What is the state of China’s luxury car market? Depending on who you read, it can be up or down.
Yet, most agree that the emerging buyers of luxury cars are wealthy and younger. CNBC says they are young, rich, classy, and they want a car that shows it: the average luxury car buyer in China is around thirty years old, ten years younger than their American counterpart, according to Ralf Speth, CEO of Jaguar Land Rover.
As China’s class of young affluents burgeons, so too does the luxury auto industry there. Over the last ten years, sales have grown 36 percent annually in China. Speth said, “These are people who are young and entrepreneurial and they have the affluence, so they want a car that shows it.”
Audi, BMW, and Mercedes-Benz are the darlings of this market. These three brands are responsible for three out of every four luxury cars sold in China. “It’s not unusual to see a 30-year old driving an S-Class here. In fact, it’s expected,” said Dieter Zetsche. He recently unveiled the brand’s new compact luxury SUV, the GLA Class.
China is now the second-largest luxury car market in the world, selling 1.25 million upscale cars and SUVs last year, compared to 1.7 million in the U.S. By 2016, China will surpass the U.S. to become the number one market.
“The market in California ebbs and flows like any other market in the United States,” said Michael Robinet, IHS Automotive consultant. “But I think China is really looked at and earmarked as the luxury growth market for the next decade.”
By the end of this decade, China is expected to buy 3 million luxury cars annually. At the same time, the U.S. will have sold just 2.25 million.
image credit: jaguar