If you’re thinking of investing in a luxury car, you’re in luck. The luxury car industry offers multitudes of options that can cater to all your preferences. From Porsche supercars to classy Lexus SUVs, you can find a car that will deliver superb performance and a sophisticated driving experience at a reasonable price. Hence, if you have the budget, investing in a luxury car (or more) is an excellent way of diversifying your assets.
Still not enough? Here are three reasons why luxury cars are an excellent investment.
Luxury Cars Have Unparalleled Brand Value
Porsche, Ferrari, Lamborghini, Lexus, and Mercedes Benz. What do these car companies have in common? Outstanding brand value. You can tell how valuable it is through its branding with just a glimpse at the car’s emblem. After all, luxury automotive manufacturers have built an unmatchable brand value that other car manufacturers can’t simply attain.
Ferrari, for example, has resisted economic downturns that have severely affected other car manufacturers through sheer market share alone. After all, Ferrari’s target demographic is exceedingly wealthy and can ride through the downturns and changes in purchasing patterns of traditional car buyers. Furthermore, Ferrari doesn’t care about increasing market share since they focus heavily on their target demographic, and they only produce a handful of cars compared to mainstream automobile manufacturers.
Luxury Cars Have High Resale Values
Everyone differs in luxury car preference, particularly the car’s brand and model. Even so, the resale value for luxury cars is traditionally high. However, keep in mind that vehicles often depreciate over time, but here are some safe bets in luxury car brands and models:
- Audi A7 (2021). According to Kelley Blue Book, this car has an estimated five-year depreciation rate of 28% relative to its original price. With a four-cylinder, 335 horsepower V6 engine, it’s no wonder this car has a low depreciation rate. Comparable models to this liftback sedan are the Porsche Panamera and BMW 8 Series Gran Coupe, which are priced significantly higher than the Audi A7.
- BMW X4. Reports from Motortrend say that the BMW X4 retains about 51% of its value at resale. With a four-cylinder engine with 248 horsepower and characterized by its coupe-like roofline, Motortrend expects that the BMW X4 will hold its value better than its competitors.
- Tesla Model S. Often enough, electric vehicles have poor resale value, but not with Tesla. The Tesla Model S has a whopping 17.1% depreciation rate, according to Green Car Reports.
Luxury cars depreciate more if you damage your vehicle. Hence, it’s vital to take extra precautions when protecting your vehicle. If you want your luxury car to stand the test of time, consider installing paint protection such as an Auto Armour PPF to avoid scratches and preserve your car’s finish without relying on an aftermarket paint job.
Luxury Cars Use Ultramodern Technology for Utility and Safety
A car equipped with top-of-the-line safety features can be considered futureproof. After all, safety features triumph over design and performance. That’s why luxury car manufacturers provide their vehicles with top-of-the-line safety features that classic cars don’t have. Some of those are blind-spot warning, airbags (all over the car), telescoping steering wheels, hill-start assist, and more. Plus, since luxury car manufacturers prioritize safety, you’ll get a safe and functional vehicle no matter what car you choose.
If advanced safety features aren’t enough to keep the car’s depreciation rate low, maybe ultramodern technology will. Luxury car manufacturers modernize their vehicles with top-of-the-line information systems such as Android/Apple Auto support, TV screens for every passenger, advanced dashboard, customizable cooling per passenger, wireless chargers, and more.
Benefits from Other Luxury Investments that Luxury Cars Can’t Offer
Jewelry
From colored diamonds to natural saltwater pearls, investing in jewelry is one of the go-to luxury investments. After all, jewelry is easy to store, unique, takes less space than luxury cars, and has a high resale value. Plus, buying and selling jewelry behind closed doors offers the highest price and better quality than transacting at a retail level. Compared to luxury cars that need to be regularly maintained, jewelry has little to no maintenance fees. It’s important to note that jewelry investments also have the largest size to value ratio, so keep that in mind if you have no space for luxury cars.
Rare Whiskeys
With a whopping growth of 23% for the past year alone, rare whiskeys are a significant investment. Remember that investing in whiskeys values its rarity and age to yield a high financial return. One unique aspect whiskey has that most luxury cars don’t is the history of the product. For example, some luxury whiskey companies offer whiskey distilled in the 60s by the distillery owners themselves. Due to this, there are only 100s of whiskey like it, adding a unique charm that ups its resale value.
No matter what commodity you’re aiming to invest into, it’s vital to research every industry’s history and future predictions. After all, we wouldn’t want to lose our investment to poor planning.
