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Europe Luxury Car Market Size (2024 - 2029)

The European luxury car market is experiencing a dynamic shift, with its market size projected to expand significantly over the forecast period. Despite the initial setbacks caused by the COVID-19 pandemic, which led to reduced production and sales, certain luxury brands have managed to thrive. The increasing appeal of luxury cars, particularly among millennials, along with the growing demand for electric mobility and comfortable driving experiences, is driving market growth. The SUV segment, characterized by its flexibility and enhanced driving experience, is also contributing to the market's expansion. Key countries like Germany and the United Kingdom are expected to play a crucial role in this growth, supported by strategic initiatives from major players in the industry.

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Market Size of Europe Luxury Car Industry

Europe Luxury Car Market Summary
Study Period 2020 - 2029
Base Year For Estimation 2023
CAGR 9.00 %
Fastest Growing Market Europe
Largest Market Europe
Market Concentration Medium

Major Players

Europe Luxury Car Market Major Players

*Disclaimer: Major Players sorted in no particular order

European Luxury Cars Market Analysis

Currently, the European luxury car market is valued at USD 157.3 billion currently and is expected to reach USD 229.25 billion over the next five years, registering a CAGR of 9% during the forecast period.

The COVID-19 pandemic has negatively impacted the market as lockdowns and shutdowns of manufacturing facilities of major OEMs resulted in a decrease in production and sales of luxury cars across the region. However, a few luxury brands, such as Porsche, Lexus, and Jaguar, registered increased sales in Q1 2020 compared to Q1 2019 owing to ease in restrictions post-pandemic. Moreover, according to the Society of Motor Manufacturers and Traders (SMMT), UK passenger car sales decreased by 14.3% to 243,479 units in March 2022. Year-to-date sales decreased by 1.9%, with 417,560 cars registered in the first three months of 2022.

Over the medium term, growing awareness about the benefits of luxury cars and the attractive appearance of the vehicle is encouraging high millennial youth, and such factors are expected to propel demand in the market. Increased demand for a comfortable driving experience and growing penetration of electric mobility is anticipated to contribute to rising luxury car adoption over the forecast period.

Some of the reasons for the rise of SUVs include flexibility, payload-carrying ability, driveability, commanding view from the driver's seat, and ease of cabin access. Most of the latest SUVs come under the crossover category, which are larger, more bulbous cars rather than the pickup truck-based sports utilities. Several European luxury car launches have taken the segment to witness elevated sales bar. For instance, in May 2022, Hyundai announced that it would soon launch three Genesis luxury EVs in the European market. The company's flagship premium genesis G80 and SUV GV80 were expected by the end of June 2022 in Europe.

Germany, the United Kingdom, and several other key countries are expected to have a prominent role in the market owing to rising developments by key players across the country and their strategies, such as expansion, product launches, and others.

European Luxury Cars Industry Segmentation

A luxury car provides increased levels of comfort, equipment, amenities, quality, performance, and associated status compared to moderately priced cars. The European luxury car fleet includes high-range cars that provide excellent comfort and carry the most reliable design and material. Players, including Porsche, Ferrari, BMW, and Mercedes-Benz, are carrying dominating hands in selling these luxury cars.

The European Luxury Car Market is segmented by Vehicle Type (Hatchback, Sedan, Sport Utility Vehicles, and Multi-Purpose Vehicles), Drive Type (IC Engine and Electric), and Country (Germany, United Kingdom, France, Spain, Italy, Russia, Netherlands, Denmark, Sweden, Belgium, Switzerland, and Rest of Europe). The report offers market size and forecast for the Europe Luxury Car market in Value (USD billion) for all the above segments.

Vehicle Type
Hatchback
Sedan
Sport Utility Vehicle
Multi-purpose Vehicle
Drive Type
IC Engine
Electric
Geography
Germany
United Kingdom
France
Spain
Italy
Russia
Netherlands
Denmark
Sweden
Belgium
Switzerland
Rest of Europe
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Europe Luxury Car Market Size Summary

The European luxury car market is experiencing a dynamic transformation, driven by evolving consumer preferences and technological advancements. The market, currently valued at a significant figure, is poised for substantial growth over the next five years, with a notable compound annual growth rate. The COVID-19 pandemic initially disrupted the market, causing a decline in production and sales due to lockdowns and manufacturing shutdowns. However, the easing of restrictions has led to a resurgence in demand, particularly for brands like Porsche, Lexus, and Jaguar. The market is witnessing a shift towards SUVs, which are becoming increasingly popular due to their flexibility, spaciousness, and enhanced driving experience. This trend is supported by the growing penetration of electric mobility, as consumers seek more sustainable and luxurious vehicle options.

Germany and the United Kingdom are key players in the European luxury car market, with significant contributions from major automotive manufacturers. The German automotive sector, known for its innovation and high-tech products, continues to be a backbone of the industry, with substantial investments in research and development. The preference for SUVs is evident, with brands like Nissan, Hyundai, and Porsche leading the charge. The market is also seeing collaborations between luxury car manufacturers and technology suppliers to enhance vehicle features and sustainability. The introduction of electric and autonomous vehicles is further propelling market growth, with companies like Audi and BMW launching advanced models. As the demand for luxury cars continues to rise, the European market is expected to maintain its dominance, driven by strategic expansions, product launches, and technological innovations.

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Europe Luxury Car Market Size - Table of Contents

  1. 1. MARKET DYNAMICS

    1. 1.1 Market Drivers

    2. 1.2 Market Restraints

    3. 1.3 Porter's Five Forces Analysis

      1. 1.3.1 Threat of New Entrants

      2. 1.3.2 Bargaining Power of Buyers/Consumers

      3. 1.3.3 Bargaining Power of Suppliers

      4. 1.3.4 Threat of Substitute Products

      5. 1.3.5 Intensity of Competitive Rivalry

  2. 2. MARKET SEGMENTATION (Market Size in Value - USD Billion)

    1. 2.1 Vehicle Type

      1. 2.1.1 Hatchback

      2. 2.1.2 Sedan

      3. 2.1.3 Sport Utility Vehicle

      4. 2.1.4 Multi-purpose Vehicle

    2. 2.2 Drive Type

      1. 2.2.1 IC Engine

      2. 2.2.2 Electric

    3. 2.3 Geography

      1. 2.3.1 Germany

      2. 2.3.2 United Kingdom

      3. 2.3.3 France

      4. 2.3.4 Spain

      5. 2.3.5 Italy

      6. 2.3.6 Russia

      7. 2.3.7 Netherlands

      8. 2.3.8 Denmark

      9. 2.3.9 Sweden

      10. 2.3.10 Belgium

      11. 2.3.11 Switzerland

      12. 2.3.12 Rest of Europe

Europe Luxury Car Market Size FAQs

The Europe Luxury Car Market is projected to register a CAGR of 9% during the forecast period (2024-2029)

BMW AG, Tesla Inc., Mercedes-Benz Group AG, Audi AG and Volvo Cars are the major companies operating in the Europe Luxury Car Market.

Luxury European Cars Market Report Snapshots

European Luxury Cars Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)