In most times of economic slowdown, the market for luxury cars stays healthier than the rest of the mass-market, but this year it’s different. Sales in the U.S. luxury-car market fell 30% as a whole last month compared to a year earlier. That’s just about in line with the 31.9% decline for the overall market, and researchers don’t expect it to get any better.
Many automakers rely on the large profit margin of luxury brands to help them stay afloat when sales in mass-market cars decline and they decrease those margins to ultra-thin levels. With the luxury market dropping as well, they’re finding it hard to create the deals and sales consumers expect in the mass-market.
J.D. Power estimates that BMW AG sales will show a decline of more than 20% for November and that sales for Daimler AG’s Mercedes-Benz unit will fall more than 40%. Bentley’s sales fell 62% while Maserati’s declined 29%. And last month, Porsche AG’s sales fell by half from a year earlier.