Automotive production

Seven Reasons Why People Buy Luxury Cars

Nowadays more and more people gravitate towards luxury car brands. We‘ve thought about reasons why people buy luxury cars, because in addition to the purely material side (I have money, so I will buy), there are other motives – intangible ones.

The luxury car segment is relatively small but highly lucrative. To increase sales, luxury vehicle manufacturers should understand which basic factors urge purchasers in this sector. Given that some modern mainstream cars are functionally identical to higher-priced models and differ only in details and the way the vehicle is positioned, the question arises:

Why are people willing to pay for a luxury model instead of buying a similar but cheaper one?

There are at least seven reasons why people buy luxury cars, according to Limelight: perceived value, higher status, self-esteem, passion, consumer experience, build quality, and exclusivity. Now a few words about each.

Perceived Value

The perceived value (PV) is a customer’s own perception of a product’s merit or desirability to it compared to a competitor’s product. PV is measured by the price the public is willing to pay for a good.

The perceived value of luxury brands is normally higher than that of non-luxury brands, and consumers are ready to pay more for a vehicle when they feel that its price reflects the value they’ll get in return.

High Status

A luxury vehicle means high status for the buyer: it is not just a car – it is a symbol of well-being. So, while utilitarian vehicles are bought by necessity, luxury cars are purchased by those for whom material wealth and social status are important things. Buyers of luxury vehicles have hedonistic motivation, as owning expensive prestigious cars elevates them to a higher class on the social scale.


Some people choose a luxury brand to boost their self-esteem or because they perceive the car as a status symbol that helps increase confidence. This is a kind of compensatory consumption when the desire for luxury is caused by negative experiences or psychological threats in the past which affected the person’s ego.


There are engrossed customers for whom an automobile is not just a means of transportation to get from point A to point B, but a hobby, a passion.

Buyers of this type pay close attention to every aspect of a luxury car: they are knowledgeable consumers of various automotive content and attendees of automotive events. Such purchasers satisfy their feelings of gratification and pleasure through luxury vehicles.

Consumer Experience

A concept of luxury covers more than the product’s quality: it also sets an expectation of a better consumer experience. The majority (54 percent) of those surveyed by Autotrader said they would prefer a dealership offering a superior experience over the one with the lowest price.

Build Quality

A piece of advice to look for a luxury brand if you want the best-in-class vehicle is quite reasonable. Indeed, luxury car brands offer better build quality than competitors, they often excel at engineering and high technologies.

Premium prices make it possible for luxury automakers to use high-end finishes, materials of better quality, and innovations.


It’s nice to own something special and limited that others don’t have. It’s so invigorating…The luxury car market sets a high barrier to entry for an average customer, which makes it a closed club that not everyone can join. Exclusivity is what adds to the value and desirability of a luxury vehicle.

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