The world’s rich are holed up in post-pandemic luxury car rush
Paris – The global rebound from the coronavirus pandemic is pushing sales of luxury automakers to never-before-seen levels, as Lamborghini, Ferrari and Rolls-Royce order books erupt with demand from the world’s rich.
Just like regular workers around the world, the richest have reduced their consumption in 2020, with “double-digit” declines in sales by manufacturers of the most coveted cars, says Felipe Munoz of market research firm Jato Dynamics .
But “the customers of these cars were not as exposed as the others” to the financial fallout of the crisis, he adds.
For the rich, “the crux of the problem was that they couldn’t leave their homes,” says Munoz. “They postponed their purchases.”
The rebound in exclusive cars was already underway in the last quarter of 2020, as they recovered their platinum credit cards again, cushioning the blow of the pandemic against mass market manufacturers.
Last year, Volkswagen-owned Lamborghini’s annual sales surpassed their 2019 record of 7,430 vehicles, powered by the Italian automaker’s large SUV Urus which was valued at around € 200,000 (US $ 220,000 in the US).
Closed factories caused Ferrari sales to drop 10% last year to 9,119.
But bosses say the Black-Horse brand now has an “order book at record levels”, fueled by the € 450,000 SF90 Stradale – the manufacturer’s first plug-in hybrid – as well as the windshield-less two-seater monza, supposed to cost around 1.7 million euros.
Ferrari hopes to surpass the 10,000 unit mark next year, when it becomes the last luxury producer to offer an SUV with the “Purosangue”.
‘It’s time to enjoy life’
“The luxury market always has very specific rules and customers,” says Guillaume Crunelle, automotive industry analyst at Deloitte.
“Behavior is much more linked to personal situations, to the evolution of their wealth than to market trends.”
After a year with less consumption, “there is quite a bit of money to spend,” said Torsten Muller-Otvos, CEO of Rolls-Royce.
However, the boss of the BMW subsidiary also sees the consequences of the pandemic in people’s purchasing habits.
“A lot of our customers have said COVID has taught them that life can end easily tomorrow and now is the time to enjoy your life.”
This week, the historic British brand launched a yacht-inspired model, the ‘Boat Tail’, of which it has so far built only three units – and will not reveal the price.
Muller-Otvos says the new car is “much more refined” than its latest custom version, the Sweptail, which cost around $ 13 million.
Go to China
Despite Rolls-Royce’s unique elements, many of the more expensive manufacturers have followed trends such as the unstoppable ride of the SUV – and a shift towards environmentally conscious electrification, points out Deloitte’s Crunelle.
Jato Dynamics ‘analysis showed that sports cars only accounted for 5% of luxury sales last year, while SUVs’ market share surpassed coupes for the first time.
In Britain, Bentley and McLaren laid off thousands of workers at the start of the virus outbreak – only for Bentley which recorded record sales of 11,000 units thanks to the € 200,000 Bentayga SUV.
Rolls-Royce had its best quarter at the start of 2021, powered by its New Ghost Coupe and 2.6-ton Cullinan SUV, € 350,000 – the most expensive on the market.
And James Bond’s favorite Aston Martin has come back from the brink of bankruptcy with its nearly equally bulky DBX.
Looking ahead, “this year’s production is complete,” says Rolls-Royce’s Muller-Otvos.
Europe and North America remain strong markets for luxury brands, but China is where most of the growth is located.
“It’s the number one region in the world for wealth creation, and cars are still a very powerful status mark,” says Crunelle.
Munoz predicts that “with more and more millionaires and billionaires (in China) every year, the trend is expected to continue.”
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