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Customer LoginsLuxury makes at the NAIAS: focus on the small car
The Luxury Compact Car Segment - with 27% of all luxury registrations during the first 11 months of 2011 - is the largest luxury segment. Therefore, it is no surprise that many of the luxury marques focused on small cars in their presentations to the media at the recent North American International Auto Show (NAIAS) in Detroit.
BMW unveiled the redesigned 2012 3-Series which offers understated, evolutionary styling changes; later in the year, a hybrid 3-Series will be available. Cadillac introduced the all-new ATS, an incremental model aimed directly at the 3-Series. The ATS offers styling similar to that of its larger CTS cousin, though a bit softer, and it will be available with three powertrains and either RWD or AWD. Over time, the CTS will grow slightly to compete more directly with medium-size luxury cars such as the 5-Series and E-Class. Lincoln revealed the concept version of the re-designed MKZ. If the production version of this car is similar to the concept, the upcoming MKZ will usher in a promising new era in which the small Lincoln model contrasts significantly - at least visually - from its Ford counterpart. This would be a major step forward for Lincoln, as its models in the past have been criticized for being little more than re-badged Fords (or Mercurys).
Acura unveiled the all-new ILX compact luxury sedan. This model, which will also be available as a hybrid (Acura's first), will replace the TSX and be positioned further downstream than the TSX to reduce overlap with the TL. Together the ILX and TL will give Acura a potent combination in the small luxury car segment. Lastly, Volvo revealed the Volvo S60 plug-in hybrid concept, which boasts a projected 100+ MPG. However, the launch of the production version is not imminent.
Mercedes-Benz and Audi did not directly address the small luxury car segment in their press conferences, but they remain major players in this part of the premium space. Mercedes-Benz recently launched the C-Class coupe to compete with the 3-Series two-door, and later this year, Audi will launch a revised version of the A4 in response to the new 3-Series.
With BMW launching an all-new 3-Series, Mercedes-Benz adding a competitive coupe to its C-Class line-up, Acura ready to come back after an off year in part because of inventory shortages, Lincoln re-energized after some off years, and Cadillac eager to establish the ATS as a long-term player, competition for the premium buyer could not be more intense. With leasing accountable for 40%+ of new premium registrations, there will undoubtedly be eye-catching, hard-to-believe lease payment advertising and promotions. If you have been contemplating dipping into the reasonably-priced end of the luxury market, now would be a good time to step up.
Tom Libby, Lead Analyst - North American Forecasting, Polk
Posted 24 January 2013