What fiscal cliff? Luxury car sales zoom
Porsche, Maserati and BMW are seeing major momentum. But better sales of high-end cars don't necessarily translate to an improved market for other luxury goods.
If you're looking for a car that will send your neighbors into fits of envy, and are able to shell out the necessary cash, now might be a good time to buy. The luxury auto market is booming.
German automaker Porsche, known for its costly sports cars, says it has already broken last year's record for sales.
Even with one month left in 2012, Porsche's global sales for the first 11 months of 2012 were up 38.7% over the same period in 2011. Wednesday, the company reported it has delivered 128,978 new vehicles to customers around the world, beating last year's yearly figure of 118,868 with a month to spare.
Porsche, owned by Volkswagen (VLKAY), says its strongest markets last month were the United States -- with American sales increasing by 71.4% from a year earlier -- and China, where car sales increased by 63.4%.
"The fact that we have already surpassed the previous year's result in November is no reason for us to rest on our laurels," said Bernhard Maier, a member of Porsche's executive board of management. "On the contrary, it is an incentive to deliver maximum performance in the next year -- in spite of continued uncertainty in the marketplace."
And nowhere is that economic uncertainty more evident than in Porsche's backyard. The ongoing debt crisis in Europe is depressing economies across the continent -- and also taking a huge bite out of new-car sales there.
The European Automobile Manufacturers' Association says overall new-car registrations in Europe for the past five years are expected to have fallen by over 3 million, making 2012 the worst year for new car registrations since 1995.
But Fiat also owns the legendary Maserati line of sports cars -- and says that over the next two years it will introduce three new Maserati models while planning "a significant increase in production, reaching up to 50,000 vehicles a year by 2015."
So what's going on? Despite the European crisis, growth in emerging markets such as China are helping fuel sales of both high-end and economy cars around the world.
"The premium producers are doing very well and the lower end is doing well too," David Bailey, professor at the Coventry University Business School, tells the BBC. "What you have is a bit of a squeezed middle."
But better luxury car sales don't mean a better market for luxury goods, overall -- as even the very rich look for ways to balance their budgets.
Analysts quoted by Reuters say it will probably take at least until the second quarter of 2013 for the luxury goods market to regain its momentum. In the meantime, "European companies such as Ferragamo, French conglomerate LVMH (VLMUY) [owner of Moet & Chandon champagne, Louis Vuitton and Christian Dior] and Italian peer Prada (PRDSF) have escaped the worst effects of the economic downturn this year thanks to spending by wealthy tourists from Asia and Russia."
More from Money Now
The market is up 60% with Obama.If you listened to our negative far right media
you`d think the market was down 80%.Intelligent people have made a ton with our
markets for 4 years.How seldom do you hear the Dow was down 37% with
Bush?These are the good old days.
I SEE SO MANY PEOPLE IN EXPENSIVE NEW CARS IN MY APT BUILDING AND MOST OF THEM
DON'T WORK FAR AS I CAN TELL AND THEY ARE THE YOUNG BLACKS AND WHITES WHO
I'M POSITIVE HAVE NO JOB IF ANY THAT COULD AFFORD THESE CARS! I HAVE A FEELING
AND BEEN TOLD JUST LIKE THE BANKS WITH HOUSING LOANS THEY ARE TOLD TO GIVE
CARS AWAY SO SALES GOES UP AND LOOKS LIKE ECONOMY IS GROWING AND THEN THEY
JUST REPOSSES THE CARS AND STILL MAKE A KILLING! DON'T THINK IT'S TRUE? I DO!
I KNOW A GUY WHO'S DEALERSHIP WAS CLOSED BECAUSE HE WASN'T UNION AND HE
DIDN'T WANT TO PLAY ALONG WITH OBAMA'S BAILOUT! FACT!
I don't consider Porsche', BMWs or Maseratis....Luxury cars....High end/near end, but not luxury.
Obama hater, yeah they closed a lot of dealerships, that were not profitable (selling quotas) and the Market had been squashed.......BY THAT OTHER GUY...
Remember the Financial Collapse.....DO YOU WANT ME TO SPELL HIS NAME...??
It only had 4 letters in it...FACT !!!
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