Archive for June, 2015

HNWIs Demand for Luxury SUVs On the Rise

Tuesday, June 16th, 2015

Market luxury automobiles and SUVs to high net worth individuals HNWI.

High Net Worth Individuals are driving sales of Luxury SUVs.

Suddenly the wealthy are trading in their sports cars for more practical luxury SUV models. CNBC reports that super-luxurious SUV sales are up 44% this year.

Lamborghini hopes to muscle in on market share in 2018 with the introduction what many are calling the “Rambo Lambo.” This luxury SUV will join the likes of the Porsche Cayenne, Cadillac Escalade, and Land Rover’s Range Rover. There will also soon be new models from Tesla, Bentley, Jaguar, and a rumored Rolls-Royce.

Trucks in Tuxes

Fortune magazine is calling it a “Seismic shift in the luxury car market.” New Range Rovers are on a 6-month waitlist, the number of Escalades has doubled, and sales of a flashier Lincoln Navigator with LED running lights are up 84%. Hyundai, yes the maker of the $15K Ascent, is even mulling a luxury Genesis SUV.

In all, luxury SUVs constitute 46% of the high-end auto market, while sales of luxury sedans and sports cars are slipping. It can’t just be that cheap gas is driving this trend. Those who can afford to sit in the captain’s chair of a sweet $80,000 ride can afford to pay a few more bucks at the pump. So what’s putting these pricey SUV’s in the fast lane?

My Opinion? Three words: High Net Worth 

As more people enter the ranks of High Net Worth Individuals (HNWIs), they are opting to drive big, roomy, luxurious SUVs. While there may be some cannibalization of smaller models among the luxury SUV brands, overall sales are rising.

Notice I did not say “high income.” A nice salary is not enough to comfortably put you behind the wheel of these large automobiles. A sizable, diversified investment portfolio can, which is what an HNWI has.

How do I know there is a growing number of HNWIs? We just updated Wealth Window and I see more than 19 million multi-millionaires on the file. This time last year we reported 15 million. I also see nearly 700,000 luxury automobile owners on the file. Luxury auto dealers, and all luxury retailers for that matter, might want to steer these HNWIs into the showroom. Let me know if you would like to test-drive the list.

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