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Old 19th June 2013, 08:50   #1
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Question Are luxury car brands losing their exclusivity?

In the past few years we have been seeing immense advancements in the automobile industries. Newer technologies to reduce emissions, lighter materials used without compromising on safety, high-tech safety aids, platform sharing etc. Along with this, engine downsizing is catching up in a big way, with even the big three Germans treading this path. So much that, many purists believes some of the ecstasies of motoring (e.g.; famed in-line 6 engines from BMW, or RWD layout) could soon be a part of glorious history.

Along with the aforementioned areas, technology/engine sharing is something which manufacturers indulge to reduce costs. Audi has been slammed by many for doing parts-sharing with lesser brands like Skoda, VW or Seat. The Prince engine co-developed by BMW and PSA Peugeot CitroŽn were doing duty in many models ranging from small hatchbacks, MPVs, or hot hatchbacks like Peugeot 208 GTi, CitroŽn DS3, Mini Cooper, BMW 1-series etc.

Now the question Ė are luxury car makers losing sheen by sharing engine/technology with mainstream brands? Some recent examples:
  1. The base A-Class diesel is powered by Renault dCi engine. I maybe driving a Mercedes, but the engine is essentially the same which is found in a Nissan March.
  2. There are rumours that the next gen C-Class may use 1.6 diesel engines from Renault (Link to Team-bhp news section)
  3. BMW and Toyota collaborating on developing sports cars. The next Toyota Supra could be the first offspring of this relationship (news link from Autocar UK)
Personally I support these alliances, provided they donít dilute a brandís identity.
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Old 19th June 2013, 16:52   #2
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Default Re: Are luxury car brands losing their exclusivity?

Thread moved from Assembly line to The International Automotive Scene. Thanks for sharing!
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Old 19th June 2013, 18:27   #3
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Default Re: Are luxury car brands losing their exclusivity?

Well, let's say post globalization, notable car makers across the world have stumbled upon a few intelligent ways to make money. And more importantly, to survive.I respect them for that. It's basic economics and they're merely following suit.

Quote:
Originally Posted by vb-san View Post

Now the question Ė are luxury car makers losing sheen by sharing engine/technology with mainstream brands?
It all depends on how you cover things up after you're done with your dirty business. If the quality of the shared components match up to the expectations of that particular segment, and things don't smell fishy, I think it's perfectly all right. Some people call the RR Ghost a glorified 7 Series, which is true to a certain extent and you know it. But I don't think that fact makes its presence felt at all the minute you step inside one. Now that's what I call a cover-up!

Now if you see Audi sourced knobs in your Gallardo, scratch that, an Audi sourced engine in your Gallardo you're bound to be miffed a bit, because it's a bad cover-up. Maybe it gives Lamborghini a sissy image, but that doesn't make the Gallardo a bad car to drive. Which is all we should be concerned about.

It's like this. We're prying on this situation like any typical Indian old-timer opinionating about inter-caste marriages. There is a distinct dilution in cultures in case of the above, but that's the way things are right now. Economics dictate everything man, and things change just for a society to survive. And it's definitely difficult for some folk to accept change.

We, as enthusiasts have to adapt ourselves and our thoughts to this ongoing sharing business, and think accordingly because I don't think there's an escape from this situation apart from gloating about it. Manufacturers have moved on and are laughing all the way to the bank. Maybe they just sit back and think for a second where their identities have disappeared, but when they see their coffers overflowing, they smile again. But cars will always be cars, and as long as the fun factor remains, there is nothing to worry about.
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Old 19th June 2013, 18:31   #4
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Default Re: Are luxury car brands losing their exclusivity?

Good observation vb-san.

Not only are the engines being shared between Mercedes Benz and Renault, but I suspect platforms are also being shared.

For those who understand platform sharing, please have a look at how similar the overall length, wheel base, front track, rear track, front overhang, rear overhang and overall height is between the following pairs of Mercedes Benz and Renault vehicles.

1. A Class 5 door hatch ( http://tools.mercedes-benz.co.uk/cur...es/a-class.pdf ) and Megane 5 door hatch ( http://www.renault.co.uk/Resources/P...ganeFamily.pdf )

2. B Class 5 door MPV ( http://tools.mercedes-benz.co.uk/cur...es/b-class.pdf ) and Scenic 5 door MPV ( http://www.renault.co.uk/Resources/P...enicFamily.pdf )

It might shock several A / B Class owners to realise that underneath it all, they're driving a Megane / Scenic.

Cheers,

FourWheelDrift
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Old 19th June 2013, 19:42   #5
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Default Re: Are luxury car brands losing their exclusivity?

Great thread and observation vb-san.
Exceptional observation FourWheelDrift too!!

Apart from the sharing of engines and platforms the sharing of parts amongst the companies owned by 1 parent company is quite inevitable, but its also good in a way.
VW owns lamborghini and it has just been good for the latter as for example the air-conditioning in pre-VW lambos was pathetic but after VW taking over Lambo it is now like that of any other luxury car.
Also, VW can make Lambos better by making them super-fast-super-luxurious which alone Lambo wouldn't have been able to.(I know that I'm talking about an owned company and not a collaboration but one can get the flow.)

Even if a technologically superior company collaborates with an inferior one, they know the perils and the pros and cons of it much better than the layman.
So , yes its quite disheartening to learn that your 40 lac Mercedes shares the engine with a 10 lac Renault, but apart from that 1 thing there are 100 other things which are only unique to the Mercedes and do not belong to the Renault.

The F1 counterpart to these instances is the collaboration of McLaren and Honda developing engines.
As everyone knows, McLaren is technologically much superior to Honda when it comes to building super-powerful engines but they have come together and have created an excellent engine.

My two cents.

-Bhargav
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Old 19th June 2013, 22:07   #6
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Default Re: Are luxury car brands losing their exclusivity?

Good thinking vb-san! Ayan, your justification is wonderful, esp inter-cast marriage.. LOL

Most of the brands don't want to reinvent the wheel nor they want to deal with patent infringements. Tesla and Mercedes have been working in joint collaboration for hybrid technology for a long time. Chrysler's Jeep liberty/Cherokee is still based on ML platform (Shared when Daimler had stake in Chrysler).

Though same company, different branding: Lexus/Toyota; Infiniti/Nissan;Acura/Honda. On my Acura TL the windshield and door glasses say "HONDA". Since there's no Acura dealership nearby, I end up at Honda service; 80-90 percent parts are from Honda though Acura is sold as a luxury brand in US.

As long as they come out with an excellent product, I wont mind! Like Subaru and Toyota's new product!
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Old 19th June 2013, 22:27   #7
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Default Re: Are luxury car brands losing their exclusivity?

Quote:
Originally Posted by vb-san View Post
are luxury car makers losing sheen by sharing engine/technology with mainstream brands? Some recent examples:
Truth is, the vast majority of real exclusive/luxury car brand buyers could not give a toss!

I'm sure there are members of this forum who are actual exclusive car brand buyers, but I suspect they are the minority when it comes to the total number of exclusive car buyers.

An acquaintance of mine used to own a Jaguar/Aston/Ferrari dealership. They kept statistics on their sales processes. On average it took one hour to sell a Ferrari, 2.5 hours to sell an Aston and 4.5 hours to sell a Jaguar. Or as he put it, the cheaper it gets the more complicated it gets, the more questions get asked, more technical detail, more negotiations, several trips to the dealer back and forth etc.

Now the Ferrari buyers did get a very different treatment and follow up from the Jaguar buyers. Different show rooms too. You don't get treated badly when you buy a Jaguar, but with the Ferrari comes true red carpet treatment. Nothing as mundane as technical specifications gets discussed, nor the price, The color of the car, the interior material and color are very important. Nothing else matters, really, other than delivery time. And even that is more or less a given. Except perhaps for the ultra rich and famous as Ferrari has been known to shuffle the delivery schedule a bit to favor certain customers.

If you ever want to see the perfect visualization of the difference between Ferrari and other car owners go and visit the yearly Classic Car Grand Prix at the Nordschleife or Nurnburgring in Germany. I haven't been there for the last few years, but I used to go every year.

This is a huge event and just about every (classic) car club in Europe goes there for the weekend. So there is more to see of the circuit then on the circuit. The Ferrari club used to have, right in the middle of the circuit/paddock area a huge tent for their members. Had an excellent restaurant, bar with champagne, you could get your hair done, get a suntan on a a subbed, sauna, the works etc.

All Ferrari owners, were old gits, too fat, wearing red pants or worse checkered golf pants, unbuttoned shirts and lots of golden chains and watches. Their women, were skinny, and looked liked artificial Barbies with bleached hair and all had spent way to much time on the sun bed.

By and large I always found them a very amicable lot. Very easy going, very pleasant to talk to and swig some of that champers.

The various Jaguar clubs consisted mostly of couples well into their fifties, who, irrespective of their nationalities, all tried to pretend to be British upper class.
Great fun, just don't mention Labour and you'll have a great time mingling with this crowd. They have seen and done it all, are extremely opinionated about anything and everything under the sun, but are way to polite and sophisticated to make anything big out of it.

The Aston Martin clubs were a bit like the Jaguar clubs, by and large ten to fifteen years younger, and all a bit more stuck up. All the guys secretly think they are Daniel Craig, whereas clearly they're not, their bellies and bald spots on their heads give them away.

I usually took to this event with the Dutch Alfa Romeo Spider Register. We packed tents, sleeping bags and barbecues and all of our kids into our little Spiders. Just camped out for three days. I don't think Ferrari owners have kids. Never saw one on their patch.

Now, some of this might also be down to definition of what a luxury car is. Based on some of the other comments I take it we're primarily looking at the Audi's, Mercedes and BMW's of this world. Now, I've owned a fair number of these and although they are luxury cars alright I never considered them that special. In fact in most of Europe for instance Audi's share the showroom with Volkswagen. Although they have been putting up dividers in many showrooms to give that "exclusive Audi feeling" whatever that might be. But in essence more and more parts get shared.

I said it before on this forum; to me all of this sharing means mediocrity at worst, average at best. Technically all of it might be very advanced, but I don't care at all. When I start spending this sort of money on a top of the range Audi, Mercedes, Jaguar I want every detail of the car to be special and unique. I don't want it shared with anybody or anything! I want it to be unique to my car, period!

Years ago, my friend the Jaguar/Aston/Ferrari dealer called me. He just had a trade in Aston. Would I be interested? So I went over, only to find out this was one of the Ford Era Astons. Beautiful car, but the switch gear was straight out of a Ford Mondeo. I mean, even on a twenty year old second hand Aston I would not want that, no matter what the price. It's just utterly pathetic.

My friend called me an anal nerdy anorak car freak that would not recognize a good deal when it was staring him in the face. With most of his customers he tends to be a little more smooth. But hey we went to school together, so he thinks he can take liberties.

Still, BMW, Audi, Mercedes, Jaguar will go to great length to try and position themselves as something special. Good for them, but I can't help thinking of an Audi as a stuck up VW these days. Nothing wrong with a VW, I've owned several, they are pretty good cars but not anything what I would call special or particular luxurious.

So I don't like this sharing at all. Will it impact the sales for the high end brand? I don't think so. Even though most Audi, Mercedes, BMW customers are probably in the 4-6 hour buyer category in the end they have already made up their mind they want a BMW, or an Audi. so they just need the dialogue to convince themselves.

Research shows in this segment shows that it is the brand that sells most, more then the technical specifications. Branding is absolutely crucial for them. And branding and technical specification are two very different things.

Truth be told, it mostly the anorak guys like us that now these sort of details, e.g who share what platform, what engine or what switch with whom.

Jeroen
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Old 19th June 2013, 22:42   #8
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Default Re: Are luxury car brands losing their exclusivity?

With the increasing commoditization of all luxury brands and the steady growth in the populace who can access these brands, the whole benchmark of luxury has moved on.
It will ever be so because the really wealthy people will have already sought out and moved away from what perhaps were traditionally considered luxury marques. They would move towards significant personalization and customisation rather than stick with a "mass produced luxe" product. This will lead to more concepts like that Overfinch designed Range Rover and other similar things!
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Old 19th June 2013, 22:53   #9
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Default Re: Are luxury car brands losing their exclusivity?

To me luxury cars have not loosed exclusivity as much as they lost their characteristics.
Even as little as 10-15 years back, the blur between car classes had not set in much. You know when you travel in a corolla and tell its a small car, as well as you travel in a Merc/Lexus and know where the money has went in.
But now the lines have blurred, much like how C2 segment sedans do 90% of what D1 sedans do at half the price.
True, luxury cars have depth of engineering, but in everyday use, they are not probably seen or felt, unless its something like a 7er or S class. Travel 10-15kms(backseat) in a Corolla Altis and an E class, perhaps other than a little NVH difference you won't miss much.
Today, its more of a gadget/gizmo play and flashy styling that pays.

Like how us Indians are falling for punchy efficient diesels with flash styling and nothing more. (Looks at Audi sales figure)
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Old 20th June 2013, 09:23   #10
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Default Re: Are luxury car brands losing their exclusivity?

Some good viewpoints there!

Quote:
Originally Posted by AyAn! View Post
Well, let's say post globalization, notable car makers across the world have stumbled upon a few intelligent ways to make money. And more importantly, to survive.I respect them for that. It's basic economics and they're merely following suit.

It all depends on how you cover things up after you're done with your dirty business. If the quality of the shared components match up to the expectations of that particular segment, and things don't smell fishy, I think it's perfectly all right. Some people call the RR Ghost a glorified 7 Series, which is true to a certain extent and you know it. But I don't think that fact makes its presence felt at all the minute you step inside one. Now that's what I call a cover-up!
As mentioned in my post, I am not against these alliances. In many cases, the results are wonderful. A recent example is Toyota and Subaru collaborating on the wonderful GT86/BRZ.

Quote:
Originally Posted by AyAn
It's like this. We're prying on this situation like any typical Indian old-timer opinionating about inter-caste marriages. There is a distinct dilution in cultures in case of the above, but that's the way things are right now. Economics dictate everything man, and things change just for a society to survive. And it's definitely difficult for some folk to accept change.
Well, nowadays Indians are everywhere and probably the Indian old-timer influence is catching up heavily in the western world, because debates on these areas originate from there

There is nothing wrong in dilution of cultures, and when it comes to consumer products/cars I support the idea of smaller players step-up their game and compete on par (or better) with traditionally stronger competition. Hyundai-KIA is a recent example. Another success story is of Skoda who is getting stronger in Europe, so much that the big sister VW is forced to up the game. And I find these aspects quite wonderful. It helps the lower ones to come up, and also force the big brothers to keep updating themselves.

Quote:
Originally Posted by AyAn
We, as enthusiasts have to adapt ourselves and our thoughts to this ongoing sharing business, and think accordingly because I don't think there's an escape from this situation apart from gloating about it. Manufacturers have moved on and are laughing all the way to the bank. Maybe they just sit back and think for a second where their identities have disappeared, but when they see their coffers overflowing, they smile again. But cars will always be cars, and as long as the fun factor remains, there is nothing to worry about.
The majority may not be really bothered about the points being discussed here, but itís a bit bothersome for those who really see the details of what they are getting. I for one, admire brands which retain their core-values, especially those points which made them what they are.

Quote:
Originally Posted by Octane_Power View Post
Apart from the sharing of engines and platforms the sharing of parts amongst the companies owned by 1 parent company is quite inevitable, but its also good in a way.
VW owns lamborghini and it has just been good for the latter as for example the air-conditioning in pre-VW lambos was pathetic but after VW taking over Lambo it is now like that of any other luxury car.
Also, VW can make Lambos better by making them super-fast-super-luxurious which alone Lambo wouldn't have been able to.(I know that I'm talking about an owned company and not a collaboration but one can get the flow.)
Good point there. A typical case of give and take in a positive way. Ford-Volvo is another example. Ford gained hugely by having access to the Volvo safety standards, and Volvo made good use of Fordís prowess in engine technology.

Quote:
Originally Posted by Jeroen View Post
Truth is, the vast majority of real exclusive/luxury car brand buyers could not give a toss!
Ö
Ö
Truth be told, it mostly the anorak guys like us that now these sort of details, e.g who share what platform, what engine or what switch with whom.
Jeroen
Thanks Jeroen, very informative write-up indeed!

Quote:
Originally Posted by shankar.balan View Post
With the increasing commoditization of all luxury brands and the steady growth in the populace who can access these brands, the whole benchmark of luxury has moved on.
It will ever be so because the really wealthy people will have already sought out and moved away from what perhaps were traditionally considered luxury marques. They would move towards significant personalization and customisation rather than stick with a "mass produced luxe" product. This will lead to more concepts like that Overfinch designed Range Rover and other similar things!
Very true! And itís not a bad thing. Those not-so-mass-market luxury brands are trying to make the situation work in their favour, and also trying to penetrate into new segments. For e.g.; planned 3-series rival from Jaquar, and recently launched Ghibli from Maserati.

Quote:
Originally Posted by DicKy View Post
To me luxury cars have not loosed exclusivity as much as they lost their characteristics.
Even as little as 10-15 years back, the blur between car classes had not set in much. You know when you travel in a corolla and tell its a small car, as well as you travel in a Merc/Lexus and know where the money has went in.
But now the lines have blurred, much like how C2 segment sedans do 90% of what D1 sedans do at half the price.
True, luxury cars have depth of engineering, but in everyday use, they are not probably seen or felt, unless its something like a 7er or S class. Travel 10-15kms(backseat) in a Corolla Altis and an E class, perhaps other than a little NVH difference you won't miss much.
Well thatís because the some of the so-called mass market brands have really improved in the past few years. The Skoda Superb is a fine example.
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Old 20th June 2013, 09:56   #11
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Default Re: Are luxury car brands losing their exclusivity?

I think most car buyers do not even know about what parts are shared between cars. Our "national engine" has so many names - DDiS, MJD, Quadrajet etc - how many people even know they are the same?

Personally, I think it all depends on what direction the parts are shared. If someone told me that next gen Renault XYZ would use a Mercedes-sourced engine, I may not care much as a Mercedes buyer. But when I hear that next gen C-class might use a Renault-sourced engine, I feel happy that we bought a current gen C-class
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Old 20th June 2013, 19:46   #12
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Default Re: Are luxury car brands losing their exclusivity?

Quote:
Originally Posted by vb-san View Post
Very true! And itís not a bad thing. Those not-so-mass-market luxury brands are trying to make the situation work in their favour, and also trying to penetrate into new segments. For e.g.; planned 3-series rival from Jaquar, and recently launched Ghibli from Maserati.


Well thatís because the some of the so-called mass market brands have really improved in the past few years. The Skoda Superb is a fine example.
The ultimate Holy Grail if I may, is always Sales and the resultant Lucre. Hence the desire of every brand to ultimately be bought by more and more people. With greater growth and and greater exposure comes greater aspiration and greater consumerism as well.

India, China and the rest of the "Developing world" are now firmly on that path, like Hongkong was in the 1990's!
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Old 20th June 2013, 21:08   #13
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Default Re: Are luxury car brands losing their exclusivity?

IMHO, it all comes down to brand perception (and looks), which is based a lot on advertising. Reality (technical details) can take a hike for most consumers. The Corporations know this. How else can the same brand can be perceived differently in different markets. The Duster is sold as Dacia Duster in many European markets as low cost vehicle. Here it's marketed as a Renault and is perceived to be more of an upper middle class vehicle. Honda's are run of mill in the States. e.g. The Civic is very popular with students. Here Honda is perceived as a luxury brand.
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Old 20th June 2013, 21:45   #14
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IMHO, it all comes down to brand perception (and looks), which is based a lot on advertising. Reality (technical details) can take a hike for most consumers. The Corporations know this. How else can the same brand can be perceived differently in different markets. The Duster is sold as Dacia Duster in many European markets as low cost vehicle. Here it's marketed as a Renault and is perceived to be more of an upper middle class vehicle. Honda's are run of mill in the States. e.g. The Civic is very popular with students. Here Honda is perceived as a luxury brand.
Well the Civic can be cheaper in India if the import taxes are normalized like other nations. I'm assuming its still 110% for CBU's and less for assembled cars in Indian plants. The Civic in US starts from around $17,500 (Rs 9L+) but in India its around 13L. The VW Jetta is right now selling for $13300 (Rs. 7.3 L) in US; In India its 14L , almost double! Its all about the geographical location and the import taxes that effects the brand image.
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Old 20th June 2013, 22:01   #15
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Default Re: Are luxury car brands losing their exclusivity?

Quote:
Originally Posted by bdman View Post
IMHO, it all comes down to brand perception (and looks), which is based a lot on advertising.
Quote:
Originally Posted by VIPER_SRT View Post
Well the Civic can be cheaper in India if the import taxes are normalized like other nations.
Isn't it also a question of some of these things -
  1. Per capita income and affordability - For US, if the per capita income is around 30k USD - the average car transaction price is around 30k USD. In India, only a few in the upper middle class will consider a 30k USD car, whereas in the US, that will be in the reach of a lot more of the population.
  2. Road and traffic conditions - what would you do with larger cars in India when it is harder to drive and park with big cars?
Anyway we are drifting off topic - but yes the brands are crossing into each others spaces. Mercedes, Audi and BMW want a pie of the larger market of cheaper cars. Just that for the same price as an Accord or Camry you will only get a car from the premium brands with the size of a Fit or Yaris with rather more powerful engines and entertaining driving characteristics. Purely depends on what you want - large family car or small fun luxury car. With the push for fuel economy also very strong, I suppose engines are one place where things are even more blurred. But I still think the implementation of direct injection and turbo charging that the German brands sell are a notch better than what a Hyundai or so sell to us.
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