The Tesla Model S: Changing the Luxury Landscape

In October, Forbes reported some surprising (and fascinating) news: in the luxury European car market, Tesla Model S sales surpassed those of two major luxury brands, and by a significant margin.

The Tesla S sold twice as well as the Audi A8 limo and a whopping four times more than the BMW 7 model, especially in countries that subsidize electric vehicle purchases (but even in those that don’t, like Switzerland and Germany).

We think that this trend might be representative of larger changes happening within the luxury industry as a whole. Tesla is a relatively new name in the market, but skyrocketing sales suggests it’s met some very pressing needs for luxury consumers that have, up until this point, gone untapped.

At first glance, the Tesla Model S is not your typical luxury car. Traditionally, luxury vehicles are marketed for their style or exoticism. Company reputation, too, has been a major factor at play in terms of how consumers choose their luxury vehicles. As a relatively new brand, Tesla doesn’t have the historic legacy of an Audi, BMW or Ferrari, and its design, while sleek and attractive, bespeaks more function than fashion.

However, the Tesla Model S does have some features common across the board with luxury cars, namely its speed and “instant” acceleration. It also does them one better with impeccable safety ratings and a Consumer Reports review that famously “broke” the ratings system and set a new standard for quality. Plus, Tesla owner satisfaction is incredibly high—97% of Tesla S owners say that they would purchase their cars again.

The standout features of the Tesla Model S is, of course, its all-electric, zero-emissions engine, which might be the key to why the Model S has surpassed sales of other, gas-powered cars. These days, the concept of luxury is increasingly tied to the consumer’s role as a responsible global citizen, as evinced by trends like the widespread embrace of handcrafted, bespoke and responsibly-sourced goods. Since the Tesla Model S is the most environmentally-friendly car on the market, its rise to prominence in the luxury vehicle market may indicate that luxury consumers are shifting their assets towards responsible vehicles, as well.

As always, we’d like to hear your thoughts on this trend. What do you think constitutes luxury? Does the Tesla S meet your standards? Is it something you’d want to see in our fleet? Drop us a line at sales@empirecls.com and let us know.