According to a report from the Wall Street Journal,for Chinese car buyers, luxury means Audi AG, BMW AG, and Daimler AG's Mercedes-Benz combined, hold more than 70% of the country's about $40 billion annual market for high-end vehicles.
Now, a club of smaller scale luxury brands have China in their cross hairs. In the past yearGeneralMotors Co. 's Cadillac, Tata Motors Ltd. 's Jaguar Land Rover, and Chinese-owned Swedish brand Volvo have detailed plans to spend billions of dollars on factories in China that would bring at least half a million additional luxury cars to the market beginning 2015.
Now, a club of smaller scale luxury brands have China in their cross hairs. In the past yearGeneralMotors Co. 's Cadillac, Tata Motors Ltd. 's Jaguar Land Rover, and Chinese-owned Swedish brand Volvo have detailed plans to spend billions of dollars on factories in China that would bring at least half a million additional luxury cars to the market beginning 2015.
The competition will heat up again at an auto show that begins in this southern Chinese boomtown on Thursday, where new luxury-car launches include JLR's Range Rover LWB and its 2014 Range Rover Evoque; Volvo Car Corp.'s new longwheel base sedan the S60L; ToyotaMotor Corp.'s Lexus will hold the world premiere of its 2014 CT 200h full hybrid hatchback compact luxury sedan; GM's China debut of its Cadillac ATS small sedan; and Nissan Co. 's Infiniti unveils its Q50 2.0T engine model.
Analysts forecast China's luxury car market will total 1.4 million vehicles in 2013. Using a broad definition of luxury cars, they estimate Chinese consumers' luxury-car purchases could reach three million vehicles by 2020—putting it ahead of the U.S. with its estimated 2.3 million luxury vehicles.
While Chinese desire for German luxury brands is strong, industry experts say loyalty to a single brand is relatively low, providing an opening for newcomers. Chinese consumers penchant for upgrading also means buyers are frequently considering their next purchase. Some also are buying second or third cars for their households.
