All Things Being Equal: The Changing Face of Luxury

There’s a growing assumption that automobiles have become so universally satisfactory, there’s nothing to gripe about anymore. We’re inclined to disagree. There will always be models that fail to meet our expectations and industry trends we’re not particularly fond of. However, we will happily acknowledge that low-tier automobiles have become decidedly less terrible when thrown together into a pool.

A weird side effect of this has been mainstream brands moving upmarket and offering a bevy of luxury options while extravagant nameplates do the inverse. For example, the Kia Cadenza can easily be outfitted to surpass the base Cadillac ATS in terms of luxury features and overall price. It doesn’t have the prestige, but you’re still buying a larger automobile with a focus on lavishness that can deliver on an exceptionally quiet and comfortable ride.

On the flip side of things, Cadillac is busy prepping its new small crossover for the general market. Priced for a mainstream budget, the XT4 should be a win for General Motors. But it further showcases the amount of overlap happening within the industry right now. Value manufacturers are becoming increasingly willing to move upmarket while luxury brands are trying to burn the money candle at both ends.

Understanding why is easy. GMC’s Denali has proven a golden goose for General Motors. It’s making them a fortune and other manufacturers want to at least have the option to give mainstream buyers the opportunity to purchase trim levels with a higher profit margin. Meanwhile, luxury brands want to open themselves up to new customers without losing their status as a premium automaker.

Automotive News further examined the trend, with help from Kelley Blue Book and Cox Automotive. In a recent survey, the duo found that roughly one-third of “luxury intenders” said they would absolutely consider a non-luxury vehicle if it had the upscale features they wanted. And, with so many value brands going upmarket in their options, they can probably find almost everything they’d desire in a Hyundai Elantra.

“Luxury is being redefined by consumers and automakers,” Cox Automotive analyst Michelle Krebs told Automotive News. “Consumers who are interested in premium or the upper levels of non-luxury, they want luxury-type features, but they want it at a perceived value price with this idea of increased practicality. Clearly, the automakers want to make more money by offering them, but consumers are already thinking of luxury a bit differently.”

Luxury icon Mercedes-Benz moved decidedly downmarket in recent years, expanding its lineup to include more small vehicles that utilize a front-drive architecture. It also began selling them in more places. Just think about the CLA and new A-Class. M-B isn’t alone, either — most premium brands have added a new bottom rung to their ladders of luxury. However, they’re frequently offsetting that by doing the same at the top of the market — consider BMW’s relatively recent addition of the 2 Series and forthcoming 8 Series. While both follow a similar basic recipe and can be had with all manner of niceties, the former starts around $35,000 while the latter will be well into the six-figure range.

This is mimicked by the mainstream brands, though. Using the Kia example once again, we can see that it still offers the Rio at a highly competitive price (about $14,000) with a bevy of desirable options. But it also has the K900, which is starts around $50,000 and has enough kit to give some premium nameplates a serious run for their money.

We suppose the takeaway from the Cox study is that it still pays to shop around, which isn’t exactly groundbreaking news. But, with even basic models offering things like heated seats and advanced driving aids as an option, it makes more sense than ever to look twice at mainstream brands — regardless of what you’re in the market for.

It’ll also be interesting to see how far this trend takes us. We’ve heard stirrings that several luxury brands are still looking at moving further downmarket with their SUV offerings, while mainstream marques are overtly doing the opposite with the option lists and trim lines of their most expensive vehicles. Maybe we’ll soon reach a point where nameplates are meaningless and the only deciding factor is what tech you can afford… or maybe it always feels this way as cars evolve to become universally better.

[Image: Kia]