Automakers are upgrading their choices to satisfy demand for high-end choices

“Every new car is a luxury purchase”

Part of the problem is that more Americans want expensive SUVs and full-option pickups, which can cost up to 40% more than the base price, he added.

Over the past decade, luxury buyers have repeatedly demonstrated their willingness to spend more on quality cars and the financing that goes with them.

Even the smallest upgrades have met with increasing demand, Drury said, citing the extreme excitement about the Honda Odyssey’s built-in vacuum option when it was first unveiled in 2014.

Different packages or trim levels offer a range of features intended to appeal to different buyers, such as improved safety features, larger engines or higher-end finishes like leather seats and a better stereo.

Now everyone wants high-tech touchscreens, ambient lighting, 360-degree cameras, and heated and cooled seats, Drury said, which cost even more. “Fewer and fewer people want something basic.”

Since the lucrative luxury segment is in high demand, car manufacturers are upgrading their product range and cutting back on cheaper cars.

“While base models are theoretically tempting, they rarely make it onto the road,” said Drury. “Every new car is currently a luxury purchase.”

“Who do you blame: the consumer who buys these options, the dealers who order these cars, or the automakers who make fewer base models?” he said.

As more people are priced out of the new-car market, automakers may start testing cheaper alternatives, he said, although if consumer interest is high, it could also push up the price of those models.

Right now, the best way to get a base model vehicle is to order it directly from a dealer, Drury advised.

“There could be a perfectly good replacement for about half the cost,” he said.

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