During the traditional ICE vehicle age, the essence of premium brands was almost equivalent to “luxury.” With luxurious exteriors, power output, features, interior materials, boastful technologies, and even safety designs, premium brands can then attract high-income buyers with such expensive prices. However, when entering the intelligent V2X EV era, will premium auto buyers still fixate on luxury-focused brands or models? When the global economy enters Industry 4.0, the fast-growing middle class becomes the major consumer group (e.g., China and Southeast asian countries), the wealthy are no longer shackled by real estate and inheritance, and environmentalism and sustainable development becomes human’s consensus, the value of “luxury” to the general public is starting to decline (at least in developed countries such as Europe, the US, and Japan). As a result, high-income personnel view car-buying differently, with innovation, environmentalism, and intelligence representing premium brands. With auto design innovation via ICT development approaches, environmentalism via new energy vehicles replacing ICE cars, and intelligence via auto AI, new auto products are starting to change consumer values in vehicles’ new era.
- Tesla is the pioneer in breaking ICE car’s brand positioning. By combining the three elements above, the company has initiated a disruptive commercial race with traditional premium brands, lowering the priority of “luxury” in buyers’ motives. For example, Mercedes’ sales performance in this year’s first three quarters was 1.5 million units, 6% lower than last year’s figure, while Tesla achieved 900k units, closing in on last year’s annual sales of 930k. In the next three years, Tesla’s sales may outperform Mercedes.
- VAG’s two premium brands, Porsche and Audi, delayed their intelligent EV product launch due to the delayed R&D works of CARIAD, the group’s automotive software and technology company. Recently, VAG had further established a joint venture company with Chinese startup Horizon Robotics to accelerate R&D work on intellectualization. As a result, Porsche and Audi’s future products will likely have more Chinese tech running through their veins.
- Lexus, the staple brand of premium Japanese automakers, has announced a plan to offer electric options across all models by 2030 (and their ICE counterparts), followed by a total switch to EVs by 2035. For the hybrid and FCV-focused Toyota, the announcement was indirect proof of the group’s EV preference over other new energy vehicles. As for Japanese automakers’ intellectualization, its development progress is behind Tesla and Chinese self-owned brands, the same as German premium brands.
After a few years, when intellectualization brings fully-autonomous driving technologies into mass production, L4 and L5 autonomous driving systems will fully integrate with premium brands’ product lines and might divide them into two different branches, L2 and L4/L5. Additionally, L4/L5 models’ IVI will become a new battlefield for premium brands.