I think I fall into that category of not feeling as well off as I am. There always seems to be a lot more uses for money than there are sources. But you get to the point of asking just how much a means of transportation is to you. I can still get swayed by cars, seems like there is less and less that I enjoy in life, but I sense there is a bit of a shift compared to say five years ago. I don't see people as envious of AMG or bimmer Ms or even just luxo brands in general.

Maybe people are more concerned about other things than flashing how much value they place on their car to everyone. I am not sure USA Today should be a supreme authority on anything automotive but it really would not surprise me to have expensive hardware being traded in and not replaced with like or more expensive vehicles. I know a three series bimmer is a fine car but doggone, with tax and license you can push $50K for one and that is just getting harder to justify. It wouldn't surprise me that other people are going through the same thing.

 

I would think there is some correlation between housing prices and luxury ($50K+) cars. That said, my independent, completely un-scientific poll shows...

Lexus discounting the new GS for several months now and plenty to be had at the dealer.
BMW 550s which dealers are looking for sticker on are starting to stock up in local dealers (one now has 7 of them - the lowest priced is $64K).
Infiniti M45s being very scarce - in fact, harder to get today than 2 months ago.

My thoughts on all of this are that people are getting smarter with their money and they are better informed. The GS does not do well in competitions (Consumer Reports continues to knock it bad), the 5-series is priced $10K more than the GS, and the Infiniti, a car that is 9/10ths the 550 with more features goes for $12-13K less than a comparably equipped 550 (actually, with the active cruise control we are talking $15K less)..

But, I do disagree that the BMW with runflats have a worse ride/handling balance than older BMWs - they were far superior IMHO.

 

Don't forget, guys, that a LOT ( perhaps a majority ) of the buisness in expensive cars is done through leasing, not buying, even in high-income areas like SoCal, NY, and DC-Baltimore. Leasing often allows someone to drive home a more expensive vehicle than he or she could afford in monthly payments for a purchase.

 

Agree to disagree. Very unscientific but the new 7 I drove recently had much better ride/handling than when I drove it when it first came out. The explanation given to me was that the second gen runflats are out and they are much improved over the first gen. It seemed to make sense but if true, I do not think any maker should have adopted them until they sorted the problems out.

I went to the SF auto show yesterday and Tuesday before Thanksgiving is a tradition for me. It tends to be a quiet day and you can spend some time with the cars. The crowd seems to be a bit more serious than on the holiday days. Overall, nothing much really impressed me. Bimmers are well known for hard seats but I never noticed it much when I owned them but darned those seats are downright uncomfortable to me now. They need to spend some time in a Volvo. This is very unscientific and personal opinion only so please take it for that. The bimmer booth had reasonalbe traffic but really appeared to be the usual crowd of nouveaux wannabes. The notion that the bimmer customer is status shopping was very apparent yesterday. Don't get me wrong, the people in the booth may have been able to quote every spec from the brochures on every model from bimmer and merc and the rest of the usual suspects. But overall, not the kind of people I feel like I want to spend much time with. And the bimmer salesmen manning the booth were just as arrogant as I remember. Still, they had a pretty good crowd. Nothing new with the cars IMO and nothing that really interested me.

Lexus had surprisingly little traffic in the show. The new GS is definitely not as impressive to me as the last gen GS was when you could sit in all of them side by side. There wasn't anyone looking at the GSs. The IS is a big improvement but just somehow not all that interesting. The two customers that I talked to in the booth were pretty typical. One guy was looking at the ES and knew it was the best value in its segment. Also just a darned nice car. But he is also going from an LS that he has owned since new to the ES so there is one guy who isn't interested in spending 60Kb anymore. The guy looking at the LS was an older guy fed up with Merc unreliability. By his accent, I would say he was German and was telling me and the Lexus salesman that current Mercs may be the worst cars made right now. I thought I had gotten fed up with bimmers. Looks like Merc is finally losing customers. They could be hard to get back.

Really didn't spend too much time in the Merc booth but there was little reason to. Obviously the driving experience is something that you can't compare at an auto show but with what you can compare, there is nothing in either Merc or bimmer to justify that price premium. The interiors and apparent build quality of both are barely competitive for their class IMO. Infiniti also didn't have much traffic but the M does come off very well. It might not have quite the feel of solidity of the GS but I know from driving it that it is much more to my liking than the GS. If I were serious in that segment, I would guess the M would be it. I don't know when the Q is going to be replaced but it needs to be very soon, they have one stuck off to the side and there is little reason to be interested in it. Audi still has nice interiors but no longer with the clear advantage they had years ago. Everyone has caught up, or mostly caught up. EIther way, they just don't stick out like they used to.

This has already gone on a bit too long but basically I was hard pressed to feel that the luxury brands are very hot from the show yesterday. The Hummer booth had more traffic than any of the luxury brands, including bimmer. I'll grant you the H1 and H2 aren't value buys but the H3 has a base sticker in the high 20s, maybe that explained it. Cadillac had as much traffic as any of the luxury brands. There was a couple in a DTS that looked like they were thinking of staying in it for the rest of the week. They were ex bimmer/merc owners and felt the new DTS was not only a better package but more stylish. Can't say I understand that but for the price (40s) it is a pretty good value. The only people in the Pontiac booth were looking at the Solstice and the GTO. Just not much reason to spend any time there. My guess is that the bloom is off the rose for the 300C/Magnum/Charger, no one really very interested in them. With ChryCos "Dub" styling, I don't think they are trying to get very mainstream buyers. Maybe that new Challenger will get the buzz going again. I guess the thing is that for an American sedan, they probably share with Buick for the best going. But it doesn't look like it is that difficult to get the 300C to the over 40K level, not SRT, just 300C. And that might be a tough sell going forward.

So there is a very non scientific view of the traffic at the auto show. Tuesday is a slow day but I have to tell you that the luxury brands just don't seem to have the traffic they had a few years ago. Audi A8s for 85K and 750s for 80K may just not have everyone very excited. Leases have a big impact on luxury brands, as pointed out, as the amount of wealth required to drive a car is lowered substantially with a lease. But you might also be able to raise a case that higher mortgage rates and a cooling housing market could have as big an effect. I suspect a lot of second mortgages went into the garage over the past several years. Once you "tap that equity" as the mortgage brokers love to advertise, it is gone. And if house appreciation softens, some people might actually figure they should wait to get a bimmer or merc or lexus until they can actually afford it. Not sure there is any point to this and luxury brands are not going to go away but they have always been about selling image more than functionality. And maybe we are coming up on a time when either the image they send is not the one people want to send or folks are just deciding that being able to avoid public housing in retirement is a better use of extra cash than what you park in the garage. Who knows? But I didn't hear anyone walking around trying to figure out where the bimmers were. But it was amazing the number of people that were looking for hybrids, from any manufacturer. Whodathunk?

 

Ron, you are correct. The new 550s are coming with Bridgestone's that ride/handle MUCH better than then Dunlops that were found on the 545s. I was in SF -just down the street from the show - on Friday as well. I just didn't realize the autoshow was going on then!

With regards to the BMW seats - kind of like a mattress IMHO. You really don't want an ultra soft one that you sink into. While it may feel comfortable, your body will make you pay for it after a couple of days. I think the BMW seats follow this mantra. I do know that the comfort seats I ordered in my 550 appear to be some of the most comfortable seats I have ever sat in.

 

Good write up on the SF show, RON, but the SF area IMO is not a real indicator or a good cross section of not only the national car market but especially the market for luxury and expensive vehicles. The SF area, like NYC, has traditionally been dominated by strongly anti-car and anti-SUV organizations, especially at Berkeley. Go down the coast to the L.A. show to get a much better indication of what is going on. More luxury and expensive vehicles are sold (and leased) in the SoCal and my own D.C.-Baltimore areas than anywhere else in the country.

 

You know that is a sort of bizarre statement about the SF auto market being dominated by the cities of SF and Berkeley. I am not sure where you get that from but I have never heard it before and not sure anyone here would support it. There are a lot of people living in the City that don't have cars, just like the downtown of a lot of big cities. And of course, Berkeley is just strange. But the south bay, which includes silicon valley, is very car oriented, luxury and non luxury. I can't think of anyplace where you see more bimmers per square block than here. Sometimes you honestly feel that bimmer outsells Toyota around here. I know I see more M3s than Solaras. I just spent a week in DC and I spend quite a bit of time in SoCal and don't think either of them has any greater luxury car orientation than silicon valley. The high tech biz may not be what it once was but I can go buy a Carrera GT off the dealers floor about ten minutes from where I work. They have three Carrera GTs in the showroom.

Be that as it may, it may have looked like I was trying to infer a conclusion on the national market from our local show and that would not be particularly valid. But my comments are based more on a comparison of this years SF auto show to previous SF auto shows. So from that standpoint, I think there is some relevance. Whether hybrids are as buzzy in other areas as here, I wouldn't know. There might be some validity to the notion that there are a higher percentage of people here that are willing to make the poor hybrid economic decision in order to make an environmental statement but there are a lot more liberal soccer Moms driving Range Rovers and LX470s around here than Prius's. That might have been the reason for the conversations I overheard about people looking for hybrids but gas is back down to the low 2s around here and the sputes and pickups are out in force again. Having been cut off not once, not twice, but three times by an airhead blonde in a burgundy Excursion chattering her brains out with the other soccer mom in the passenger seat while many smaller heads were in the back drove that point home to me last weekend.

If there is some validity to the auto show here it is from the fact that there has been an awfully lot of money floating around this valley. In other parts of the country, there are a lot of opinions voiced about cars but there are not many areas where people go out and spend as much on cars as around here. On one recent trip to Fry's to get an inkjet cartridge there were two guys comparing their F430s in the parking lot. Maybe DC or some other area has smarter auto consumers, around here it can often be easier to get more bucks than are justified by your intelligence or work ethic, but I would think we are not insignificant in the luxury or high end car market. As for LA, I spend a fair amount of time down there and lived there a while back but I still don't have a very good feel for what drives their market. Too big and too diverse. But I wouldn't draw conclusions about the national market from LA alone either. Once again, I think the comments just comparing this years SF show to previous shows was valid. I will leave it to others to draw the national conclusions. My analysis was just from going to that show for over twenty years and on the same day for about the last ten or fifteen years. I would obviously caution about reading anything meaningful into my remarks. There was nothing the slightest bit scientific about what I did, just making observations. Sure would be nice if the guys writing for the car magazines would put out the same disclaimers.

Doug - the only bimmer that is on my list is the 7. I had a chance to drive a new one a couple of weeks ago and the ride has improved quite a bit. My wife and I tried a 750 out at the show and there were some things we liked, it had a very interesting and flattering interior color, but man those seats are hard. I think they might have been more in place in a performance three series but for the 7 it just wasn't to my liking. That is just me and keep in mind I really didn't see anything that got me very interested in switching cars. I will wait to see the new LS next year and see what things look like after that. I have reread this a couple of times and I am sort of amazed that the Lexus booth left me with a big ho hum as well. My wife and I both have GSs and the new GS just doesn't seem viable to us. We would both be more inclined to go for an M than a GS. Surprising. After seeing the R class up close, it isn't on my list anymore and after chatting briefly with the guy about his awful time with mercs, I doubt the S will be on my list either. But it gets awfully difficult to put out 85 or 90 large for something that doesn't get your blood up. That comment isn't about bimmers so much as the show, and luxo end, in general. I know there are a lot of new models out but I came away waiting for next year. I think it is easier shopping at a lower price point. The new Buicks aren't at all bad and the Avalon is a nice piece as well. Subie's are still nice but they might have slid a bit this year. They had more lower end models and the interiors in the low end Subies are nothing special. The higher end interiors with leather were nice but it seems like there might be some cost cutting at work. None of them compares to Lexus or the usual luxo crowd, but very nice pieces. For some bizarre reason my wife found the H3 cute but she quickly admitted that there is no way she would own one unless she lived on a ranch and never had to take it anywhere in a city. The visibility in that thing is not exactly what you would want to take to the mall.

I am still not convinced that my basic premise about luxury car sales peaking has any validity to it. Obviously we like to get ourselves all screwed up in tight little ***** arguing the advantages of this or that lump of iron and aluminum but the truth is you are not paying for transportation with any of the things we typically talk about here. So we have a community of people where there are some of us that are willing to expend significant amounts of cash for autos that are not justified to get from A to B. Not just defend views but actually go vote with our checkbooks. And of course the underlying precepts are that you do feel the value is there and you can afford it. We have just been through an extraordinary time in the economy and the future of personal wealth or retirement realities may have as much, or more, to do with a cooling of the luxury car market as anything. But I just get the sense that there are now a lot of people that are deciding that the value in the branding is just not there. Or guys like the LS owner I talked to, his car is eight years old but just had its 60K service, who is now considering an ES rather than an LS. Maybe his economic situation changed but my sense is that he just has said that he wants the Lexus ownership experience but the ES meets his needs and he doesn't need to impress anyone with the LS. I guess we will see if there is more here than meets the eye. If we keep seeing ever increasing sales numbers on huge hp luxo vehicles, nothing has changed. But if Lexus wants to stay competitive, GS400 and GS300 need to come back but the numbers better be hp and not displacement.

 

I wasn't trying to discredit anything you said, RON...in fact I remarked that it was a good write up.
The point I was trying to make about the Bay City.....and I think you may have misunderstood it...was that it is like New York in many ways in terms of having both a strong pro-car and anti-car crowd at the same time. And I agree with you that Berkeley is strange. Los Angeles, though ( even though I don't live here ) from what I have seen seems to be more in the center of the country's car culture than any other area in the country. Yet Nissan, citing skyrocketing costs in the SoCal area, has chosen to move its company HQ to Tennessee to be closer to its plants there.

 

You know I am having a hard time keeping a handle on this thread myself. My sense is that there just is not as much emotion for the luxo brands as there was a couple of years ago but I have very, very little to support it. Here in the bay area the vast majority of focus is on SF and then to a far lesser extent Berkeley and that does kind of torque people off. San Jose is bigger than SF but it doesn't get the emphasis, probably rightly so. But the bigger point over any anti car bias, which I just don't see really, is the fact that the internet bubble didn't just pop, it got sucked into a black hole. With remarkably few exceptions like Google and a few others, the industrial base has collapsed and the high tech start up machine is gone, probably never to return. We now have business parks being plowed under and apartment complexes being put up. The startup machine is what had the ability to generate obscene amounts of income for people associated with the right firm and that is gone. I would postulate that the luxo car business will be impacted here.

When I bought my GS I went to San Diego to get it because I got it for almost $3K less. So I could visit Mom get the car, and still save quite a few bucks left over. And yes, I make a pretty fair amount of bucks but that doesn't make me interested in throwing it away if I don't have to. But now when I search on places like Carsdirect, I can get just as good a price on things putting in my local address as I could get shopping in other areas. So the luxo car dealers are dealing here and I doubt that is happening just because they decided it was a better way to do business. The local Lexus dealers were nowhere near as agressive on pricing as Penske in SD was when I got mine. Two years later when we got my wife's, it wasn't worth getting it outside the area. Today, I think we may actually be able to get a pretty good price. Now the reason for all this waste of bandwidth is that the local economy here is probably feeling the continuing downturn in the tech economy more than other areas. But I spend as much as half my time in DC and I sense a lot less interest in luxo brands there as well. I don't know how to put it in words but the passion or greed or whatever that was satisfied with the expensive car just seems to have died down a bit. Maybe I am just dealing with more grown ups.

As an aside, one of the people I saw in DC was going through their story with having multiple Acura transmissions replaced. I really didn't know about that problem with Acura's until reading about it here. So when I got back I called a friend of mine with a CL-S and sure enough, he had his go out as well. They claim to have made some fixes but he is trying to not abuse the tranny. When I asked him if he thought he was disenchanted with Acura he said no, he felt they had treated him pretty well. But he also added that he had no interest in getting another Acura just because he didn't think it was worth it anymore. I must admit, the crowd at the bimmer booth was the largest compared to merc, audi, lexus, and infinit but it still was not as big as the crowd at the Cadillac booth. And I am still trying to make sense out of this.

Of course, for fair disclosure, my wife and I went to see Harry Potter in Imax at the Metreon next to the auto show so maybe I am under some wayward spell. Happy Thanksgiving guys.

 

My take on why luxury vehicles may be losing some luster...

- Competition has given them SO many features (or 'things that can break') that consumers are overwhelmed - it's almost like they need a pilot's license to drive a 7 series for example.

- Competition in the lower markets has given everything power almost everything, tons of safety features and now a lot of models have heated seats, mirrors, navigation, cameras, sensors, etc, etc. So the so-called 'luxury vehicles' jam even more stuff into the vehicles.

I personally think 'luxury vehicles' should NOT be about adding more features unless they're completely seamless and maybe hidden. What is luxury? It means you feel rewarded and the experience is effortless. In a 10 year old Civic you feel neither. In a Bentley? You definitely feel both! The middle area is where traditional luxury vehicle makers have lost their way. They think more features is more luxury, when it seems a lot of the time instead of being rewarding and effortless, it's confusing (in design and function), often unreliable, and not rewarding.

I love gadgets but not if they're going to be confusing, unreliable, leave the rest of the experience lacking or just jack the price up off the charts.

That's what amazed me about my 2000 GS400 - lots of gadgets beautifully executed, extremely rewarding drive, the design both functional and beautiful, and it's been bulletproof reliable.

 

I HAVE a pilot's license ( with some instrument training )...and an aviation ground instructor's rating as well ....and the 7-series beats ME.