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Customer LoginsLuxury utility share climbs above 50%
New registrations of luxury utilities have passed another milestone: they now account for more than half of all US luxury registrations. Luxury utilities’ share of the luxury vehicle market has climbed more than 13 percentage points in the past five years to 51.3% through seven months in 2016 (see chart below). Much of this increase has been propelled by the compact luxury CUV category (following in the footsteps of the non-luxury CUV segment), where new registrations have skyrocketed 290% since 2011 (versus 47% for overall luxury) and the number of models available has more than tripled from 6 to 19 over the same time period.
The growth of the luxury utility group has been driven by several factors, including the movement of some premium brands into this space for the first time (Bentley, Jaguar, Tesla), the expansion of existing luxury portfolios to target more defined customer clusters (Mercedes X4, X6 andGLE), and the exceptionally high loyalty of utility owners to this body type. In the first seven months of 2016, 67.3% of all luxury utility owners who returned to market acquired another one (either as a replacement or addition to the household fleet), a higher loyalty rate than for any other category and more than 16 percentage points above the runner-up, luxury sedans (50.7%). In other words, more than two thirds of all luxury SUV/CUV owners like their vehicles enough to buy another one.
Lastly, luxury utilities’ share of the luxury market is substantially higher than the comparable metric in the mainstream sector in part because pickups and vans make up a sizable part of the mainstream market but are almost non-existent in the luxury space.
Tom Libby is Manager, Loyalty Solutions and Industry Analysis, IHS Automotive
Posted 19 October 2016