Written by / Ma Xiaolei
Editor/ Qian Yaguang
Design / Shi Yuchao
Source/ Wall Street Journal By William Boston
The epidemic is raging, the chip shortage, the car market is generally not good, but the luxury car market is a unique scenery.
According to reports, as luxury automakers prioritize scarce chips to the most profitable models, Rolls-Royce, Bentley, bmw sales have broken through record highs, and mass market brand sales have fallen behind.
Not just luxury cars, the entire luxury industry in 2021 has performed very well, even more than in 2019 before the epidemic. This was followed by a new round of price increases. According to media reports, at the beginning of the 2022 new year, Rolex took the lead in announcing the simultaneous global increase in the official price from January 1.
Luxury cars are upstart
BMW will sell 2.5 million units in 2021, which is better than many of its competitors
During the epidemic period, traveling abroad is basically no longer a play, and the young generation of luxury car consumers who have money and nowhere to spend have simply come to a shopping spree.
At the same time, manufacturers are facing a shortage of semiconductors, prioritizing the production of some high-margin models. Alain Favey, head of sales for Volkswagen's Bentley brand, said: "The lack of cores has had little impact on us. ”
"The Volkswagen Group has a highly centralized production process, and profit margins are one of the factors that determine distribution," he says. From this point of view, we get the priority and are able to get the chip we want. ”
Other manufacturers are also facing shortages of chips or other components, and for similar reasons, they have prioritized the production of high-priced cars, and consumers cannot buy cheaper cars.
Bentley sold 14,659 vehicles in 2021, up 31 percent from the previous year and setting a sales record for the company
Bentley sold 14,659 vehicles in 2021, up 31 percent from 2020 and set a sales record for the company. Porsche, also part of Volkswagen, sold 301915 cars worldwide, up 11 percent. Both brands have grown in the U.S., Europe and China.
In contrast, the Volkswagen brand, which contributes most of the group's sales, struggled throughout 2021 to keep the plant running due to a shortage of chips, and the total factory in Wolfsburg was forced to cancel the annual rotation due to insufficient capacity.
This resulted in Volkswagen brand global sales down 8.1 percent to 4.9 million units. China was the largest market for the masses, with sales also down 14.8 percent.
Volkswagen's performance reflects the prevailing situation of manufacturers in the mainstream market. While traditional sedans, hatchbacks and station wagons languish, SUVs and electric vehicles have reaped huge benefits.
In the United States, BMW has topped the luxury car sales list for three consecutive years, and 336644 units sold in the market in 2021, an increase of 21% year-on-year. In second place is Toyota's Lexus brand, which sold 304476 units, up 11% year-on-year.
Tesla managed to avoid chip shortages, and full-year sales of the Model Y SUV helped the company's global deliveries soar 87 percent.
In the U.S., Tesla sales even surpassed Mercedes-Benz, which announced U.S. sales of 276102 units in 2021.
While Tesla didn't announce specific sales for each country and region, consultancy Ward's Intelligence estimates that Tesla will sell about 299,000 units in the U.S. in 2021.
BMW's Rolls-Royce ultra-luxury cars start at more than $300,000, and the company's sales reached 5,586 units in 2021, up 49% from 2020 and the highest record in the brand's 117-year history.
Martin Fritsches, president of Rolls-Royce Americas, said buyers of ultra-luxury cars like Rolls-Royce are younger today. The average age of customers is about 43 years old, which means that there are many customers who are around 30 years old.
In a way, Fritzches said, Rolls-Royce's customers are among the lucky ones in this outbreak. They have profited from the economic recovery, the cryptocurrency boom, and soaring stock prices. And many buyers are buying Rolls-Royce for the first time, including young entrepreneurs who made their fortunes in the stock market and cryptocurrencies, he said.
Electric drive
Electric vehicles are another boost to growth. BMW has performed better than many of its competitors in the chip crisis, with the BMW Group (including mini and Rolls-Royce brands) selling 2.5 million cars worldwide in 2021, an increase of 8.4 percent. Among them, the company sold a total of 103855 pure electric vehicles.
"In 2022, our goal is to more than double the sales of pure electric vehicles." Pieter Nota, BMW's head of sales, said, "Throughout 2021, BMW's chip supply is sufficient, and by establishing direct contacts with chip manufacturers, it is expected to be able to smoothly pass through 2022." ”
He said the first half of 2022 could continue to be affected by chip shortages, but added that BMW could help mitigate the impact again through direct contact with chip suppliers.
Porsche says sales of the Taycan, the company's electric sports sedan, surpassed the company's iconic 911 sports car in 2021, representing a historic shift – even Porsche customers are beginning to embrace electric vehicles.
Global industry consultant IHS Markit predicts that global sales of new light vehicles will grow by 3.7 percent to 82.4 million units in 2022, up from 2.9 percent in 2021, when growth in this segment is being constrained by supply chain disruptions.
In the U.S., the company expects new light vehicle sales to grow about 2.6 percent to 15.5 million units in 2022.
According to consultancy Wards Intelligence and LMC Automotive, with the spread of the pandemic and widespread plant shutdowns, vehicle production in 2020 is down about 16 percent from 2019 to 74.6 million units.
The auto industry pulled back some in 2021, with global production up about 2 percent to 76.2 million units. The companies predict that global production will rebound 13% to 85.8 million units in 2022, but it is still below pre-pandemic levels.
Despite hitting new sales, Friches said Rolls-Royce will remain a niche, intimate luxury brand focused on creating experiences for customers.
To attract younger customers, Rolls-Royce is connecting with car owners through an app called Whistlers. Access this app only if you actually own a Rolls-Royce.
Friches said: "Our customers seek customized experiences. I can assure you that quantity is not, and will never be, our focus. ”