Although Luxury cars account for less than 10% of total car sales in the US, it can be argued that almost everyone who owns cars aspires to upgrade to a luxury car sooner or later. So why do people flock to luxury cars despite the high price and depreciation? Let’s break down some considerations for why people buy luxury cars and the psychology behind them.
While luxury cars are usually considered to be very expensive, if you shop around in the used car market, you can find plenty of used luxury cars for sale because of the high depreciation hit on luxury brands for their complexity and high maintenance costs.
They are seen as a status symbol
In many ways, owning a luxury car is seen as a status symbol, a clear way to convey your success to the world. Similarly, it will also reflect the image of a company if they provide luxury cars to their employees, indirectly conveying their success to the world. A luxury car will also give the owners priority in many situations since people relate it to wealth.
Because of the high costs, most people go the luxury route for improving social status instead of necessity. Similarly, luxury car manufacturers also need to keep their image and convey luxury to prospective customers. In many cases, luxury companies like Acura, Lexus, Cadillac, etc sell spruced-up versions of their regular cars and charge extra just for the brand image.
A recent study also found that a lot of customers buy luxury cars because of mid-life crisis, a feeling that they’re missing out in life.
Luxury cars also bring exclusivity into the mix, as sales are limited. Luxury car owners are usually associated with the car that they drive, giving them fame and recognition in their locality. Limited sales of a particular model will also add to the value and drive up desirability. To keep up their brand image, luxury car manufacturers will also shell out a lot more for auto shows and the like.
Build quality and features
While luxury cars are generally seen as a status symbol, you do get a lot more for your money compared to regular models. In general, luxury cars get a lot more modern features that are just not available with other cars. A lot of features we take for granted nowadays like navigation, keyless entry, and more debuted with luxury cars.
Build quality will also be miles ahead compared to regular cars since manufacturers can use high-quality materials and better features. Luxury cars also get more advanced infotainment systems with premium audio and all the latest features.
On the higher end of the spectrum, manufacturers like Rolls-Royce and Bentley go all out in terms of comfort and luxury, and plenty of customers are willing to pay extra for all that luxury.
In general, if you want the best car money can buy, it’s undeniably a luxury car.
The luxury car market is also a lot more competitive, with a lot of manufacturers trying to one-up each other by bringing out more features, and improving wherever they can. Some brands like BMW also prioritize the driving experience, while others like Volvo focus on comfort and safety.
Safety and technology
Many features we take for granted nowadays like electronic stability control, anti-lock brakes, and a lot more were initially introduced in luxury cars before they were available with regular models. Because of the higher price, manufacturers always include the latest and greatest safety technology with luxury cars.
According to Consumer Reports, cars with a base price of more than 44% of models costing more than $30,000 are chosen as ‘Top Safety Picks’ by the IIHS. No matter which model you pick, a luxury car will be loaded with technology and driver assistance features, providing a lot more protection and safety for the occupants. Unlike regular models, a lot of driver assistance technology will be available as standard on luxury cars.
Luxury cars also offer higher performance in general, with almost all models producing upwards of 300 hp. Not only performance, but luxury cars are also a lot more refined than usual with plenty of sound insulation to keep the passengers disconnected from the outside world. A lot of luxury car buyers also consider performance as a top priority, particularly with performance-focused luxury cars like the BMW M series and Mercedes-AMG. The extra performance also increases desirability for a luxury car.
Another aspect that luxury car owners consider is ride quality and dynamics. Unlike the rudimentary suspension setups in most regular cars, luxury cars, especially the ones with higher performance are equipped with more advanced multi-link setups and in some cases, air suspension to provide excellent comfort without compromising dynamics.
The extra performance and advanced suspension setups also make luxury cars a lot more fun and engaging to drive, making them a lot more desirable to car enthusiasts who’re looking for the best that money can buy.
Car enthusiasts also make up a large part of the target audience because of their passion for cars, and luxury cars will provide exactly that with no compromises. In modern times, there are plenty of high-performance models to choose from, regardless of body type and size.
Better consumer experience
Along with the exclusivity and performance, luxury cars are also appealing because of the superior consumer experience compared to regular models. The whole experience from buying to ownership to servicing will all be a notch higher than normal. Most luxury car owners get top priority and will get a better dealership experience reflecting the price point.
Servicing will also be a better experience as the customer will get a personalized experience with plenty of other benefits.
The superior customer experience carries over even if you consider a used model.
Overall, while luxury cars might seem like a bad investment at first, a lot of customers take the plunge for the superior experience on offer. With a lot more exclusivity than regular models and a superior experience right from the showroom floor to the dealership services, luxury cars justify the expense for most customers. These are some of the main reasons why luxury car buyers spend extra.
A professional writer with over a decade of incessant writing skills. Her topics of interest and expertise range from psychology, to all sorts of disciplines such as science and news.