Pricey cars selling well 'What slump?' say dealers of luxury cars.


While $8,000 Ford Escorts are collecting dust on dealer lots, new car buyers are waiting in line to buy $50,000 Lexus luxury cars.

In one of the quirks of what some say is the worst car market in 10 years, some makes of luxury cars are selling better than ever.

"That seems to be the hot ticket now," said Tom Dukes, an analyst with J.D. Power and Associates, a California car market research firm.

Although some luxury models, such as the Jaguars, Rolls Royces and expensive sports cars are in a slump, most models between $20,000 and $40,000 are doing better than the rest of the market, Dukes said.

Among the most popular luxury models are the newly restyled Cadillac Seville, the lower priced BMWs, the Mazda 929, the Accura Vigor, the Audi 100 and models offered by the three-year-old Lexus car company, Dukes said.

Although not a large volume seller, the $250,000 Rolls Royce remains popular among those who can afford it.

A new federal luxury tax on cars priced at more than $30,000 seems to have hurt sales of some high-priced models, but "most of it is motoring along in pretty good shape," Dukes said.

One reason seems to be that buyers who can afford a $40,000 car have been hurt less by the recession than other economic groups.

"People who buy economy cars are the first to be damaged in a downturn," Dukes said.

Nearly every car dealer reports sales are down from last year and far from 1988, which dealers say was their last good year. The recession has hit American car companies especially hard. Ford and General Motors this week reported combined losses of more than $1.6 billion in the third quarter. Chrysler is expected to report a third-quarter loss next week.

Dealerships are depending increasingly on used car sales and service departments to see them through the downturn.

But dealers who can appeal to elite buyers are doing better than most. "People that have the money

still have it," said Bob Brookman, sales manager at Brooks BMW on Kenilworth Drive.

Jeffrey Vaughan, co-owner of Auto Village Oldsmobile-Cadillac-Jeep Eagle in Bel Air, said among his most popular models are the new Cadillac Seville, which starts at around $35,000 and Cadillac Eldorado, with a starting price around $32,500. Right now, orders are exceeding availability of those cars.

Vaughan said he expects another Cadillac model, a $58,000 Allante with a high performance engine, will be a big seller next when it goes on the market in the spring.

"A person in an upper income level will still buy a nice car every three or four years," he said.

Alan Wagner, general manager of European Motor Sales Ltd. in Towson said sales of the Alfa Romeo, which cost between $20,000 and $30,000, are up over 60 percent over last year, although he declined to say how many cars he sells a month.

Sales of Mercedes, which had been down, appear to have picked up recently. "This month looks like it might shape up to be a better market than we've had," said Charles C. Fenwick, owner of Towson Valley Motors.

Another luxury line, Toyota-owned Lexus, is one of the best selling cars in the market, Dukes said. Part of its attraction is its novelty. "People like new things," he said.

Jimmy Berg, sales manager for Len Stoler Lexus in Owings Mills, said sales are better than they've been in the three years since the car was introduced. "Everything is selling," he said.

Lexus cars cost between $26,500 and $49,000, and Berg said the most popular model sells for $46,000. Many of his customers are former Mercedes and BMW owners who are balking at paying luxury tax on higher-priced vehicles, he said.

Not all Luxury car buyers have escaped the recession's impact. Bryan Seward Bryan Seward, sales manager at Laurel Toyota & Jaguar said real estate developers and lawyers who might buy an Jaguar are not in the market for new cars. He said that his sales are down 35 percent from last year.

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