That's defining the U.S. luxury car market very narrowly. BMW alone sold 172,000 cars in the U.S. in the first half of this year[1]. 8% of that is more than 13,000 cars, and the report is claiming Tesla sales of roughly 10,000.
Sure, not everything BMW sells is a luxury car, but the U.S. luxury car market is usually defined as much larger than 125,000 cars in a half year.
Fact of the matter is any company is mostly judged based on the market they have chosen to compete in. Tesla make $70K+ cars and they should be judged based on that market.
Porsche (before they were purchased by VW) used to make rather expensive cars and they would always have a rather small percentage of the overall market. But no-one would accuse Porsche of being a failure, because they did very well in their rather lucrative price brackets. In fact Porsche is often called the most successful car company ever due to their big profit margins.
What I mean is that I am using Porsche as an example only as it pertains to its history of an independent company. I wanted to provide an example of an independent company that is limited to making expensive cars -- i.e., something similar to Tesla.
Car classes like 'luxury', 'midrange' and 'economy' are very loosely defined, and deliberately so. There's no point arguing over what a luxury car is, as many groups will have different answers.
Car companies love this, after all how many times do you see something like "The best [insert feature here] in its class" in their marketing? Because there are so many different definitions of car classes, no-one can prove their statement wrong!
I have to disagree with you; the A8, S, and 7er are "large luxury" class cars. The A6 and 5er are "midsize luxury" and the A4 / 3 are "entry luxury." One should also consider the Lexus LS, GS, GX, and LX, an occasional Cadillac, the Toyota Land Cruiser, a variety of Jaguars and Range Rovers, and on and on. It's dishonest to assert that Tesla is taking 8.4% of the entire "luxury market" and then sneak in with the next breath that the luxury market includes only flagship sedans.
Am I understanding correctly? You are putting audi A4/3($27K MSRP) into the same class as Jaguar(starts at $47K) and Range Rovers ($83K MSRP)? I think Tesla with it's price tag should go into a separate category from audi a4,3...
Yes, the US taxonomy includes a great swath of vehicles in the "luxury" main category, even though many of them are not directly comparable. For example, the US market would consider the Audi A3/A4 to be the luxury versions of the VW Rabbit/GTI and Passat, and generally the trim levels available in the US reinforce this: it is very unusual to see in the States any Audi with cloth seats, but not uncommon in Europe.
Hardly any Americans would place a BMW 550i in the "non-luxury" group, least of all BMW USA. It isn't the largest or most feature-jammed car in the fleet, but to Americans it is absolutely a luxury car.
This is largely due to the manufacturers. "Americans" don't decide that a 5-series is luxury, it's the manufacturers. You can't buy a BMW or Mercedes without all of the bells an whistles. You can't even buy many of the cheaper cars (i.e. A-Class) from those manufacturers in the US.
I would put the RS versions of the 5 & 6 in luxury and probably all the RS sort of qualify as would some of the S models (not the S Line thats just trim)
If you call A6 and 5-series luxury cars then half of Germany / northern Europe are driving luxury cars, that is by definition not luxury. Those are called "upper midrange" or "premium".
I'd like to join in on this game. How about this for an idea:
I disagree with both of you. Your categories are all are artificial and for people with "new money". It's a concern for those who seek to differentiate themselves from the rest the middle class by burning cash on these silly toys. Those with true wealth find this mundane and even distasteful.
Given what the original report actually says, your answer might be a tad bit more lame-brained than the person you are responding to.
"PEV[1] sales, while not matching up with original sales targets laid out by some auto manufacturers, have been strong for a new entrant in a market that has been dominated by internal combustion engine vehicles (ICEs) for a century. Through their first 30 months in the marketplace (2011-2013), sales of PEVs have been more than double the sales of hybrid electric vehicles (HEVs) in their first years in the U.S. market (2000-2002) and the sales continue to grow—June 2013 saw the strongest PEV sales numbers yet, and more than 110,000 units have been sold to date. In the luxury segment, Tesla’s Model S has captured 8.4 percent of the market in the first six months of 2013."
So, the 8.4% is actually not "luxury" class cars at all. It is a subset.
In that case the Tesla isnt a luxury car either because it competes with the likes of 5 and 6 Series BMW and Audi A5/A6. It clearly is not an A8, 7 series or S Class rival.
Only the 7-series is unambiguously luxury. Which aligns with my European view that a 3-series is your bog standard "large family car" or "small executive car".
> BMWs. They're all luxury cars, from what I can tell.
BMW 5 series are the most-purchased company cars here in Austria, they certainly aren't luxury cars anywhere outside the 3rd world, although they might enjoy a certain brand image in the US ...
The difference is that in the US, neither BMW nor M-B market stripper versions of their cars. In order to buy a 5 series or E Class you will end up with at least a 528 (with significant number of interior luxury features) or an E350. Both of them start at about US$50k, and to me that is squarely luxury. Interestingly, well over half of all of them are leased, not purchased.
The way things are defined in the US, the BMW 5 series is a luxury car. It represents close to the maximum amount of amenities for a given size class and, well, the car magazines call it a luxury car. There's not much else to it...
It's certainly possible they're equipped differently here, as so many cars are. If that's not the case and Austrians simply have a different sense of "luxury car" I wonder what you guys have that trumps the 5 series in that size category, as far as "luxury" is concerned.
I bet there is an objective criteria for it, though (if not a very clear one).
A thought-experiment: say you wreck your car, and your insurance provider is going to give you a loaner.
They want this loaner car to impress you (the cost of one regular car, however nice, is not much skin off their back, especially if they get to amortize it over all the people they lend it out to; and they want to give you the impression that they've got enough money to cover any problem you might have, so that you'll keep paying your premiums--the same reason bank lobbies look so "stately.")
However, they don't want to spend too much, because there's a point where cars switch from regular goods, to being Veblen goods. (http://en.wikipedia.org/wiki/Veblen_good)
The optimum between impressing you the most, and avoiding spending way more than the car "should" be worth for an any marginal gain of impressiveness, should define the type of car they loan out (and it does, in my experience.) You can draw the "luxury" inflection point as being exactly the next-most-expensive models up from these, where the value proposition stops making sense to economically-rational actors.
I agree. They use a pretty bad (i.e. unreasonable) definition of luxury car market.
I live in Manhattan (so maybe Tesla is not big here), but in the last year I've only seen 2 Teslas on the road. By comparison, I see about 5-10 Audi A8's a day.
i haven't seen a good answer from tesla for apartment dwellers, or rented parking spaces. both of which are more endemic in NYC. to own your own property and own the parking spot so that you could install a charger is a lot.
Sure, not everything BMW sells is a luxury car, but the U.S. luxury car market is usually defined as much larger than 125,000 cars in a half year.
[1] http://www.theguardian.com/business/2013/jul/08/bmw-record-c...