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European Luxury Brands Riding US, China Sales

Off-continent sales insulate makers from tough environment.

by on Mar.19, 2014

The Bentley GT Speed convertible is one of several recent additions helping buoy the marque's sales.

European car sales were up for the sixth month in a row; however, that bit of good news comes on the heels of the market suffering its worst downturn in decades, which is to say oftentimes good news is relative.

February sales rose 8% in February to 861,058 units, according to European Automobile Manufacturers’ Association. It was still the second-worst February ever. In short, it’s getting better, but there’s still a long way to go.

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However, luxury automakers have been bustling along during the downturn as if nothing had changed from the European market’s heyday.

BMW goes for a coupe-like look with the 2014 5-Series Gran Turismo.

BMW’s CEO Norbert Reithofer said that the company would sell more than 2 million vehicles in 2014, up from last year’s record-setting 1.96 million. Bentley sold 10,120 cars in 2013: a 19% increase and also a new record.

How have these two, as well as other luxury European marques like Audi and Mercedes-Benz, floated above the periphery? The United States and China.

Sales in Europe are slow, but in the U.S. and China they’re cooking and those are the biggest markets for luxury automakers now.

In fact, Reithofer announced plans to expand production at the company’s plant in South Carolina from 300,000 units to 350,000 as part of the company’s push to reach 2 million units in 2014. It makes sport utility vehicles including the X3, X4, X5 and X6 models at the facility. The company’s China sales jumped 19.7% in 2013 with more than 500,000 units.

The all-new 2015 Audi A3 is coming to America and will be offered in four different versions.

Bentley’s biggest market is the United States accounting for 31% of sales. Second? You guessed it: China with 22%.

(New VW diesel could fuel demand for high-mileage alternative. For more, Click Here.)

“Customers all over the world continue to be very enthusiastic about Bentley,” said Dr. Wolfgang Schreiber, chairman and chief executive of Bentley Motors. “The luxury car market is not static.”

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BMW also took advantage of a strong Chinese market in 2013 by investing in its facilities there and expanding its production by 100,000 cars to 400,000 last year. The German automaker told reporters yesterday that it expects significant growth in markets outside Europe including high single-digit growth in North America and low double-digit growth in China.

(To see why Porsche is replacing all of the engines in its new 911 GT3, Click Here.)

Scott Keogh, president of Audi of America, noted Audi sold more than 158,000 vehicles in the U.S. last year. With the introduction of the new A3 sedan — and variants such as the wagon-like Sportback and diesel-powered versions due next fall — as well as the new TT, the prospects of Audi’s sales reaching 200,000 units before 2020 are looking bright, he said.

However, it’s in China where Audi really enjoys success. It is the maker’s largest market and expects sales to exceed 500,000 units in 2014. The automaker is opening one new dealership in China every week to expand its sales network to 500 outlets in the next two years, sales chief Luca de Meo told Bloomberg recently.

The best-selling luxury brand last year in the United States was Mercedes-Benz, with sales of 334,344 units, where its sales were up more than 6%. In China, the company’s sales rose 11% to more than 235,000 units.

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