Luxury vehicle sales are expected to increase 32 percent by 2021 due to added demand for new models from consumers, according to an analysis by PwC, an international firm that provides tax and advisory services. The firm operates a large practice in downtown Detroit.
“More and more automakers and models are entering the lucrative luxury market,” says Rick Hanna, global automotive leader for PwC. “We anticipate it will begin to resemble the competitive nature of the non-luxury space, where there are smaller gaps between leaders and the rest of the market, and a more evenly distributed market share.”
By 2021, PwC anticipates the total number of luxury nameplates will increase by 27 percent, and nearly 30 new models will enter the market. The firm says the number of luxury domestic models is expected to increase by 50 percent, and non-domestic nameplates are expected to increase by 23 percent.
Foreign luxury brands have held the lead for top-selling vehicles because of perceptions that non-domestic brands produce higher-quality vehicles, but that appears to be changing, Hanna says.
He says in 2014, the top three luxury brands controlled about 53 percent of U.S. market sales, but that number has dropped to 48 percent through April this year. He says the compact car and crossover utility vehicles are the fastest growing luxury vehicle segments. The large luxury SUV segment also continues to expand, with sales up 37 percent through April 2015.
For example, Cadillac is looking to add more luxury models, while Ford, via its Lincoln division, is bringing back the Continental next year as a 2017 model. â€‹