When Lee Victorian was looking for an upscale car to complement his wife’s BMW last year, he was leaning toward an Audi A6 — a sedan whose acceleration, refinement and dazzling array of advanced technologies, like automatic braking and radar-based cruise control, he found alluring.
But what he drove off the lot was an entirely different kind of premium vehicle, and one more luxury buyers are choosing: a pickup truck.
Victorian, a retired Michigan state trooper, bought a Raptor version of the Ford F-150. The Raptor is a truck with the soul of a race car: It has a 450-horsepower engine, a 10-speed transmission, electronic ride settings for seven road surfaces, big chrome wheels, a power tailgate, cameras at all four corners and an adaptive cruise control system similar to the Audi’s. With all those options, the sticker price came to about $80,000.
“Man, this truck is so slick,” Victorian said. “I stop at a light and people give me the thumbs up and take pictures of it. The truck is the celebrity.”
For the last few years, the auto industry has been roiled by a significant shift in consumer tastes. In droves, Americans are turning their backs on family sedans and small cars and flocking to bigger, roomier models like SUVS and trucks. In January, two of every three new vehicles sold were classified as trucks, including SUVs, pickups, minivans and the lighter cousins of SUVs known as crossovers.
Now a new dimension to this trend is emerging: Even upscale buyers who long favored Lexus, Cadillac, Jaguar and the German luxury brands are gravitating to trucks and SUVs. What they are buying are often special-edition, fully loaded models, like Victorian’s Raptor, that sell for as much as or more than BMW’s flagship 7 Series sedan.
“We are seeing it,” said Tom Libby, an auto industry analyst at the research firm IHS Markit. “There is movement from luxury cars to luxury trucks.”
General Motors’ GMC brand — which sells only trucks and SUVs — accounted for 11.3 percent of domestic sales of models with an average price of $60,000 or more in 2017, according to data from Edmunds.com. Five years earlier, the brand made up a mere 0.1 percent of those sales.
Ford and Chevrolet saw similar but smaller jumps, driven by increasing high-end truck and SUV sales. At the same time, the portion of over-$60,000 sales for luxury brands including Porsche, Mercedes-Benz, Lexus, Jaguar and Cadillac shrank.
That is providing a tail wind for the Detroit automakers when overall new-vehicle sales in the United States are slowing. General Motors, Ford and Fiat Chrysler, with its Jeep brand, dominate in trucks and SUVs, and now they’re scrambling to roll out more high-end versions.
It’s a competitive — and crucial — segment. With demand for cars shriveling, the Detroit three and even some foreign manufacturers acknowledge they are losing money on many of the cars they sell. But a $60,000 truck can generate tens of thousands of dollars in operating profit.
At a recent investor conference, GM outlined a plan to produce more of the pricey Denali versions of GMC SUVs and trucks. The company showed data indicating that the Denali line had an average sale price of $56,000 — more than the average price of a BMW, a Mercedes-Benz or an Audi.
“This thing,” GM’s president, Dan Ammann, said of the Denali line, “is a money machine.”
The other Detroit carmakers are heading in the same direction.
In October, Ford began making new versions of its eight-passenger Ford Expedition and Lincoln Navigator full-size SUVs, and already has decided to make 25 percent more this year than it originally planned. In January, Navigators sold for an average of $77,000, thanks to strong sales of the top-of-the-line Black Label edition.
Fiat Chrysler is preparing to add more Jeep models, including a pickup and a full-size Grand Wagoneer.
In 2017, SUVs and crossovers made up 41 percent of the market in the United States, up from 30 percent in 2013, according to Autodata. Luxury cars have gone in the opposite direction: They made up 5.4 percent of the market last year, down from 7.5 percent four years earlier.
And the priciest SUVs and trucks are selling fastest. The high-end Lariat, King Ranch and Raptor models make up more than half of all F-150 sales, up from one-third a few years ago. Denali editions account for 29 percent of GMC’s sales, up from 21 percent.
Low gasoline prices are one reason that sales of high-end trucks are rising. Years ago, pickups and big SUVs often traveled only 11 or 12 mpg of gas. Today, their fuel economy is often double that.
“The complaint that SUVs are horrible on gas is not such a roadblock anymore,” said Mark Scarpelli, owner of two Chevrolet dealerships and a Chrysler-Dodge-Jeep franchise in Illinois.
At the same time, automakers have appointed special-edition SUVs and trucks with the same kinds of advanced technologies and comfort features that consumers once found only in luxury cars. Want an interior trimmed in African mahogany? You can get it in the Black Label Navigator. Want an SUV that accelerates like a Porsche (and isn’t a Porsche)? Try the Jeep Grand Cherokee Trackhawk and its 707-horsepower V8.
Chuck Ducher, a retired school psychologist in Onsted, Michigan, just bought an F-150 Lariat with a bevy of options, including heated rear seats. “I can put my mother back there, and she’s in heaven,” he said. “There’s no doubt in my mind this is a luxury vehicle.”
Wes Lutz, owner of a Chrysler-Dodge-Jeep dealership in Jackson, Michigan, said he was surprised at the way customers were snapping up the most expensive models on his lot. This month, he had two Trackhawks this month, each with a sticker price of $93,000.
“They won’t be here more than a few weeks,” he said. “It’s incredible. We never used to play in that price range.
Increasing competition from upmarket SUVs and trucks is adding to the struggles of the luxury makers. Most have long relied on cars for the bulk of their sales, and are suffering now that bigger vehicles are in favor. In 2017, for example, BMW’s sales to individual customers at dealerships in the United States fell more than 5 percent, according data shared among automakers. The decline in BMW’s total sales was less because of a big jump in sales to rental car fleets, a type of customer that luxury brands tended to shun in the past.
Out in Tacoma, Washington, Gary Gilchrist sees the trend just about every week at his GMC dealership.
“We’ve been taking in Lexuses on trade-ins, BMWs,” he said. This month, he said, a customer turned in a 2012 BMW 550i and bought a $71,000 GMC Sierra Denali pickup.
“People used to want German cars for the image factor,” Gilchrist said. “Now, if you have a Denali, you get that. People turn their heads to look.”