New mobility shifts the metrics for luxury segment success

Luxury vehicles are a lucrative segment and offer automakers not only significant margins but also an early launchpad for innovative technology. Historically the segment has stood out from the crowd with superior craftsmanship, design, reliability, and exclusivity. But change is underway, and what constitutes a luxury vehicle is evolving in the wake of urbanisation, connectivity, and sustainability trends.

“Traditionally, luxury cars were either fast or extremely well equipped,” says Michele Bertoncello, Partner at McKinsey. “Speed was generally the defining factor for success in this segment, but I would argue that this has changed. Brands now need to redefine the metric for luxury success.”