China???s Wealthy Prefer Mercedes, Lesser Premium Brands Gaining Photo:
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Mike Stevens | Dec, 01 2014 | 4 Comments

China, already the world’s largest car market for overall sales, is expected to surpass the United States in an even more crucial category by 2016: premium brands.

A new survey of China’s more affluent buyers this week reveals that while Audi is the country’s best-selling prestige brand, it is Mercedes-Benz that holds the fancy of wealthy and successful entrepreneurs.

Who prefers Audi, then? According to the Shanghai-based Hurun Research Institute, the four-ringed brand is most associated with high-placed government workers, while fellow German marque BMW is the favourite of China’s nouveau riche.

These details are the result of research into eight major luxury brands offered in China, surveying 800 luxury-car owners across 10 cities.

China’s growing middle class is also good news for premium brands that don’t perform quite as well in the West as the German powerhouses, with the survey revealing that most consumers in China are first-time car buyers.

This has given the likes of Infiniti, Lincoln and Cadillac a leg-up, allowing the Japanese and American premium badges to compete on a playing field less-affected by pre-conceived bias among buyers.

Both brands are also seen to be benefiting from the relative youth of China’s luxury-car owners, with an average age of 33.5 years and a household income equivalent to AU$188,500.

Those German halo brands remain the marque of choice for top earners, however, with China’s average Cadillac buyer coming from the white-collar office-working ranks.

As for Lexus, easily the more dominant of Japan’s two major international luxury brands, the survey reported only that the marque “had no clear owner attributes”.

In Australia, BMW sits comfortably at the top of the premium brands chart, its 7942 year-to-date sales (end of October) shading Audi’s 6233.

Compatriot Mercedes-Benz is a distant third with 4021 sales YTD, followed by Lexus with 1912 sales and Jaguar on 994.

Infiniti, with just 122 Australian sales year-to-date, would likely sell its own grandmother for some of that ‘no existing bias’ magic powder its Chinese counterpart is enjoying, notching up 14,000 sales in the first half of 2014 alone.

Another premium brand finding success in China in recent years is Volvo, with sales growing from 61,146 in 2013 to "at least" 80,000 in 2014.

With more advanced premium offerings like its new 2015 XC90 SUV on the way, the Hurun Research Institute's next survey of luxury car owners could see Volvo make ground on its German rivals.

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