Luxury Transportation and the Next Big Movement.
The Van or MPV, a word synonymous with being a cumbersome, overlooked, big, slow, a design only a mother would love, made for parents that never heard of birth control. Yet, if we look at the uses and the life of the van through history it has accomplished more, has had more of cult following, done more for society and lasted longer when other designs, fads, and concepts have faded. So why is this vehicle unable to go the way of the dodo? Adaptability. And why it is the next big-ticket item in the world of luxury and why should more manufactures be interested in making them and you be more interested with saving your pennies to have one?
The MPV unlike many other great vehicles in history does not have some incredible origin story of where engineers came together from around the world to design a vehicle that would defy physics or revolutionize the world. It was merely created to carry people and their belongings from one point to the next starting back when vehicles were made out of wood and had maybe two horsepower. The word van derives from “caravan” a movement of people traveling together. This idea has pretty much been around since the invention of the wheel, and the basic concept has not changed and not just in America but all over the world. The MPV due to its flexibility is the most widely used vehicle in the world, from Europe to Asia, from the Americas to Africa, all the way to Australia.
To bridge the gap and visualize the connection of how the luxury van is the next big addition into the luxury world we first have to dive into the luxury world of the automobile, define what luxury means in today’s standards, how it is perceived, the global impact, the market dominance, the buyers and expectations, and what the future holds. I will be focusing on the luxury van manufactures, not third party or coach builders for manufactures or much larger vans such as Sprinters that can be converted into rolling hotels. As of now, give or take the global luxury van market size is calculated at $21.84 billion in 2024, and is expected to grow to $23.02 billion in 2025, at this pace in nine years or 2034 it is projected to be around $36.95 billion by 2034.
The auto luxury segment has historically been dominated by a few manufactures producing ultra-high-end sports cars and sedans, and not much has changed with the manufactures. However, in the last twenty years those manufactures have had to adapt and change to the car market and implement SUVs into their lineup which has only expanded their dominance. SUVs have been popular in the global automotive market since the early 2000s taking over the role of both the luxury sedan and the family minivan (for now at least). This is mainly due to its size, practically, convenience, safety, design, and performance. Buyers in the market for a new premium or luxury vehicle will purchase a SUV over the traditional sedan or even sports car because of those reasons. This might be because of the few traditional manufactures selling those luxury vehicles have now converted to manufacturing SUVs, so they might not be losing a customer but more of a vehicle in their line up due to the demand of the SUV, and I think this where the Luxury Van will also come into play.
Global impact and Market Dominance:
Sometimes when you are over looked you have the ability of seeing opportunities that you would otherwise overlook or not be interested in and the luxury van took full advantage of this with the luxury market overseas in Europe and China, especially China. China right now and probably for the foreseeable future is the most important market for the luxury segment. Europe so far has dominated the luxury car market, mostly this can be attributed to the majority of the luxury car market manufactures reside in Europe and favorable government policies aiding market growth. The segment of the luxury market right now is majority broken down into three segments, hatchback, sedan, and of SUV, with sports cars and luxury MPVs bringing up the rear. With China’s market growing due to the uptick in prosperity and disposal income, as well as the continued increase of ultra-high-net-worth individuals, people with more money than you and me, about $30 million just for investments and your regular high-net-worth individuals who have to deal with between $1 million and $20 million to invest. We are now in a world with fast money where more and more millionaire and even billionaires being created in more places which is causing the perfect Ven diagram (storm) for luxury automobile buyers. We are no longer seeing the market and sales growth being solely dominated by North America and Europe, the circle has grown to Asia and the Middle East. With this new geographical shift comes new buyers with new cultures, new wants and needs, and new ways of showing off those needs that are possibly more in line with what they are used to. The luxury van market has grown as a result of rising disposable incomes, advancements in technology, and the availability of convenient rental and subscription models.
Buyers/Expectations:
Very much like anything in the world everything evolves and this is no different in the auto world with luxury buyers and expectations. Consumers seeking high-end luxury items now expect an exclusive and highly personalized experience. They desire a seamless customer journey that combines simplicity with customization, allowing for tailored services and products that reflect their individual preferences. This trend emphasizes the importance of delivering exceptional service and unique offerings to meet the sophisticated tastes of luxury buyers. In addition to these traditional factors, quality and fit and finish continue to influence purchasing decisions, consumer preferences vary by region. Most buyers now prioritize technology, digital interactions, connectivity, safety, and advanced driver-assistance systems or (ADAS). Travel away from Asia towards the America or Europe and consumers place greater importance on styling, performance, and the overall driving experience.
This divergence of the two beliefs will only become more separated, one becoming dominate and the norm and the other becoming a hobby or a specialized sector in the auto world. The feel of the car, the tangibility, the driver feedback, the essence, soul of the car and the art of driving, all of these experiences and emotions will become like the way of the horse. This is not a new expectation or should be surprising, with every new automated or safety feature to benefit the ease of driving you slowly lose the joy and human interaction. Take the automatic transmission, did wonders for cars sales, expressing luxury, technology, and expanding the market but you lost the feel and connectivity with the car through a manual transmission. With vehicles now starting to get into the third level of ADAS, manufactures marketing vehicles for younger generations already immersed into the self-automated world, uber drivers and less interaction with driving, the vehicle is now becoming more of an appliance rather than an expression of art and desire. This trend of technology over substance and design can be seen in most manufactures today.
Future:
One cannot talk about luxury and the future of luxury without involving EVs and autonomy into the equation. The EV which was originally conceived for everyone and for moderately income families has now become a symbol of wealth, status, and being an elitist. You have consciously made movement, letting people you have enlisted into a higher tax bracket, maybe it was to express concerns about the environment or maybe you were done with maintenance on a vehicle. It is in my opinion that the luxury segment over the next ten years will be dominated by the EV market, following in another fifteen years will be level 4-5 autonomous vehicles. Customers who value sustainability who are already owners of premium or high-end luxury traditional combustion vehicles are more likely to switch to EVs for their new vehicle. Outside of a zeitgeist choice, most ultra and high affluent buyers are looking for simplicity and want the ease of what the EV can provide.
Top Tier luxury brands need to stay at the top and the way to do that is with new innovations and technology, the EV is catalyst for doing that at an accelerated rate. With new cutting-edge technology auto manufactures are able to harness the future and push their brand forward using new or revamped vehicles in their lineup. Right now, as mentioned before the SUV is the dominate vehicle in the luxury market and is projected to be because of its perceived, safety, utility, and size, unless there is another vehicle that can accomplish and take that even further. And this is where the luxury van shines through.
We are in a fast paced, digital, espresso always moving and hustling world. We are able to work, shop, connect, interact, make and watch movies from anywhere in the world, which only makes it natural that the spaces we inhabit are starting to reflect our lifestyles so should the flexibility of them. With this growing need for flexibility will be further propelled by autonomous vehicles giving us the opportunity to reimagine and redesign interiors and experiences with a fresh sense of direction and purpose. All of this has leads us to a place where the luxury van will become the ultimate expression of sustainability, status, wealth, technology, flexibility, and a person’s lifestyle and not just for the high and ultra-high net worth individuals. Right now, the income level and improvement of living has created a small but expanding market for luxury vans concentrated in Europe, Asia, and parts of the Middle East. The largest of all the markets for the luxury van is China, where manufactures and their respected models such as Lexus LM, Buick GL8, Mercedes V-Class (EQV), Toyota Vellfire, Hongqi HQ9, Bestune M9, and Zeekr 009 Grand have already capitalized and have been dominating the market in their respected areas. Volvo the newest player in the luxury van market has seen the value and created a brand-new EV luxury van the EM90 specifically for the Chinese market with the potential to expand. Mercedes announced that it will be importing its V-Class luxury van to the US by 2026, and it will be fully electric. Auto manufactures are starting to see the benefit, potential and possibilities of the luxury van in the market and it will not take long for society to follow especially when they notice the benefits over the competition.
Much like the SUV before it the luxury van benefits from not only its simplicity but it’s size, practically, convenience, safety, design, and technology and in some cases its ability to be configured to the customer’s desire. This one unique factor trumps the competition. Let’s talk about its shape and then benefits behind it. Due to the less than energic rectangle shape it is easier to have more freedom and design with its interior construction that you would normally encounter in the sedan or SUV, less one dimensional, especially when autonomy is more prevalent.
Much like in a sedan you are closer to the ground which translates to better handling and less body movement which makes it safer in the turns, and then much like the SUV you are higher up for the ease of getting in and out of the vehicle and have the presence of being seated in a higher driving position which translates to observing the road easier. In addition, to the low ground clearance you have the luxury of walking into the vehicle via sliding door, no more bending your back and squeezing in the door frame or lifting yourself into the vehicles like you would with the SUV. The act of getting in and out of the vehicle in itself will have less agony, and more grace. Then there is the interior size.
Van themselves are naturally larger on the inside because they do not have to obey the same rules as SUV and sedans which gives them more freedom, comfort, and flexibility to configure, design, and move around the cabin with ease. When configuring the cabin, the designers are able to be more creative, and have more fun with the placement of items and design due to the endless amount of space to create the highest level of relaxation for socializing. Captain’s chairs for example can be positioned further forward or back and longer in length with recline options to 180 degrees, swivel, with heating, cooling, massaging comfort setting for soft or firm. Sound, light, temperature, scent, physical and digital content can all be tailored to you just by simply entering the vehicle. All of this can be changed depending on the ride, mood or emotion that you are expressing. Continuing on with the size, not only is the third row a real working third row (if so desired) but the ergonomics of the vehicle make it possible to walk back their vs for you to harness your inner contortionist just to get back there and have legs crushed. Add all of this with the advent and surge of electric vehicles the luxury van only gets more luxurious and bigger with the loss of mechanical moving parts. Then there is the driving aspect, streamline designs with low coefficient drag, a long wheelbase suited with the batteries on the floor connected to strong EV motors make luxury vans not only extremely smooth but most likely having better range than their SUV counterpart.
For the luxury van to really make an impact such as the SUV in the market it will have to slide its target audience to more than just the uber wealthy and elite, it has to hit home to the common person with all different sizes and variations, much like the SUV has done over the past 30 years. No one knows the future, the best we can do is crunch the numbers, follow the trends, and influence the people we deem necessary to make investments happen, profitable, and come to life. I myself am an optimist by nature and the idea of high-end luxury vans roaming the streets dropping off celebs at the red carpet, a board meeting happening on the go, or stuck in traffic decked out to where you feel you are in a nightclub, movie theater, a penthouse boardroom office, even a beach resort, or what feels like a living room sounds a whole lot better than what we think luxury is today in a cramped sedan or bloated SUV. Luxury has always been a desire and an experience beyond that of those around you, tailored specifically to your needs and wants, it is a personal feeling that one’s hopes to capture more than once, the Luxury Van is that and the future.
