An exclusive new study led by Boston Consulting Group with duPont REGISTRY Group projects that the U.S. luxury and exotic automotive sector will grow from approximately $110 billion today to as much as $215 billion by 2035, underscoring the category’s rising influence within an increasingly interconnected luxury-lifestyle ecosystem.
According to the report, the U.S. total addressable market for vehicles priced at or above $100,000 is projected to rise by a compound annual growth rate of 5% to 7% through 2035 – reaching a market value of between $180 billion and $215 billion. Sales of used vehicles are projected to grow up to 1.5 times faster than those of new ones thanks to high new automobile prices and an ever-growing supply of secondary market inventory.
While buyers remain enthusiastic about luxury and exotic automobiles, preferences are changing across the customer journey, according to the report. Players, including brands, dealers, and marketplaces, will need to adapt to these changing preferences to secure their market position and capture future growth.
By interviewing leading stakeholders and surveying over 400 current and prior collectors and prospective buyers, the report’s authors found that, while buyers remain enthusiastic about purchasing a luxury or exotic automobile, preferences are changing across the customer journey:
· For most respondents, shopping was a near-constant activity. About 80% of buyers browsed the internet at least weekly even when they didn’t have an immediate intention to buy. Once they had decided, however, around 70% of respondents completed their purchase within a month.
· While a large proportion of buyers across all age groups favored a couple of anchor brands (notably Porsche and Ferrari), millennials and Gen Z respondents were more willing to cross-shop and consider other brand options.
· Across all age groups, one-third of buyers cited emotion-based factors as the primary reason for purchasing a vehicle. However, younger buyers were more likely to view a luxury automobile as an investment opportunity or as a reward, while older buyers were attracted by technological innovation and owning the latest model.
· Although purchasing through an authorized dealer was the most popular option across all age groups, millennials and Gen Z were more likely to buy from digital platforms or through private sales. Significantly, the survey found a high degree of digital comfort among all generations, with three-quarters of respondents open to buying their next vehicle entirely online.
· The vast majority of buyers considered experiences to be a valuable part of their brand satisfaction. While driving-related or vehicle-related programs such as track events and factory tours came out on top, lifestyle-based events such as wine tastings or fashion shows were also popular, suggesting an emerging opportunity to develop the luxury automobile experience beyond the vehicle.
The report’s findings indicate that ecosystem players can’t rely on traditional approaches to captivate and capture an evolving customer base.
To keep pace with the changes underway in the luxury and exotic automobile market, they should prioritize the following actions over the next few years: deliver regular, engaging online content that matches buyers’ growing digital sophistication; build emotional loyalty around brand; evolve e-retail models; double down on experiences.
About duPont REGISTRY Group
The heart of the Driven Lifestyle division, the duPont REGISTRY Group is the world’s leading luxury ecosystem, encapsulating the culture, community and commerce of the high-end automotive lifestyle. Built by some of the biggest names in the luxury automotive space, duPont REGISTRY Group represents a vibrant community of members worldwide nurtured over four decades. Its portfolio includes duPont Registry, Canossa Events, Cavallino, Supercar Owners Circle, Petrolicious, Retromobile USA, FerrariChat and Sotheby’s Motorsport.
About Boston Consulting Group
Boston Consulting Group partners with leaders in business and society to tackle their most important challenges and capture their greatest opportunities. BCG was the pioneer in business strategy when it was founded in 1963. Today, we work closely with clients to embrace a transformational approach aimed at benefiting all stakeholders – empowering organizations to grow, build sustainable competitive advantage, and drive positive societal impact.
Our diverse, global teams bring deep industry and functional expertise and a range of perspectives that question the status quo and spark change. BCG delivers solutions through leading-edge management consulting, technology and design, and corporate and digital ventures. We work in a uniquely collaborative model across the firm and throughout all levels of the client organization, fueled by the goal of helping our clients thrive and enabling them to make the world a better place.
