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Who Schooled Who? In The High End SUV Market for 2006?

Agent009 submitted on 02/22/2007 Official AutoSpies Timestamp: 2:20 PM
from: www.autospies.com

[78] user comments | category: Spy Shots

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Who Schooled Who? In The High End SUV Market for 2006?

Part of successfully marketing to a customer base is know exactly what the customer wants and needs

Part of successfully marketing is knowing exactly what the customer wants and needs.

In theory if you do your homework and target the core market for your product, you retain a larger percentage of them if a downturn occurs. But does this always happen?

A case in point has been the recent fluctuations in gasoline prices that spurred a wholesale massacre in the SUV market for everyone. Right?

Well, not for all of the makers it seems. With GM, Ford and Chrysler suffering massive losses in sales in that critical segment, a few of the premium and luxury makers actually continued with business as usual and avoided losing critical market share. This may have been due to them being tuned into their core segments better than the competition, and making sure the benefits of owning, outweighed the temporary rise in expenses. Simply put, if you make the ship desirable enough the rats won’t jump as soon.

But being a premium maker does not necessarily exclude you from losing market share.

While the overall sector held steady with almost a 3.5% gain in sales last year, BMW suffered a drop of 15% in its SUV (SAV) sales primarily due to fuel prices, followed by supply issues later in the year.

Releasing a new mammoth SUV at the height of gas price is a recipe for disaster? Don’t tell that to Audi, they did just so and averaged an impressive 293% gain at year end in sales after the first full month sales for the Q7. They simply knew their audience better and the desire to own a new Q7 far outweighed the costs. Taking Audi out of the equation, Mercedes continued forward with a staggering 67.66% gain in 2006. Distancing themselves from the pack by quite a margin.

While Lexus capped off an incredible year in 2006. Their SUV models took a lesson in the school of hard knocks and suffered an 8% decline in sales for the year. Lexus tends to cast a wider net than most, and may have suffered more from an audience that was more sensitive to gas prices, but even with the sole hybrid maker in the bunch fail to sustain their growth in the segment.

Premium/Luxury SUV Sales 2006 vs. 2005

	2006	2005	Change	%
Audi	10003	0	10003	293.39%
Mercedes Benz	69163	41252	27911	67.66%
Hummer	71524	56727	14797	26.08%
Cadillac	84249	74143	10106	13.63%
Acura	63285	57948	5337	9.21%
Land Rover	47774	46175	1599	3.46%
Volvo	33200	35976	-2776	-7.72%
Lexus	139397	151669	-12272	-8.09%
BMW	68367	58089	-10278	-15.00%
Infiniti	34351	41500	-7149	-17.23%
Porsche	10569	13607	-3038	-22.33%
Lincoln	39270	51991	-12721	-24.47%

Sector	631589	610591	20998	3.44%

*** Audi performance is based on first full month sales vs December sales

Source: Automotive News

Who Schooled Who? In The High End SUV Market for 2006?

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chewy - 2/22/2007 3:31:06 PMView My AgentSpace

+1 Boost

The Q7 has done well for Audi.

reply to this comment

PlanoA4 - 2/22/2007 4:29:25 PM

+2 Boost

In spite of those that say it wasn't selling well, it was averaging about a 30% increase per month.

GTR35 - 2/22/2007 10:16:21 PMView My AgentSpace

+4 Boost

The only reason why Audi is on top is because they didnt sell any suvs on 2005, and so their % is obviously higher than 100. But they still sold less than any other automaker putting it in last place.

MercBasher - 2/23/2007 12:48:56 AM

+1 Boost

In my opinion the best performance is Mercedes, despite a slow start for the R class Mercedes is really growing in the SUV segment.

I'd also give a good grade to Lexus for 2006. They maintained a temendous lead in SUVs versus any luxury competitor despite the fact that they had no new models [actually the Lexus SUV line-up is aging rapidly] and competitors had lots of new and refreshed models.

I give failing grades to Jaguar (no SUV offerings) and to Audi (Q7 was very late to the party, and only selling based on cheap leases)

Agent009 - 2/23/2007 9:13:31 AMView My AgentSpace

+3 Boost

Mercedes is the best performer. It would be hard to really rank Audi as top dog because of the limited scope of their single entry.

izfuney - 2/22/2007 3:42:31 PM

+10 Boost

Your really can’t be serious with this amateur style riff on Stats. Its like saying a kid which Flunked school with an F has had an 100% improvement as he got an E (or D) grade instead of F.
Your very own table belies your incredibly naive assessment about Audi. They have less then 2% (1.58%) of the luxury pie which is hardly a drop compared to the heavyweights.
The luxury market more then others is dependent on new product. Ask MB and their new lineup and their very very aggressive pitch for moving them.

It all can be answered by framing the right questions.
Is BMW or Lexus loosing any sleep over Audi? I doubt so.
Did you score major points with Audi to line up some advertising. Hell yeah!
Did you loose any credibility amongst your readers? What credibility !?
Lesson to be learned from it all ? Sure we write crap for an extra 2 bits, but earning your keep was never easy! Sure beats the dumb ass posters here who write their sorry assed opinions here for FREE ?

Thank your reading the above.

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d1sinfo - 2/22/2007 3:54:01 PM

0 Boost

+12345
Word.

d1sinfo - 2/22/2007 4:01:14 PM

0 Boost

I forgot to mention that BMW was not selling the 06 model until November 06. They were selling 05's. I can't say what brand changes, and model revision changes the other companies were going through but it is safe to say this article is full of fact bending.

PlanoA4 - 2/22/2007 4:26:41 PM

+1 Boost

You have a point on the percentage is easier to manipulate either way (small initial sales do that). But it will skew just as bad the other way if they did not succeed in targeting correctly. But arguably Audi’s appeal is to a smaller demographic so the sales increase would still parallel those that target a larger group just on a lesser scale. The fact remains they released at the worst possible time, and continued to grow sales in spite of the obstacles.

PlanoA4 - 2/22/2007 4:51:22 PM

+1 Boost

Hey IzFunny - You say BMW shouldn't worry?

Hmm do the math bubba and if the Q7 was released in January and tapered down to a 20% increase per month after the first 6 months performance of almost 30% per month, you get 30729 units sold for 2006. Or more the the BMW X3 or X5 sales combined for the same time frame.

Will it do that? Probably not but no one know when it will peak. and then you have to factor in the Q5 in the future when it arrives.

BMW4me4ever - 2/23/2007 11:54:02 AMView My AgentSpace

+1 Boost

plano ... what are you talking about? The BMW X5 production ended in August of 2006 and the dealers didnt have any more vehicles to sell. The Q7 will not even sell close to the same amount of X5's that BMW will sell in the US. The reason is due to a higher demand in Europe than the US, more of the production is focused over there. I thought you would have known that being an Audi guy

reply to this comment

PlanoA4 - 2/23/2007 2:00:17 PM

+1 Boost

Sorry I missed your post. According to my stats the X5 and X3 typically inventory never dropped below 3300 trucks or a 19 day supply, they hover at 22 days typically.

Now I would venture that some dealers ran out, but even here in Dallas the X5 never was sold out, it however may have been in short supply for some models.

Loki123 - 2/22/2007 4:01:16 PM

+2 Boost

Audi had no results last year - therefore there is no benchmark for their stats this year - the 293% Audi has skews the whole chart. Delete Audi - then give us the chart again.

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Agent009 - 2/22/2007 4:16:32 PMView My AgentSpace

+2 Boost

It make no sense to skew off Audi, after the initial surge of back orders of 1310 in June (A partial month). The July figures were a realistic 590 units with no backorder, the continued to build until December peaking at 2321 units. At Average increase in sales was at 30% increase over the prior month in sales. No one came close to that.

PlanoA4 - 2/22/2007 4:20:46 PM

0 Boost

So how would you include audi?

At a 100% increase? It is still on top of the chart either way.

Designer1 - 2/22/2007 4:07:30 PM

+3 Boost

oh man, who ever made this comparison is an idiot.

reply to this comment

d1sinfo - 2/22/2007 4:10:20 PM

-2 Boost

+12345
Word.

PlanoA4 - 2/22/2007 4:19:37 PM

+1 Boost

The figures are posted by the industry. And it is a simple observation based on those figues.

Why do you consider them idiotic? Because you don't like the facts?

Or better yet tell us how you would do it?

1970toyotamarc - 2/22/2007 4:25:59 PM

+2 Boost

Explain please how a change from 0 to 10003 is a 293% increase.

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PlanoA4 - 2/22/2007 4:38:21 PM

+3 Boost

duh read the *** comment it was based on first full month sales (June) to December sales and the increase was calculated for them from that point.

It was to really only way to show any figure at all other than 100% that I could see. It the Q7 sales has dropped at all it would have been a large negative number.

I guess the best way to look at it is to forget the % increase for Audi and just look at the fact they were increasing at 30% per month each month.

sracekili - 2/22/2007 4:41:24 PM

+1 Boost

I'm wodering about that same thing.... if you are going to take the delta between 2006 and 2005 and divide by 2005, as I see how the rest of the company figures are calculated, I don't see any way Audi will get 293%, let alone any number at all.

1970toyotamarc - 2/22/2007 6:13:57 PM

+2 Boost

I'm not disputing the sales success of the Q7, or its awesomeness. I'm not an Audi hater at all, as I have pointed out many times. But that calculating does not make any sense, and it is misleading. I dont know, when mfrs report sales figures of a new vehicle dont they either put nothing in the % increase box, or 100%? Dont ya think that might have been a little eaiser to comprehend? (But then 009 wouldnt have been able to come up with that massive % increase.) Comparing one month to another month may prove an interesting point to you, but it is not statistically valid at all when no other increase is calculated this way.

Rupert - 2/22/2007 7:33:43 PMView My AgentSpace

0 Boost

You can't increase something by a percentage from 0, the answer would be infinity.

Agent009 - 2/23/2007 9:16:13 AMView My AgentSpace

+1 Boost

Don't worry too much about the Audi percentage figure. It was included because a static sales figure would not be an indicator of increase of decrease in sales and the only way to show a figure at all was to start at the beginning.

no1listensanyway - 2/22/2007 5:08:05 PMView My AgentSpace

0 Boost

Im suprised Land Rover is so low, I see new Range Rovers everywhere in NY. Whem my roomate picked up his in November the Sport Supercharged was on back order and the showroom was packed. I know my observations don't indicate overall sales, I thought it would of been an excellent year for them. It must be the LR3 not pulling its weight with sales. BTW, the Audi number is BS.

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Agent009 - 2/23/2007 9:17:20 AMView My AgentSpace

+1 Boost

I was surprised Land rover had an increase at all.

mstangpny07 - 2/22/2007 5:22:14 PMView My AgentSpace

+2 Boost

All I can say is I am VERY happy with my 2007 BMW X5 3.0si...(It was avalible in dec., but I would expect sales to go up in March and April.....

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JRobUSC - 2/22/2007 6:50:01 PM

+1 Boost

you'll see a ridiculous change in percentage a year from now for BMW. Last year MB had a huge spike because the entirely new GL came out, this year it's Audi and the Q7, next year it'll be BMW as the 2007 X5 is selling like crazy, even in spite of the fact that until this week BMW wasn't offering any lease support on it. Four months with no sales support and the 4.8 is still backordered everywhere and the 3.0si is on 7-14 day supply on dealer lots. That's pretty awesome.

S4cabriofoxone - 2/22/2007 9:17:06 PMView My AgentSpace

+1 Boost

I can't wait to see yours, myself.

Agent009 - 2/23/2007 2:43:59 PMView My AgentSpace

+1 Boost

And who's fault is that?

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jt716 - 2/22/2007 6:39:15 PMView My AgentSpace

+1 Boost

Um Land Rover was doing pretty good.Poor Lincoln cant stop bleeding. Volvo had also a surprising decline.

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chewy - 2/22/2007 6:49:53 PMView My AgentSpace

+2 Boost

Audi only has 1 SUV. The Q7. In 2006 it was only on sale for half the year. Audi will probably sell 20,000-30,000 Q7s this year. In 2008 Audi will sell the Q5 as well. So in 2008 Audi will sell 60,000-70,000 SUVs. Right around the competition.

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Rupert - 2/22/2007 7:37:12 PMView My AgentSpace

+2 Boost

Audi only has 1 SUV, it was only on sale properly for half the year, yet it sold 10000 vehicles, the same as porsche.
Also note Audi cut US supplies due to higher than expected demand in the rest of the world, and due to the weak dollar, it wouldn't make much money in the US, so it diverted cars to the rest of the world to make more money.
I'd be pleased if I was Audi.

Agent009 - 2/23/2007 9:21:10 AMView My AgentSpace

+1 Boost

Yep the sales for the Q7 may not peak out for a while so who knows when it will stop and at one point.

truckmen - 2/22/2007 8:42:50 PM

+1 Boost

People who can buy suvs can afford the gas! The only people that avoid them are either concerned with the enviroment or can't afford the gas.

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Agent009 - 2/23/2007 2:45:19 PMView My AgentSpace

+1 Boost

If that were the case they would still be selling well when gas goes up.

S4cabriofoxone - 2/22/2007 9:18:02 PMView My AgentSpace

+1 Boost

EXACTLY! You've denied it, but it's only the ES and RX (or, the cheaply-produced Camry-based models) that drive Lexus sales! The GS, IS and LS all sell relatively poorly, and the only other model that sells very well in suburban areas is the LX470.

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chewy - 2/22/2007 11:58:37 PMView My AgentSpace

+1 Boost

You are correct Will. The RX series which is an entry level luxury vehicle makes up a huge percentage of Lexus SUV and overall sales.

Again, the Q7 was on sale for only half the year.

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1uberaudi - 2/23/2007 7:19:04 PM

0 Boost

Audi sales worldwide are 1+million cars. 3 times that of Lexus. So to say poor Audi our models do not sell in any category does not know what there talking about.

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S4cabriofoxone - 2/24/2007 6:45:07 PMView My AgentSpace

+1 Boost

The A4 sells very well. As is the Q7, and the new TT will be almost sold out (my prediction).

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aznstuart - 2/22/2007 10:12:17 PM

+2 Boost

Lets see, so Audi Q7 did fantabulous and built up an ultimate monthly sales of 2321 units, and you Audi guys claim it'll only get better? Well for January, the Q7 only faired 1636. That's down 700 units. Quite a lot. And lets recap, how many BMW X5s were sold in January? 2445. Wow, that beats both the Q7's record and the last month. Lets look at the MB competitors. Some like to pair the Q7 against the M-Class and others the GL-Class, so I'll post both's January numbers. The ML gets 2351, again, slightly better than the Q7's Dec. number while the GL got 1815 which beat the Q7 in last months sales. And lets see, for the 1st and 2nd place SUVs for January and Last year we get the Lexus RX with 6544 and the ACURA MDX with 4153 for January. That atleast Triples and Doubles the Q7. Wow, such a great SUV and success the Q7 is aint it?

And and don't put your hopes on the Q5. The best selling Mini Luxury Ute right now is the RDX which is only getting 1800 units with the X3 close behind it. So the maximum monthly sales for a small Lux ute is 2000 units. So whoever's dream of 60-70k of Audi SUVs are crushed, sorry.

Oh and, who put Hummer in that list. They aren't luxury with their spartan interiors and rough ride. And most of those 70k units are from the H3 which by no means is deemed a Luxury SUV.

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chewy - 2/23/2007 12:00:26 AMView My AgentSpace

0 Boost

So, MB's GL class barely beats the Q7.

chewy - 2/23/2007 12:01:30 AMView My AgentSpace

+1 Boost

The Lexus RS is an entry level luxury vehicle, you can't compare it to the Q7. The MDX is more of a luxury SUV, but is still priced quite a bit lower.

Agent009 - 2/23/2007 9:32:42 AMView My AgentSpace

0 Boost

I didn't want to classify the Lexus as a non luxury vehicle (something tells me a fire storm would ensue), so I took all Luxury/Premium SUV sales. As classified by Automotive News, hence Hummer.

The figures are combined for ALL models a maker has, both new and discontinued.

trd1 - 2/22/2007 11:14:50 PM

0 Boost

wow, would you look at that all the sales are in the 5 digits and then there is a lexus as usual in the 6 digits. just keep the sales up and dont let them fall.

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bmwdrvr - 2/22/2007 11:37:09 PM

0 Boost

wow cadillac only has 2 suvs, and is second highest in sales, good job cadillac, if they had the same number of suvs as lexus they probably would be the highest with 2 they arent that far off

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komododave - 2/24/2007 7:02:23 PM

+1 Boost

Ha....i was going to say the same comment, but I was afraid all the import lovers on this site would put my boost into the negative in 20 seconds.

komododave - 2/24/2007 7:12:12 PM

+1 Boost

Plus the 2 models they do have are the same vehicle, with one 18 inches longer but identical otherwise. Most everyone else with those numbers has 2 or three distinct models.

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Autoegr525 - 2/22/2007 11:44:51 PM

+2 Boost

Uh how is 10,003 293% of zero? Maybe I'm reading too much into the numbers, but where does that come from

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Larry - 2/23/2007 1:48:14 AM

0 Boost

Also, why don't you include bmw x3 sales, a x3 cost more than a Lexus RX yet you include all of everyone SUV except BMW. 10,000 SUV sales f Audi late q7 . Bias Audi fans, I am happy that Audi suxs and the fact is BMW makes 3 times more profit than Audi, why don't post info on that Agent 009.

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Agent009 - 2/23/2007 2:42:09 PMView My AgentSpace

+2 Boost

This wasn't an article on profit, maybe that is why?

Larry - 2/23/2007 1:54:03 AM

0 Boost

Agent 009 and Chewy post bias audi news, every chance they get to make look like more than the Volkwagens (toureg) they really are.

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chewy - 2/23/2007 2:21:10 AMView My AgentSpace

+2 Boost

Too bad the Porsche Cayenne shares more with the Volkswagen Touareg than the Audi Q7 does. All three are excellent vehicles.

sewingmachine - 2/23/2007 2:41:01 AM

+2 Boost

hey i got an idea, y dont someone post how many suvs were sold for each brand the beginning year it was introduced, btw they should have just left audi out until next year. even better, how about a daily, weekly, or monthly percentage chart.

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Kostin - 2/23/2007 4:03:51 AM

-1 Boost

A part of this article is stupid.Don't forget BMW just changed the X5 last year.It's damn logic that the old model sales dropped(and even so they sold SUPER well for a 7-year old model).On the other hand Audi sold the all new Q7 from January to December 2006 while BMW sold the 7 year old X5.At least mention all the facts when you compare sales.Let's wait the 2007 sales figures.

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Agent009 - 2/23/2007 9:33:53 AMView My AgentSpace

+3 Boost

Someone will always be phasing in and out models so it would just be up to your interpretation at that time.

M53R - 2/23/2007 7:17:45 AMView My AgentSpace

-1 Boost

The new X5 is on the way, also the facelifted X3. They will increase the sales for BMW for sure.

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BMW4me4ever - 2/23/2007 12:05:01 PMView My AgentSpace

+1 Boost

what a ridiculous artlicle? how is 10,003 of 0 293%? I am a little confused on the math for that one. Is this like 1 + 1 = 4 ... I agree that everyone goes thru model updates and such, but it appears that you are trying to reconfirm something about how much you like Audi. I promise you this, the Audi Q7 wont be even close to the BMW X5 by the end of 2007. The X5 4.8L is still sold out til May in most dealers. The Q7, which is larger and less money, can be had by going anywhere.

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Agent009 - 2/23/2007 3:11:14 PMView My AgentSpace

+2 Boost