If you have ever spent time wondering why there are significantly more high-end cars on America’s roads than there were a generation ago, and how people can possibly afford them, it appears this trend is merely in its early stages.
A new comprehensive analysis of the U.S. luxury and exotic car sector indicates that the market for expensive vehicles, currently valued at approximately $110 billion, could expand to between $180 billion and $215 billion by the year 2035. This growth will depend on the evolution of demand and inventory trends.
These findings come from a study conducted by the Boston Consulting Group (BCG) and duPont Registry Group, which tracks how high-end purchasing habits are currently shifting.
The study forecasts the most robust growth in the segment of new and used vehicles priced between $100,000 and $170,000, where annual sales are projected to increase by 6 to 8 percent.
The ultra-luxury and hyper-luxury categories above that price point ($170,000 and above) will continue to grow, though at a notably slower pace.
This may be because even the wealthiest individuals in America have a finite amount of garage space for multi-million dollar specialty vehicles.
The most substantial surge is anticipated within the pre-owned vehicle market. Bolstered by strong resale values and the fact that luxury cars do not depreciate in the same manner as ordinary vehicles, pre-owned exotic cars are projected to grow up to one and a half times faster than new models over the coming decade.
To be specific, sales of used luxury and exotic vehicles are forecast to grow by approximately 5 to 8 percent each year, compared to a growth rate of about 5 to 6 percent for new cars.
Buyers who may be reluctant due to the increasing prices of new luxury cars are often willing to purchase a gently used model. The report notes that these high-end used cars change ownership frequently because their appeal diminishes very little over time.
This luxury car expansion is also being driven by a new generation of consumers who shop in a vastly different way from traditional buyers.
Millennial and Gen Z shoppers browse inventory listings constantly, compare a wider range of brands, and demonstrate far less loyalty to the customary, long-established market leaders.
In fact, about 80 percent of luxury car buyers report that they browse for vehicles online on a weekly or even daily basis, frequently without any immediate intention to make a purchase.
They are also significantly more receptive to the digital purchasing process, with three out of every four luxury buyers stating they would consider completing their next car purchase entirely online. For dealerships, this prospect is both thrilling and somewhat daunting.
The report reveals that the high-end automotive market remains notably resilient, despite concerns over rising interest rates, inflation, and tariffs. Even the transition to electric vehicles is not expected to disrupt this trend, although younger buyers express greater interest in electric luxury models than older demographics.
Across all age groups, emotion is a key factor, with roughly one in three buyers identifying an emotional connection to a brand or its design as the main reason for their vehicle choice.
While curated experiences are now nearly as important as the cars themselves, the fundamental excitement of driving remains a central motivation for spending lavishly on these machines. Indeed, more than 90 percent of buyers report that brand-hosted events and driving programs increase their satisfaction with ownership.
The notion of spending a six-figure sum on an automobile remains a mere fantasy for many Americans who are finding it difficult to afford a new vehicle costing $30,000. However, if the projections are accurate, the next ten years will witness a greater presence of exotic cars on American roads than ever before.
Eventually, those cars will depreciate to a point where individuals with average spending power can participate in the market. At least, that is what we would like to believe.
