Cutting Back: Wealthy Car Buyers Trading Down
By Phil LeBeau, CNBC Correspondent
NEW YORK (CNBC) -- Call it a sign of the wealthy in America being a little more cautious. Or call it a case where high-end car buyers are trading down so they don't spend as much for luxury cars and SUVs. Whatever you call it, it is clear sales of new models costing more than $75,000 have slowed down.
J.D. Power's Power Information Network has tracked sales for the first half of this year and broke them down based on the transaction prices. In other words, what did customers actually pay before they drove off the lot.
According to J.D. power, here's the data:
Under $25,000 (up) 8.3%
$25,000-$49,999 (up) 14.5%
$50,000-$74,999 (up) 19.1%
Above $75,000 (down) 3.7%
Industry: (up) 11.5%
Wealthier Customers Trading Down After getting the data, I called a number of dealers around the country to get a sense of why sales of higher-end luxury vehicles have slowed.
Dealers say their customers are still buying luxury cars and SUVs, but instead of paying $75,000 or $85,000 for a particular model, they are moving down and buying a similar model but for $10,000 or $20,000 less.
For example, look at sales of the Audi A8, A8L and S8 Quattro. In the first half of this year, sales of those cars are down 11.8% according to Autodata. By comparison, Audi sales overall are up 15%, outpacing the industry.
Another example is the Mercedes E Class. So far this year, retail sales of the E Class are down 5.7% while sales of all Mercedes brand models are up 16.8%, again growing faster than industry sales.
Finally, there's the Lexus LS 460. According to Autodata, LS 460 sales this year are down 28.9%, but Lexus sales overall are up 21.3%.