More Luxury Buyers Ditch the Imports and Pick Up a Truck

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More Luxury Buyers Ditch the Imports and Pick Up a Truck


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Now a new dimension to this trend is emerging: Even upscale buyers who long favored Lexus, Cadillac, Jaguar and the German luxury brands are gravitating to trucks and S.U.V.s. What they are buying are often special-edition, fully loaded models, like Mr. Victorian’s Raptor, that sell for as much as or more than BMW’s flagship 7 Series sedan.

“We are seeing it,” said Tom Libby, an auto industry analyst at the research firm IHS Markit. “There is movement from luxury cars to luxury trucks.”

General Motors’ GMC brand — which sells only trucks and S.U.V.s — accounted for 11.3 percent of domestic sales of models with an average price of $60,000 or more in 2017, according to data from Edmunds.com. Five years earlier, the brand made up a mere 0.1 percent of those sales.

Ford and Chevrolet saw similar but smaller jumps, driven by increasing high-end truck and S.U.V. sales. At the same time, the portion of over-$60,000 sales for luxury brands including Porsche, Mercedes-Benz, Lexus, Jaguar and Cadillac shrank.

Accelerating, and Sometimes Passing

The rapid growth of the luxury truck and sport-utility vehicle segment has substantially increased United States automakers’ share of domestic sales of models with an average price of $60,000 or more.

That is providing a tailwind for the Detroit automakers when overall new-vehicle sales in the United States are slowing. General Motors, Ford and Fiat Chrysler, with its Jeep brand, dominate in trucks and S.U.V.s, and now they’re scrambling to roll out more high-end versions.

It’s a competitive — and crucial — segment. With demand for cars shriveling, the Detroit three and even some foreign manufacturers acknowledge they are now losing money on many of the cars they sell. But a $60,000 truck can generate tens of thousands of dollars in operating profit.

At a recent investor conference, G.M. outlined a plan to produce more of the pricey Denali versions of GMC S.U.V.s and trucks. The company showed data indicating that the Denali line had an average sale price of $56,000 — more than the average price of a BMW, a Mercedes-Benz or an Audi.

“This thing,” G.M.’s president, Dan Ammann, said of the Denali line, “is a money machine.”

The other Detroit carmakers are heading in the same direction.

In October, Ford began making new versions of its eight-passenger Ford Expedition and Lincoln Navigator full-size S.U.V.s, and already has decided to make 25 percent more this year than it originally planned. In January, Navigators sold for an average of $77,000, thanks to strong sales of the top-of-the-line Black Label edition.

Fiat Chrysler is preparing to add more Jeep models, including a pickup and a full-size Grand Wagoneer.

In 2017, S.U.V.s and crossovers made up 41 percent of the market in the United States, up from 30 percent in 2013, according to Autodata. Luxury cars have gone in the opposite direction: They made up 5.4 percent of the market last year, down from 7.5 percent four years earlier.

And the priciest S.U.V.s and trucks are selling fastest. The high-end Lariat, King Ranch and Raptor models make up more than half of all F-150 sales, up from one-third a few years ago. Denali editions account for 29 percent of GMC’s sales, up from 21 percent.

Low gasoline prices are one reason that sales of high-end trucks are rising. Years ago, pickups and big S.U.V.s often traveled only 11 or 12 miles on a gallon of gas. Today, their fuel economy is often double that.

“The complaint that S.U.V.s are horrible on gas is not such a roadblock anymore,” said Mark Scarpelli, owner of two Chevrolet dealerships and a Chrysler-Dodge-Jeep franchise in Illinois.

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Mr. Victorian’s F-150 includes options like an adaptive cruise control system similar to one available in the Audi sedan he also considered buying.

Credit
Brittany Greeson for The New York Times

At the same time, automakers have appointed special-edition S.U.V.s and trucks with the same kinds of advanced technologies and comfort features that consumers once found only in luxury cars. Want an interior trimmed in African mahogany? You can get it in the Black Label Navigator. Want an S.U.V. that accelerates like a Porsche (and isn’t a Porsche)? Try the Jeep Grand Cherokee Trackhawk and its 707-horsepower V8.

Chuck Ducher, a retired school psychologist in Onsted, Mich., just bought an F-150 Lariat with a bevy of options, including heated rear seats. “I can put my mother back there, and she’s in heaven,” he said. “There’s no doubt in my mind this is a luxury vehicle.”

Wes Lutz, owner of a Chrysler-Dodge-Jeep dealership in Jackson, Mich., said he was surprised at the way customers were snapping up the most expensive models on his lot. This month, he had two Trackhawks this month, each with a sticker price of $93,000.

“They won’t be here more than a few weeks,” he said. “It’s incredible. We never used to play in that price range.”

Increasing competition from upmarket S.U.V.s and trucks is adding to the struggles of the luxury makes. Most have long relied on cars for the bulk of their sales, and are suffering now that bigger vehicles are in favor. In 2017, for example, BMW’s sales to individual customers at dealerships in the United States fell more than 5 percent, according data shared among automakers. The decline in BMW’s total sales was less because of a big jump in sales to rental car fleets, a type of customer that luxury brands tended to shun in the past.

Out in Tacoma, Wash., Gary Gilchrist sees the trend just about every week at his GMC dealership.

“We’ve been taking in Lexuses on trade-ins, BMWs,” he said. This month, he said, a customer turned in a 2012 BMW 550i and bought a $71,000 GMC Sierra Denali pickup.

“People used to want German cars for the image factor,” Mr. Gilchrist said. “Now, if you have a Denali, you get that. People turn their heads to look.”

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