What makes a car luxury, and why the segment's leaders keep changing
No hard line separates a luxury car from a premium one; the label rests as much on a badge's image as on fine materials and careful assembly. Over a century, leadership has swung from pre-war European coachbuilders to Cadillac and Lincoln, then to German and Japanese makers, and lately towards Chinese electric newcomers.
Governments still try to pin the idea down. Australia has taxed expensive new cars since 2000, and in 2019 the threshold sat near AU$66,000, rising to about AU$76,000 for fuel-efficient models. Europe files such vehicles in the F-segment, while Germans call them Oberklasse, or upper class. Rental firms use Luxury and Luxury Elite codes but never publish what qualifies.
Engineering choices follow the brief. New safety and comfort features often debut on expensive models first, and suspensions usually favour a soft ride over sharp cornering. The classic front-engine, rear-drive layout costs more to build but fits big straight-six, V8 and V12 engines. After the 1973 embargo and the 1979 oil crisis many American luxury models moved to front-wheel drive, returning to rear drive from the early 2000s, and since the Bentley Continental GT of 2003 more grand tourers send power to all four wheels. Some brands will even strip model badges for buyers wary of looking flashy.
The 1920s and 1930s were the peak for enormous custom-bodied cars. After the war French tax rules pushed makers towards small engines, so the Citroën SM and C6 were arguably the country's last homegrown luxury cars until Citroën launched DS Automobiles in 2014. BMW went from aircraft engines to motorcycles and licensed Austin small cars before buying Rolls-Royce Motor Cars in 1998. In America, Cadillac outsold every luxury rival from 1946 until the late 1990s, and in 1990 Lincoln enjoyed its best year with 231,660 cars.
Asian makers then reshaped the field with separate marques: Honda's Acura in 1986, Toyota's Lexus and Nissan's Infiniti in 1989, and Hyundai's Genesis in 2015. China's Hongqi dates from 1958, joined by electric-era labels such as Nio in 2014, Zeekr in 2021 and Yangwang in 2023. The 2008 crash hit the segment harder than any slump since the Great Depression, yet cheaper entry-level models held up, and several brands set Canadian sales records in August 2009.
Source: Luxury car
