GLC go higher in price than the midsize RX

      Despite all the protestations from Lexus, they are seemingly now planning for a CH-R based Lexus model which will make things even worse.

      When the ES was switched to the Avalon platform, Lexus could easily have moved it up the midsize price segment along other similar FWD-based models like the XTS, MKS (and now Continental), RLX and S90, but they didn’t since they knew they would lose a chunk of ES sales volume with the higher pricing (along with not wanting to compete head to head with the GS).

      But if the rumored demise of the GS turns out to be true, Lexus very well may have to take that risk.

      In addition, the IS has significantly lower ATP than the 3 Series or C Class.

      Even with the 320i being BMW’s designated A3 and CLA competitor for the time being (until a proper 1 Series competitor is prepared), the 3 Series has the highest ATP in the segment due to the popularity of more powerful trims, much less the M3/M4.

      In contrast, the most popular trim of the IS was the weak-powered IS250 (making up 90% of IS sales) which even put off Consumer Reports.

      Lexus has tried to garner more of the enthusiast crowd, but they haven’t exactly have had much success in doing so (and all those FWD CUVs aren’t going to help).

  • avatar
    pmirp1

    I think mid luxury (old Buick and Volvo) these days is defined as Jeep Grand Cherokee, 4 Runner, Tahoe and Yukon and Nissan Armada. Most of America pays mad respect to these vehicles. Genesis is doing a great job for an up and coming brand. Most cohesive design and power trains.

    For luxury probably a high end Mercedes SUV or Land Cruiser or Range Rover or Denali.

    And for blue collar luxury a Ford F-150 Lariat and above is luxury.

    Why would any one buy a complex NSX when a better looking simpler Stingray is available. Hope GM doesn’t screw Corvette by going mid-engine with a complex engine and price people who have stood by Corvette all these years can’t afford.

  • avatar
    threeer

    That picture of the three Buick SUVs just makes me sad. One manufactured in Korea and the other in China.

    I tend to agree with the assessment that this is more a matter of luxury perception than true luxury (or even near luxury). Sure, any number of cars are likely better than the CLA250, A3 or (and this one breaks my heart being a lifetime Bimmerfan) 320i. But image still sells, and price moves metal. I can get a *relatively* cheap lease on either of those three and that puts a three-pointed star, four rings or a Roundel in my driveway. I’d venture to say that a large majority of the public care not one whiff of the drivetrain configuration of any of those, only the badge up front.

    The “in the middle” isn’t a bad place to be, car-wise. Look at what all comes standard these days in most mainstream cars. An Ohio-built Accord or Kentucky-built Camry can be optioned to levels reserved for true premium cars not that long ago. Why stretch for something more prestigious…other than perception.

  • avatar
    Tstag

    I am loosing faith in Jack. How can Lexus IS a premium tier 1 car maker and Land Rover a second tier car maker? Land Rover make cars that sell for in excess of 150,000 USD. Lexus was Toyotas in drag. The cheapest Land Rover is either the Discovery SPORT or the Evoque. BMW will sell you a 1 series for a lot less! If anything it’s BMW that’s making the tier 2 cars!

    • 0 avatar
      Jack Baruth

      Ask your neighbors, they’ll tell you. Seriously.

      • 0 avatar
        bd2

        See plenty of Range Rovers in my neighborhood with Lexus being a relative rarity (the odd LS or GX/LX).

        Something like the RX is seen as the “nanny’s car.”

        Have to differentiate from what the “mass market” thinks and those truly at the upper-income/wealth demographics.

        The mass market thinks that Rolex is the apex of watch brands (it isn’t) and that Bose or Beats are “hi-end” audio brands (they aren’t).

  • avatar
    Ban-One

    personally do not care what the pretentious think about my choice of vehicle brand, some of whom likely voted for trump. i would be way more impressed with a restomod than anything germany, tokyo or detroit can produce today.

    equally also believe a person who sports a patek (or other 5 or 6 figure watch) on their wrist to be a shallow individual. i would be willing to bet melinda gates or warren buffet don’t wear a patek. anyway, true luxury is not having to be concerned what time it is

    • 0 avatar
      thornmark

      >> some of whom likely voted for trump<<

      few, the pretentious and 1%ers are reliably Dems, especially the ones immune from Dem policies. Look at WY, where every county is GOP but the trust fund county which encompasses Jackson Hole. Wherever trust funders congregate, you'll find they mostly voted for BO and hillary.

      Trump voters are middle America. They are pickup people.

      • 0 avatar
        bd2

        The majority of 1%ers (even more so the 0.5%ers) are Republican.

        Where Dems have made inroads is with the educated, professional class – most of which are upper-middle class, albeit some have made it to the 1% , but still not independently wealthy (much less uber-wealthy).

  • avatar
    thornmark

    I guess this makes Mazda’s plans to move upmarket abortive.

    Maybe the Borg aka Toyota will absorb them into the collective.

    • 0 avatar
      bd2

      Mazda is trying to be what VW is in Europe and used to be in the US.

      Certainly is a daring strategy for the US market, but works well in others (Europe, Canada, Australia, etc.).

  • avatar
    Robert

    Tactical question….when should I start looking for those NSX lease returns to buy one? I won’t buy new, but crossing the $100k barrier for a sub-20k mile seems possible, and interesting.

  • avatar
    frank908

    Luxury is just a word. It’s only been just a word for at least three decades. It doesn’t equal status. The brand itself doesn’t necessarily convince onlookers that you’re are something to behold, but the level within that brand may. An Audi A3 is a joke; an Audi A4 entry-level; but an RS8 is status (brand new that is). The CLA is depressing, and C-class is too; the S-coupe and GT AMG is definitely carrying its own cache.Alpina 7-series are serious dough; anyone who knows what they’re looking at isn’t thinking “but hey, there’s 320i switch-gear in that”.
    I think BMW and MB start high and go low. Audi and all the rest start low and go high and THAT makes the difference.

  • avatar
    tonygrantony

    I agree that there are different tiers of luxury, but I don’t necessarily believe that it applies brand-wide in every instance. The new Volvo XC90 is 100% on the same tier as similarly equipped Audis and BMWs, and I strongly believe that it is stealing buyers from higher-tier luxury buyers in the market for a mid-size/full-size SUV. All that being said, the Volvo S90 is despite its wonderful styling still a second-tier luxury sedan. Same goes with the Range Rover line, for example.

    Similarly, I would agree with others here that the base Mercedes Benz CLA, with its god-awful three spoke steel wheels and 1990s Mitsubishi Mirage push-in door locks, is not a luxury vehicle. However, for the vast majority of Americans, all they see is the badge. But it pains me to see some consumers overlook a Honda Accord Touring, which has more features, better textures/upholstery, and a better price point.

    When it comes to the impending death/consolidation of near-luxury brands, I’d say that the value proposition is out the door. A fully-loaded 2003 Accord was a fully-loaded 2003 Accord. When well-equipped, the new 2018 Accord (and its predecessor) is indistinguishable from a luxury vehicle. My dad owns a 2017 Accord Sport with the 19″ alloy wheels and gets compliments all the time. On his Accord.

    It’s the mid-tier, high quality brands who’ve stepped up their game who are killing near-luxury brands. Honda is killing Acura, for instance. Honda has an almost sterling, bulletproof reputation with great resale value, lots of options and new features, and nice textures on EX and up trims. I was blown away by how nice the soft plastic feels on their newest models. Yes, it’s soft plastic. But at its price point, it was unimaginable a decade ago.

    There really is no “value proposition” to buy an Acura ILX or TSX, which generally comes with less features than a well-equipped Civic/Accord and leaves you in no better standing with uppety folk in the country club parking lot.

    That being said, Lexus is indeed an exception. But they’ve gotten there by stepping their game up as well. Five or six years ago, I wouldn’t notice a Lexus in front of me, but now I do. Their garish, absurd, and over-the-top styling definitely isn’t going to age well, but it’s turning heads and bringing luxury buyers back into the dealership.

  • avatar
    conundrum

    “Two weeks ago I told you about the Chinese Volvo S90, the Volvo S90 that is built in China. It’s the equivalent of a department store suit “designed in Sweden” but constructed by the lowest bidder.”

    Yes, and the statement is as preposterous now as it was then.

    More than half the Volvos made in Europe come out of the Ghent, Belgium facility and have for several decades. Are these Belgian units ersatz Volvos by your definition? Should the United Snoots of America downgrade any Belgian-made Volvo? Or, as is more likely, they just didn’t know the facts? Being so well-informed and all.

    The Volvo facilites in China – are they nothing more than a tin shed? Highly unlikely. They’re probably more modern than those in Belgium or Sweden. So how do they turn out tinfoil S90s? Geely is hardly the low cost contractor for itself; they could probably get Light of Dawn Enterprises down the road to assemble S90s if they wanted to make cheapo ones.

    S90s don’t sell because they’re too expensive for what you get, not because of point of origin. They are merely unpopular, unless one is driven to anthropomorphize their souls and ascribe their embarassment at being assembled so far from home from out of supposedly substandard parts. But major Snoots believe in discrimination for no apparent substantial reason, and no doubt are an important source of new old wives’ tales. Do V90s sell well? They’re only made in Sweden by very white people, but for some reason only available to special order, and we know why – wagons don’t sell well in North America.

    What of Volvos soon to emanate from the new $1 billion factory outside Charlotte SC? Will they be ersatz? Or wonderful because Americans assemble them for a few more bucks an hour than the Chinese, but likely less than than what Europeans get paid? The Snoots will have to monitor developments closely, and issue a definitive statement on the matter in future.

    Mr Baruth is a fine writer, but perhaps he should remember that being a superb word aggregator does not automatically carry with it the ability to reason closely or be an expert on anything in particular. As the quoted statement proves. Indeed, he has become infatuated with himself and now regards his views as some kind of ultimate judgement while operating on false premises. The remainder of the article contains some standard truths and some pull-it-out-of-your-left-ear nonsense, including another swipe at the Chinese for gratuitous purposes, in case the reader skimmed by the first reference and missed the subtlety.

    I sold my last Volvo in 1970, and have not been tempted to acquire one since. I believe Mr Baruth wasn’t even a denizen of the planet at that time, yet now describes hiself as an old codger. Right. Don’t give me the old wise man routine. Please. I trust that all his bespoke tailoring, fine shoes and only the very best watches treat him well. Snoots need that reassurance when they venture to issue their lordly opinions onto the wider world. And at the very least, may his Volvos be no worse than Belgian.

  • avatar
    SaulTigh

    I’m coming round to the notion that luxury means having a car that you paid for in cash and can park anywhere with the doors unlocked and not care if it gets stolen or damaged. I saw a $600 Crown Vic today and was tempted.

    Definitely ready for my BMW lease to be over (11 more months!).

  • avatar
    jc77

    Nicely written article. I agree with most of it, except for one thing: dude, you can’t really put Lexus in the top-tier together with the Germans.
    An important condition for a brand to be called luxury is its global presence: it has to be universally recognized as prestigious. Now, Toyota’s “Luxury EXport United States” line of products has been very successful in the US, but everywhere else, it’s made very little impact. In Europe it’s a dud (they’ve been trying to sell it there for ages, but the very few Lexuses you can see are mostly taxicabs); in Japan it was only introduced in 2013, and is often laughed at; in China it still sells much less than the Germans; even in Canada its market share is inferior as it is south of the border.It takes much more than being successful in one country only (even a large country as the US) to truly build a luxury brand.

    Even among the Germans, you might want to place MB slightly on top of the others. After all, they invented the car itself, and it’s the only company that has constantly built high-quality, true luxury cars through their entire history. Neither BMW nor Audi managed to do that (and I own an Audi myself, so I’m not an MB fanboy :) )

    I’d finally like to say a word about the CLA, which happened to gather a lot of hate in the comments. Granted, it’s not as high-end as a C-class; it’s got a transverse engine and FWD, and it’s pretty small inside. However, from here to say it’s worse than a silly Honda Civic… Come on. I rented both a CLA and a Civic time ago, and I can tell you the CLA is a much, much better car. Quicker, more responsive, more refined, more fun to drive (especially when you compare MB’s dual clutch gearbox to Honda’s tragic CVT – and yes, I did rent a new, 2017 Civic). Again, probably not a true Merc, but still no match for any Japanese car.

  • avatar
    sst

    I think all the information in this op-ed needs to put in perspective. The reference is with respect to the US market. In the global market economy of luxury cars, BMW, Mercedes-Benz and Audi own 80% of the share in that order. If Lexus is only part of the other 20%, where does that leave the rest of the players? In a small part of the market. It still is a stable one though.

    The “fake luxury” market is really the opportunity for people to find luxury where a consumer would not previously afford it. This market is a niche much like the luxury market. To say it is dying is maybe a little short sighted. Instead it might be emerging.


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