Electric car: what’s left for the premium?

Electric cars are often efficient and well equipped. How can we still justify the cost of luxury in this new situation?

Part of the production and marketing of vintage cars was built on the dream and hope that the unaffordable would become available. Or not. This is how many brands were born and their image is now directly linked to performance and its consequence is luxury.

With “pure players” on one side, in other words niche manufacturers like Ferrari, Lamborghini, McLaren and to some extent Porsche (to some extent, because Porsche doesn’t just build ultra-exclusive sports cars). Basically Italian, German or English brands.

And on the other hand the general manufacturers who have been able to carry out – not without some success – the development and marketing of general lines and luxury/sport lines. Among the most famous are again “premium” stars, almost exclusively German, such as Mercedes, BMW or Audi. With this winning trio, we can also associate other big names such as Volvo, Jaguar or the Japanese Lexus and Infiniti.

That is, the established brands, among which some statistics and market share specialists have now added a new addition: Tesla. I know, there is a discussion. If we take the standard equipment, the prices of the Model S or the performance of the Model 3 Performance, we are clearly in the premium category. Finish, paint and assembly qualities are still a long way off, although the latest versions of the brand’s cars show some pretty spectacular progress in these areas.

If we want to see it a little more clearly, let’s say that a high-performance car is not necessarily a premium car, and that, conversely, a premium car is not necessarily a sports car. That being said, a premium is rarely separated from a specific power.

The electric car is aimed at the premium market

In all cases, the motto is the same: faster, stronger, chic. And more expensive.

But there is a small problem.

This issue is titled: electric car. If for purists and lovers of big thermal engines that roar at the bottom of the plains in the evening (I am one of them, er, was), electric can never be synonymous with “premium”, it would not be which in the emotional meaning of the term it turns out that in fact many battery powered cars currently on the market meet this definition.

In fact, the BMW i4 or i5, Mercedes EQE or EQS, Porsche Taycan or Audi e-tron GT have nothing to envy their thermal sisters. Worse, they not only perform equally well in terms of production quality, but often perform better in terms of performance. Which can cause some ego problems and shake up some hierarchies.

So, in order not to dethrone the queen 911 Turbo, we at Porsche have managed to ensure that the most efficient Taycan remains only a few tenths lower in terms of acceleration. And it costs about that much. But we do know that it might not take too long, and that it would be fairly easy to get the electric beast to evolve to drop below 2.5 seconds in practice 0-100.

One of the most prominent examples can be found on the side of Tesla and Porsche. If you want to find an electric Porsche that has the performance equivalent of a Tesla Model 3 Performance, you have to look for the Taycan Turbo. Base price: 167,840 euros, to which it will easily be necessary to add 25,000 euros of options to achieve approximately the same level of equipment and services (and again without cameras, without autonomous driving and with less autonomy).

Which gives us a small 192,000 euros, a good weight if we want to round up. While a fully optioned Model 3 Perf traded for less than €70,000 with all options included when it was still in the brand’s catalog. You see the gap, don’t you, the chasm? So yes, I know, I’m comparing a Swatch bought in a leek and roast chicken market to a Place Vendôme bought Rolex.

But what, the coat of arms is expensive, anyway.

Vain? Not so much. Premium enthusiasts love luxury, performance and exclusivity. And show off a bit. Or at least “status”. And it is often thanks to this exclusivity that brands that can handle it achieve the best margins. Which then allows them to reinvest in Mr. Toutlemond’s car, in addition to being crowned with the image and aura of their most effective models.

Because if the premium segment – even if it is difficult to establish an exact definition – it “only” represents 440 billion euros for all premium brands out of 2000 billion for only the top 16 global manufacturers (data from 2021), it continues to sell well even in the economic slowdown, and above all, the margins are much more comfortable.

Electricity is therefore a real problem for luxury brands. And not only among exclusives. Check out the quality of service on the Cupra Born or small Volvo EX30, not to mention the feats of the latter… In fact, on the strength side, it is called mass.

Given the ease with which it is now possible to produce small, high-torque, kilowatt-filled electric motors that accelerate MG4 as strong as the Porsche 911, the premium battle will have to be fought elsewhere, on different foundations, probably new and more refined.

Especially when the trend towards vegan minimalism in terms of interior design is de facto ruling out Airbus-style cockpits clad in full leather.

Promoting heritage in the face of imageless brands

Therefore, for the premium, the problem of electric competition on its own land, but also the problem of positioning on the market. Because by observing the weak signals, we rather have the impression that the market for electric supercars (in a very broad sense) simply does not exist. Or not yet.

The rich big-cavalry enthusiast continues to buy what’s left of the thermal bi-turbo V6 V8 V12 range, while the electric enthusiast seeks sobriety and practicality, far from anything that may be associated with outward signs of wealth. Two quite irreconcilable worlds, in fact.

So, what is left for the premium to try to attract commuters with a well-stocked wallet, or convert supporters of degrowth to the pleasure of luxury? Some segment brands because they say the devil is in the details.

Probably the prestige of the brand, its history, a certain know-how. And also a narrative that will continue to appeal to lovers of fine mechanics in a world where new generations are turning away from cars and have no use for the codes and showmanship inherent in this world.

In this new challenge, it could be that the Europeans have a real card to play against the Chinese brands, which are certainly attractive, but ultimately very bland and without any emotional dimension.

Until we forget their DNA and turn our backs on their history.

Leave a Reply

Your email address will not be published. Required fields are marked *