ATLANTA — Mercedes-Benz got off to an early lead over rival BMW in the 2020 U.S. luxury sales race.
Mercedes delivered 67,746 vehicles, excluding commercial vans, in the first quarter, down 4.8 percent from a year ago.
BMW sold 59,455 vehicles in the U.S. in the first quarter, down 15 percent from the same period a year ago.
While the overall auto industry took it on the chin in the first quarter as sales cratered since mid-March, premium brands were especially hard hit.
U.S. luxury sales, excluding Jaguar Land Rover, tumbled 13 percent in the first quarter as the segment’s biggest markets are among the hardest hit by the coronavirus pandemic.
New York, Los Angeles and San Francisco, major U.S. luxury sales hubs, have been in lockdown for weeks.
With showrooms shuttered, premium nameplates have ceded 2.7 percentage points of market share in recent weeks, according to J.D. Power.
But amid the gloom lurks hope.
Leasing accounts for a majority of luxury transactions — 57 percent in 2019, said Tyson Jominy, vice president of the Power Information Network at J.D. Power
“Lessees may extend their current payments for a month or two, but they can’t stay out of the market indefinitely,” Jominy said. “Will we have a blowout Memorial Day, or will it be Fourth of July? It’s too soon to know, but it’s coming.”
In the luxury segment, Lexus trailed the leaders. The Japanese brand’s U.S. sales tumbled 16 percent in the first quarter to 56,345.
Audi’s deliveries dived 14 percent to 41,367; Cadillac rounded out the top five with 30,325 sales, down 16 percent from a year earlier.
Stock market volatility in the wake of the pandemic also hammered luxury sales.
Mercedes and BMW clientele are typically heavily invested in the stock market, said Sam Fiorani, vice president at AutoForecast Solutions.
“A 10 percent or 15 percent drop in the Dow is like Punxsutawney Phil seeing his shadow on Groundhog Day,” Fiorani said. “It will scare those dollar bills right back into their wallet.”
The luxury sales race will be interesting to watch this year.
BMW last year ended Mercedes’ three-year streak at the top thanks to a wave of new product, led by the BMW X7 large crossover.
Mercedes, however, has a head start this year and is likely to keep up the pressure with its own product offensive. Mercedes volume leaders in the first quarter included the GLC, GLE and E-Class model lines.
“We are not counting Mercedes-Benz down for long,” BMW National Dealer Forum Chairman Patrick Womack told Automotive News in January. “Over the next two years there will be strong competition.”