For many years, Christmas was the season to “put a ring on it,” if you will, but due to some deft marketing starting about a decade ago, the holiday season – particularly December – is when consumers are getting a ring … a key ring that is.
Experian Automotive notes that December is the time that luxury buyers select most often when buying a new vehicle. The last month is first in high-end vehicle sales accounting for 10% of all luxury sales. November is the next biggest month at 8.8% of purchases.
“Every year as the holiday season nears, consumers can expect to see a number of commercials and marketing campaigns advertising incentives on luxury vehicle models,” said Brad Smith, Experian’s director of automotive market statistics.
“While some consumers may be intrigued by the seasonal deals, others may be driven by the enjoyment of attaching the big red bow to the car as a gift. Either way, December is considered — by far — to be luxury vehicle month. By gaining insight into the trends that drive this demand, dealers and retailers will be better positioned to manage inventory and target prospective customers.”
(Luxury brand brawl battles into December. For more, Click Here.)
Not surprisingly, those buying vehicles in December are generally sporting a better than average credit score (746 versus 710), and are more likely to lease it (54%) than buy it on credit (30%). And, yes, for those of us who prefer an “all-cash Christmas” 16% of those buying lux models pay with the green stuff.
“Given the increased price for luxury vehicles compared with other vehicle segments, it’s understandable that the average buyer has a more affluent background,” said Melinda Zabritski, Experian’s senior director of automotive finance.
“That being said, it’s clear that these consumers still are exploring ways to keep their monthly payments low. By choosing to lease vehicles, consumers are able to lower their monthly payments by more than $160 a month.”
Lexus really helped define the Christmas season as the ideal time with its now famous and oft-imitated commercials where people found a new Lexus sporting a giant red bow on the roof in their driveways and garages about a decade ago.
(Click Here to see why Mercedes believes it’s what’s on the inside that counts.)
Initially, the brand also reaped the benefits and heading into this holiday season, Lexus is still leader with 18.2% of December sales. The rest of the top five includes: Mercedes-Benz (17%), BMW (16.4%), Acura (9.5%) and Audi (9.5%). At the model level, the top five are the Lexus RX 350 (5.1%), Mercedes-Benz C Class (4.1%), BMW 3 Series (4%), Acura MDX (3.2%) and Lexus ES 350 (2.9%).
A few other fun December luxury car sales facts, include:
- The average loan amount for a luxury vehicle is $42,876, nearly $14,000 higher than the average new vehicle loan amount
- During the third quarter of 2015, the average monthly payment for a luxury vehicle was $755, approximately $273 higher than the overall average monthly payment for a new vehicle
- Tesla has the highest average monthly payment for luxury vehicles at $1,285, while Acura has the lowest, at $605
- The average monthly lease payment for a luxury vehicle is $592, approximately $194 higher than the average new vehicle monthly lease payment
- The average interest rate for a luxury vehicle is 3.1%, compared with 4.6% across all vehicle segments
- Sport utility vehicles are the top luxury vehicle body style (46.4%), followed by sedans (41.8%) and coupes (6.5%)
Heading to the holiday homestretch, the year-long battle of luxury heavyweights was a tight race to see what brand would come out on top in the U.S. in 2015. BMW enjoyed a strong November to take a more than 2,500-unit lead on Mercedes, which suffered through an 11.5% sales drop last month. Lexus, which had started the year on top, but has finished third for the past several years to either of the aforementioned companies, is now in third place again.
(To see more about Acura’s Super Bowl advertising plans, Click Here.)
Mercedes and Lexus would both have to turn their December sales results for the last five years on their ear in order to supplant BMW and take the best-selling luxury brand title from BMW in 2015.