Are there enough rich to buy super-rich cars?

Over the next few years, European automakers will begin building the automotive equivalents of Faberge eggs. Their mission: to find the spending limits of the world's wealthiest people.

Among the offerings will be opulent newcomers such as DaimlerChrysler's Maybach and Mercedes-Benz's SLR, BMW AG's Rolls-Royce and Volkswagen AG's Bugatti Veyron. Each will be priced at least e300,000, or about $275,000. The cars will redefine an ultra-prestige segment that has changed little over the past half century.

At the same time, Aston Martin plans to triple its numbers; Maserati talks of a fivefold increase in volume; Bentley of a sixfold expansion; and Lamborghini of a tenfold jump - all by the middle of this decade.

More competition

If that were to happen, big BMW and Mercedes-Benz models with V-12 engines would be passe.

The intense product development activity and market planning are such that other automakers face being left behind in terms of technology and, more important, public perception.

Can Toyota Motor Corp., one of the world's wealthiest and most admired automotive companies, ignore what is happening? Its Lexus brand is a winner in North America but has failed to make much of an impression on European consumers.

And what of Jaguar, part of Ford's Premier Automotive Group of luxury brands? Speculation is that the top-secret concept car it plans to unveil at the Frankfurt auto show this month will be a Jaguar-based Daimler limousine designed for heads of state - a type of vehicle once made by the company.

Defining the market

Defining the ultra-prestige segment is an imprecise business because the companies involved have different measures. In simple numerical terms, extremely pricey cars don't account for much in an automotive sector that last year consumed 39.5 million new cars.

What characterizes the models and gives them a public profile far higher than their actual significance is price. It certainly is not vehicle type. The Rolls-Royce Silver Seraph, Lamborghini Diablo and AM General Hummer have only one thing in common - huge sticker prices. A Porsche GT2 is in, but an entry-level 911 is arguably out.

Nevertheless, when automakers are investing for segment growth from 33,000 units globally to more than 55,000 over a five-year period, the question is: From where will all those additional buyers come?

Many wealthy people

Even the collapse of the phenomenon, which wiped out plenty of potential customers, did not affect automakers' strategies. No super-premium automaker has backed away from its plans, said Nigel Griffiths, European automotive analyst at DRI-WEFA in Wimbledon, England.

"There are still a lot of technology millionaires," he said. "The premium brands have still done very well since that bubble burst. Demand for them in the U.S.A. is at record levels."

That belief is supported by the experience of Aston Martin, which delivered the first of its e250,000, or about $225,000, Vanquish coupes this month.

"We've sold the next two years' Vanquish production - 500 cars gone in three months," said Aston Martin spokesman Tim Watson.

But John May, founder of World Automotive Industry Trends in Staffordshire, England, warns: "It will be relatively easy to find those buyers once, but what about the following years?"

Research by Merrill Lynch and Cap Gemini Ernst & Young suggests that will not be a problem. The latest edition of their joint World Wealth Report says the number of what they call high-net-worth individuals grew by 2.9 percent last year to almost 7.2 million, in spite of drops in most of the world's equity markets. The firms define high-net-worth people as those with investable assets of at least $1 million, excluding real estate.

The report also says the number of ultra-high-net-worth people worldwide - those with investable assets of more than $30 million - increased 3 percent to an estimated 57,000 at the end of last year. That is roughly the same as the planned annual output of all ultra-prestige car projects now under way.

You can reach Richard Feast at

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