Sales of the four best-selling cars in the class – Audi A8, BMW 7-series, Jaguar XJ and Mercedes-Benz S-class – have fallen by 25% in the past five years, compared with a 50% growth in the prestige market as a whole.
As a result, the average residual value of a one-year-old luxury car with 12,000 miles on the clock is 57% of cost new, compared to 67% last year – a fall of 10 percentage points. This figure compares with an average RV of 70% for a smaller prestige car such as an Audi A6 or BMW 5-series, and 73% for SUVs such as the BMW X5 and Mercedes-Benz M-class.
Richard Crosthwaite, prestige car editor at Eurotax Glass’s, said: ‘There is much more choice in the market than ever before, and many traditional luxury car buyers are migrating to prestige-brand SUVs and niche coupe models. We’re also seeing new luxury cars from the likes of Aston Martin.
‘There has been a sea-change in attitude towards the traditional big saloon. It is not as desirable as it once was, has higher running costs than some of its alternatives and buyers are more aware of the high levels of depreciation.’