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Future of the Global Luxury Vehicle Market

  • June 2014
  • -
  • Frost & Sullivan
  • -
  • 180 pages

Brand Differentiation and Competitive Pressures to Revolutionize the Luxury Vehicle Market by 2020

The aim of this research service is to provide a strategic overview of the global luxury vehicle market. Luxury automotive OEMs must evolve and adapt to emerging Mega Trends of urbanization, demographic and social preference changes, and technology and electric mobility. The study introduces new market segments that have developed to meet changing customer needs, and discusses automotive Mega Trends and their impact on this market. In addition, it highlights the key technology trends and important launches expected and also analyzes branding and new market channel strategies adopted by luxury OEMs.

Executive Summary—Key Findings

Growth of luxury vehicle sales is set to outpace growth of the mass-market vehicle sales, with luxury expected to account for 10% of the global automotive market by 2020.
1 In an increasingly competitive space, OEMs are exploring new means of differentiating their brand, and the study finds that new brand attributes and positioning will propel the market.
2 To expand market share and improve profitability, traditional mass-market brands (e.g., Hyundai, Ford, and Fiat) are attempting to expand their portfolio with the launch of premium models, such as the Genesis, the C6, Avantime, and Ford’s upcoming Vignale brand. Chinese brands are to follow.
3 Size is no longer one of the key definitions of a luxury vehicle. There is a growing market for smaller, fuel-efficient luxury cars. The compact segment is expected to be one of the fastest-growing luxury car segments, growing by % to reach close to million sales globally by 2020.
-To build sustained brand loyalty, luxury OEMs are targeting Gen X and Y with more compact, sustainable, high-tech cars; for example, Mercedes CLA, Audi A3, BMW 1 series.
-The premium suburban utility vehicle (SUV) and crossover market is one of the hottest segments, accounting for approximately % of global luxury sales.
4 Connectivity and autonomous driving are evolving into key parameters by which a brand will be judged in the future. The race is on to launch the first fully automated car, which is expected to hit the market by
5 The advent of eRetailling and digital technology has spurred the evolution of market channel strategy of luxury OEMs from the traditional brick-and-mortar showroom to a more sophisticated, digitally enhanced brand experience.
6 In 2013, China overtook the United States to become the largest market for luxury vehicles. By , China’s share of the global market is expected to grow to nearly %.

Table Of Contents

Future of the Global Luxury Vehicle Market
1. EXECUTIVE SUMMARY

Executive Summary—Key Findings
Key Mega Trends that will Impact the Luxury Vehicle Market
Luxury OEM Types of the Future
How Luxury Cars will be Defined in the Future
How OEMs will Differentiate their Brand in the Future
Branding Comparative Analysis of the Luxury Brand Values
Attractive Attributes for the Future Luxury Customers
Future Luxury Customers
The Smart Future Retail Network
Key Components of the 2020 Luxury Automotive Store
Future Omni Channel Retail Stores To Be More Experience-based Than Transactional
Increasing Investment in Data Mining and Data Analytics
Luxury Vehicles—Future Differentiating Technologies
Connected Car Feature Portfolio of Luxury OEMs
OEM Comparative Analysis—Automated Driving Rollout Strategy

2. RESEARCH SCOPE, OBJECTIVES, BACKGROUND, AND METHODOLOGY

Research Scope
Research Aims and Objectives
Key Questions This Study Will Answer
Research Background
Research Methodology
Key Global OEMs—Luxury Brand Portfolio

3. DEFINITIONS AND SEGMENTATION

Vehicle Segment Definitions

4. MEGA TRENDS DRIVING THE LUXURY VEHICLE MARKET: TRENDS ANALYSIS—CURRENT TO 2020

Definition of Mega Trends and Top Mega Trends that Frost and Sullivan Tracks
Key Mega Trends That Will Impact the Luxury Vehicle Market
Urbanization
Growth of the HNWI—Top 30 Cities by HNWI Population
Health, Wellness, and Well-being
Smart Mobility
Connected Luxury Car—An Extension of Connected Living
Big Data Deluge

5. BRAND POSITIONING WITHIN LUXURY MARKET—THE ROAD FORWARD TO 2020

How OEMs Will Differentiate Their Brand in the Future
Future Brand Differentiation
Branding Comparative Analysis of the Luxury Brand Values
Attractive Attributes for the Future Luxury Customers
Analysis of Attributes to Derive the OEM Brand Values
How Luxury Cars Will be Defined in the Future
Top 3 Luxury Automakers Brand Positioning

6. GLOBAL LUXURY MARKET—MARKET FORECASTS AND SEGMENT ANALYSIS: COMPETITIVE ANALYSIS

Evolution of a New Competitive Structure in the Luxury Vehicle Market
Premium Industry Market Segmentation
Luxury OEM Types of the Future
Price vs. Segment Analysis in the Luxury Vehicle Market
Comparative Analysis—Vehicle Length vs. Average MSRP ($)
High-performance Variants:

7. GLOBAL LUXURY MARKET—MARKET FORECASTS AND SEGMENT ANALYSIS: GEOGRAPHIC AND SEGMENT ANALYSIS

Global Luxury Vehicle Market 2013
Key OEMs Strategies for the Luxury Car Market
Global Luxury Vehicle Sales by OEM: 2013 to 2020—A Snapshot
Top 5 Markets by Sales in 2013
Global Luxury Vehicle Sales by Region in 2013—A Snapshot
Key Regional Market—BRIC vs. G5 and United States
Key Regional Markets—Developed vs. Emerging Economies
Luxury Vehicle Market by Product Segment
Small and Midsize Segments
Luxury SUV-crossover Segment
Luxury Vehicle Market in China
Luxury Vehicle Market in Europe
European Luxury Vehicle Sales by Key Countries—G5 vs. E5
Luxury Vehicle Market in Europe
Evolution of Body Styles in the Luxury Vehicle Market
Key Model Launches 2012-2013
Key Model Launches 2014-2020

8. DEMOGRAPHIC ANALYSIS OF THE FUTURE LUXURY CUSTOMER: KEY CUSTOMER SEGMENTS

Future Luxury Customers
The Global Baby Boom
Target Demographic for Luxury OEMs-US Market
Baby Boomers and Millennials To Continue Dominating the European Population Till 2020
Baby Boomers Keep Auto Sales Booming; Millennials—the Next Target
Female Empowerment
Women and the Car Industry
What Women (Do Not) Want

9. DEMOGRAPHIC ANALYSIS OF THE FUTURE LUXURY CUSTOMER: TARGET SUB-SEGMENT CUSTOMER PROFILES

Target Customer—Status Seeker
Target Customer—Suburban Achievers
Target Customer—Practical Luxury
Target Customer—High Net Worth Individuals

10. DEMOGRAPHIC ANALYSIS OF THE FUTURE LUXURY CUSTOMER: EUROPEAN LUXURY CAR MARKET TREND ANALYSIS(CUSTOMER RESEARCH RESULTS)

Customer Research Analysis Introduction
Gender Comparison
Age Comparison
Comparison of 18- to 35-year-olds
Luxury Car Brands Comparison
Audi and Mercedes Trend Comparison
Luxury Car Brands Comparison by Gender
Key Criteria for the Next Purchase—Female
Key Criteria for the Next Purchase—Gap Analysis
Generation Y General Attitudes
Generation Y Attitudes Toward Personalization
Key Conclusions From the Luxury Customer Trend Analysis

11. KEY TECHNOLOGY TRENDS IMPACTING THE LUXURY VEHICLE MARKET: POWERTRAIN

Key Powertrain and Electric Vehicle Trends Affecting the Luxury Vehicle Market
Transmission Strategy
Brand Positioning and Strategy
Premium Electric Vehicle Launches by German OEMs—2014
Comparison of Premium Electric Vehicles
PHEV and eREV Model Launch Roadmap of Key OEMs—Europe and NA
BEV Model Launch Roadmap of Key OEMs—Europe and North America
Case Study of the Leasing Model—Cadillac ELR's Lease Plan (Limited to Current GM Owners and Lessees)
Case Study of the Leasing Model—The Tesla Model S Financing Plan With Guaranteed Resale Value

12. KEY TECHNOLOGY TRENDS IMPACTING THE LUXURY VEHICLE MARKET: CONNECTIVITY

Connected Car Feature Portfolio of Luxury OEMs
Luxury OEMs Communication Strategy
Luxury OEMs' Connected Car Business Models
How Big Data can Help Luxury OEMs
Role of Smartphone in Luxury Infotainment Market
BMW Case Study
BMW Case onnected App and BMW Link
Audi Connect Case Study
Mercedes Benz App Shop and Digital Drivestyle App

13. KEY TECHNOLOGY TRENDS IMPACTING THE LUXURY VEHICLE MARKET: AUTONOMOUS DRIVING

Automated Vehicles Forecast for Europe
OEM Comparative Analysis—Automated Driving Rollout Strategy
OEM Comparative Analysis—Automated Driving Application Strategy
Case Study—Cadillac Super Cruise
OEM Comparative Analysis—Automated Driving Cost and Packaging
OEM Comparative Analysis—Automated Driving Cost and Packaging
Autonomous Driving to be Another Key Parameter on Which Luxury OEMs Compete in the Future

14. KEY ATTRIBUTES IMPACTING THE LUXURY VEHICLE MARKET: FUTURE VEHICLE ATTRIBUTES

Luxury OEMs—Technology Evaluation Process
Technology Evaluation Process
Luxury OEMs Choosing Key Brand Attributes to Identify and Differentiate them from their Competitors in the Consumer's Mind
Emphasis on Differentiation

15. CHANGING FACE OF MOBILITY AND ITS IMPACT ON THE LUXURY AUTOMOTIVE MARKET

Paradigm Shift from Vehicle Ownership to Vehicle Usage
Presence of 3 Emerging Business Models Within Mobility Integration
Mobility Integration Case Study—Qixxit, Germany
Case Card aMobility Service Offerings
Case Study—Mobility Service Ecosystem of BMW
Case Study—Daimler Mobility Services mbh
OEM Car Sharing—Daimler Expected to Generate €100 Million from Mobility Services in 2014 and Aims for €1 Billion by 2020
Daimler Mobility Contribution to Overall Revenue by 2025
Luxury OEMs Regional Mobility Products and Services
Outlook for Global Car Sharing 2020
Corporate Car Sharing
Automotive OEMs—With Luxury OEMs Leading—to Integrate Parking as Part of Their Mobility Offering
New Car License Quota, China
Venture Capital
New Mobility Business Models Changing the Landscape for Luxury OEMs

16. THE FUTURE OF LUXURY AUTOMOTIVE RETAILING

Mega Trends Driving The Future of Retailing
Key Components of the 2020 Luxury Automotive Store
More Interactive and Seamless Than Siloed
Future Omni Channel Retail Stores to be More Experience-based than Transactional
Digital Retailing Formats of Luxury OEMs
More Consultative Than Directive
The Business Card of the Future—Your Unique
Increasing Investment in Data Mining and Data Analytics
The Luxury Showroom of the Future: Unlimited, Personalized, Digitally Integrated, Socially Connected
Case Study—Audi City Digital Car Showroom
Structure of a Future Channel Network in a Mega City
The Smart Distribution Network
Off-store Digital Sales Generation: The Online Channel Graduating from Marketing to Sales Tool
Key Takeaways on the Future of Luxury Automotive Retailing

17. CONCLUSIONS AND FUTURE OUTLOOK

Key Conclusions and Future Outlook
The Last Word—3 Big Predictions
Legal Disclaimer

18. APPENDIX

Abbreviations and Acronyms Used
Learn More—Next Steps
Related Research
Related Research
Market Engineering Methodology
Key Value Parameters by Top 5 Luxury OEMs

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