Downmarketing of luxary car lines

Interesting article here about car makers selling cheaper cars in their luxary lines.

One of the better lines is at the bottom. It relates to the cheapest Cadillacs being sold:

"As GM Marketing Guru Mark LeNeve said, "A Cadillac is something a kid should aspire to. Not something he should be able to own.""

 

Hi Chowsie, remember how the 914 and then 924 almost killed Porsche?

 

Yep,

914-4 = VW.
914-6 = Porsche
924 =

I think the guy has a point. Things easily gained have little value. A Cadillac or any luxary car should be something you earn in time. Something for a kid to aspire too and the Cimarron (or whatever its called) didn't exactly last the test of time

Here is a GREAT commercial that is the epitomy of that statement http://youtube.com/watch?v=ZFWQWf5DD74

Here is a great commercial with Dr. Ferry P
http://www.youtube.com/watch?v=iuavMB1_vlQ

 

when a 3 series BMW that I'd actually want to own is over $40k, they better have something to get younger folks into the fold. But then again, what's so special about a brand that any person can buy? It seems the execution of the entry level cars is what makes them a success or a failure. But what can they do? Hope that more and more people will want to buy their entry level $50k car? By then, the brand relationship has already been made with another car.

Matt

 

I think here is the key point

"Today, you can buy a Cadillac for $32,500 (CTS), a Jaguar for $34,995 (X-Type 3.0), a Lincoln for $29,305 (MKZ) and a Saab for $26,995 (9-3). That's before discounts. Discounts that reflect the fact that these formerly upmarket brands have squandered their allure ... For these former luxury car playas, moving into the mass market signaled the beginning of the end."

Since the Average car sold in the US is now $28K, $50K for an entry level luxary car is probably right. Selling the entry level car for $30K just screams its "average" and hence, a loss of prestige ... as the article says ... the beginning of the end.

What to do? If the marque is truly upscale, it won't matter if brand loyalty exists. A savvy buyer will go where the quality is. But the masses ... yes, "my father bought a ford, so I'm buying a Ford" and that will never change

 

Fun commercials . . . good stuff.

 

If only they would bring over a 135i four door, I'd buy. 300+ hp from the factory and easy access to the backseat for a carseat would be nice. I'd love a 535xi Touring, but <cough> $60K is more than I care to spend for a car.

 

I hope that's for the high end Saab.

I have just never gotten past seeing Saabs as eggs powered by 3 cylinder engines. At the time, I think they were only offered in lemon yellow.


I know I have issues: I'll have to see a therapist about this. NOT!

 

chows: I thought you were unveiling a new Chinese luxury knockoff, something Lexus and Pixar would do.

Anyone remember what a stripper was? No, not the working girl! Bugs me that every car has to have so many features.

Even if I could afford it, I wouldn't want some of these luxo-barges with all the computer junk to play with.

 

Absolutely. I used to have a Toyota Tercel with plastic floors. Total stripper. IMO, the sad thing about MINIs is that a $22K car ends up selling for $35K because of all the options people had when a stripped MINI is perfectly fine

 

i remember my pop's old maxima was faster than the 308.

 

Aspiring to own a caddillac interesting coming from the people who brought us this POS.

 

oh my...

 

we had one of those lovely cars for a bit. And while it wasn't a great handling car, nor had the ride of a bigger caddy, all the fancy little convinience featrues were there. It was kind of nice, as we only had it for the first three months of it's lifetime.....

But it surely proved that you needed to do more than just an interior to do successful platform sharing....

Matt

 

we owned an '81 Buick Skylark...that Caddy's poorer cousin. Motor blew up at 85k miles which was all too typical for the GM aluminum four bangers.

 

One issue that I see is that the 'entry car' keeps on getting bigger.

Park a 2k7 3-series next to one from 20 years ago (e30) and it is massive - not only is it several feet longer, it is about a foot wider and massively heavier.

Try it with a Golf (GTI), the current one is the size of a luxo-barge next to the original.

So, the entry level keeps getting bigger and bigger and the ticket gets more and more expensive.

The only solution is to introduce a new entry-level at some point.

VW did it with the Polo - ironic that this is now bigger than the original Golf and the Lupo is now the 'new' entry in europe.

Ford did it with the Fiesta - again the Ka is now the start point and about the same size as the original Fiesta, which is about the same size as the Escort was - this is replaced by the Focus, but same idea

......and so it goes on - Audi have the A3 (and in Europe the A1) that is comparable to the size of the old A4, which is way bigger than the 80-series and the 100 series and approaching 200-series size - which was a barge in its day, only outdone by the 5000 series, which is small compared to the A6....

Does it distil the brand ?

Not really, it gives a new entry point to 'join the club' to replace the previous entry point which is now humungous..

 

I agree I think the stripped MCS even has a little to much electronic gizmoes for me. Give me air and a CD player and I'm happy,the more stuff you have the more that can break.

 

the '89 Accord we bought for $17500 is the same size and cost as the '07 Civic. Go figure.

 

I dont think its only entry vehicles.

Move up in the BMW line and 5 Series bigger than 3 Series ... 7 Series bigger than 5 Series ... but within the lines, they all seem to get bigger and heavier.

Even the MINI got bigger. In fact, try to find one car model that has gotten smaller. I think you may be hard pressed to find any car that has remained the same size as earlier generations. The one I can think of ... MR2. Originally 154", last edition 153". Try to find another

 

Exactly - have you seen the Cayman parked next to a mid 70's 911 ? They are extremely similar - while the latest 911 is way bigger.

The Last MR2 was a 'back to basics' approach that was extremely rare.

I await the New Mini Nano in about ten years, this will be the same size as R50, while then current model will seat 6 and weigh about eleven tons....

 

Yes, 911s have grown 7 inches from mid-70s to today. This a complaint of some people, that the 911, although iconic, has become bloated and turned from a sportscar to a GT (except of the GT3). Nothing wrong with being a GT, just not the same thing as a sportscar. This has been a factor for some people in the buying decision of a Cayman vs a 997.

 

I think having an entry-level, affordable model for luxury brands is fine IF as the article aluded to, it is a good product. When a company slaps its badge on a POS (ie. X-Type, Mercedes C230) that's when it becomes a problem. In the modern corporate world, profits are king. Corporations are driven by the expectations put on them by stockholders to continue to grow the brand, and increase profits and dividends. Therefore, many manufacturers that previously operated in a niche luxury market are expanding their lineups. For example, BMW is no longer the low volume manufacturer it once was. The goal is to get customers to buy into the brand at a young age with the hope of retaining them for life.

As I said before, the problem that some manufacturers have run into is when, in an attempt to rush an affordable model to the market, they end up diluting the brand with a car that is inconsistent with the attributes that make a car from that brand desirable in the first place. From my observations, some of the recently introduced entry level models from Volvo (C30), BMW (1 Series), and Audi (A3) have shown that some of these companies understand this concept. Volvo took a very careful approach in deciding how it would market the C30, especially in the US where Volvo is considered more of a luxury brand than in Europe. They did not want the C30 to merely be seen as a "cheap" Volvo, so they elected to only bring the turbo charged version to the US. BMW took similar measures in deciding which engines and body styles of the 1 Series to sell here (I believe they passed on selling the hatchback 1 Series because hatchbacks still have the stigma of being associated with the econo boxes of the 70s and 80s). While many luxury manufacturers are selling lower priced models, I don't think it will hurt the brand if they are still selling great products. But if they are merely dumbed down, cheapened versions of more expensive models, then the brand will become diluted.

I think it is also important to note that in many cases, even these "cheap" luxury cars are still expensive compared to their "lower end" counterparts. So in reality, people still won't be cross shopping Honda Civics with BMW 1Series (forgive me if that is a bad example but hopefully you get the point).