AUSTERITY has become a watchword for public figures in recent years, keen to appear aware of the economic decline affecting the rest of us.
THE economic slide which has led most to rein in spending in recent years has led motor dealers across the nation to report a slump in sales.
But while most of us scrimp and save, delaying big purchases like a new car as long as possible, there are a few wealthy folk who are not only still happy to splash out on a shiny new motor but to make sure it is as big, fast and flash as they can reasonably afford.
In fact, it appears to be the one area of the car market which is expanding. The market share in luxury cars has grown by around 1% every year for the past decade or more.
And although this increase is due in some degree to footballers, singers and Hollywood stars, it can’t just be Simon Cowell and Jay Z who are responsible.
There is a fair proportion of customers who have made a pile in business and want to let others know about it or those who have worked night and day for decades and want something they can enjoy for themselves.
Or maybe they are just finally able to realise their dreams of driving an Aston Martin like James Bond.
According to the region’s largest independent car dealers Benfield, business leaders are often keen to differentiate themselves from the rank and file and a combination of ego and money sends them searching for something a cut above the ordinary when it comes to transport.
And there are those of all classes and incomes who want to enjoy the quality, prestige or plain old snob value of owning marques that would have once been out of their reach.
Prices of the smarter brands are sliding as many customers pick economy as their main buying criteria and as the quality and level of luxury of mainstream brands has soared in the past few years.
And the demand for ever more expensive cars has risen while the prestige of owning a mid-market executive motor like a BMW or Audi has diminished as they become far more common.
Benfield managing director Nigel McMinn said: “Brands like BMW, Mercedes and Audi are becoming more affordable as smaller, cheaper versions are launched on to the market.
“It doesn’t matter who you are – business person, family person, or young person – everybody seems to want premium branded products nowadays.
“That is because we live in an aspirational society. TV and magazines evoke emotions in us and make us want to have associations with those luxury brands.
“Of course if these brands become too mainstream, then successful business people can often seek to go one better.
“That is why the likes of Porsche, Bentley and Maserati are having a successful time of things at the moment.”
An uncertain global economy hasn’t significantly dented sales for ultra-luxury car maker Bentley, which announced earlier this month that sales as of the end of September had reached 5,969 units, a 25% increase year on year, up from 4,759 in 2011.
Double-digit growth was seen across the board in all of Bentley’s top markets, with European deliveries rising 20% to 950 cars and UK deliveries rising 10% to 854 cars.
Benfield has also got in on a slice of the action, after recently unveiling the first showroom in the UK entirely for Maserati sports cars.
The car dealers won the right to open the only standalone site selling the prestige marque.
And bosses of the Newcastle-based firm are confident that demand will be strong, despite prices starting at around £80,000.
McMinn said: “We predict we’ll sell about 30 to 40 of these next year as we’ve already had around 80 serious inquiries since opening our showroom less than eight weeks ago. We sold our first Maserati to Newcastle United footballer Jonas Gutierrez and both Fabricio Coloccini and Ryan Taylor have both expressed an interest.
“The Maserati feels exciting and is something which makes you smile when you drive it.
“If you choose the right brand it’s an extension of you and your business. If you want to say, ‘My business is a success and financially buoyant’ then you can say that with a nice car.”
Italian luxury sports car maker Ferrari last month said it expected to post higher results for the year after reporting record numbers for the first half, thanks to the popularity of its eight-cylinder models like the California 30 and 458 Spider.
In 2011, Ferrari had a trading profit of £252m on revenue with the shipment of 7,195 vehicles.
For the first half of 2012, Ferrari posted a 13% rise in trading profit to £123m and a 10% rise in net profit of £807,000.
The number of cars delivered to dealers went up 7.4% to 3,664, also a record. Like other luxury car makers, Ferrari has been relatively protected from the sharp drop in car sales in Europe because it serves a clientele whose spending habits rarely change as a result of the vagaries of the economy.
Another reason is its exposure to buoyant markets like the US, China and other emerging markets.
Although it has been expanding into these emerging markets, where demand from a growing class of wealthy consumers is strong, the US remains Ferrari’s biggest market.
Northern TUC regional secretary Kevin Rowan said business leaders with a penchant for luxury cars were all well and good, as long as they didn’t paint a tasteless picture to a workforce that may be on the minimum wage, or worse still, being scaled back.
“There still seems to be a lot of rather big, flash cars knocking about,” he said. “Yes, employers seem to be more honest and engaging with their staff in recent years but you don’t often see them driving around in an average car.
“Business leaders should be aware of the image they present. If they are asking their workforce to temper their aspirations and are modest about pay increases, then it’s perhaps not a good idea to show up to work the following day in an expensive car.
“Although we’re still suffering from the recession, those at the top aren’t actually hurting. Business leaders are enjoying the lion’s share of wealth and are still wanting those luxury goods.
“This is perfectly understandable and acceptable as long as they’re not painting the wrong message to their staff.”
IT is interesting to see what some of the most successful business people choose to drive and why.
It can’t be assumed that they will all be rolling in flashy cars. After all, not all are car lovers like David Beckham, and in some cases they choose vehicles based on practicality just like everyone else.
Still, surely many would have an extra sports car lying around in the garage for the weekends? Not according to what these Forbes List leaders drive:
Warren Buffet, the richest investor in the stock market world drives a Cadillac DTS.
Bill Gates, Microsoft co-founder, likes German sports cars, Porsche to be exact. He has been rumoured to own several Porsche models.
One of the co-founders of Google, Sergey Brin, does not like to show his big bucks with a super car. He has a simple Toyota Prius.
However, he is a strong investor in green technology and through this he has developed the Tesla Roadster, an electric car.
Ralph Lauren is well-known for his collection of classic cars. In fact, one of his favourites is the Bugatti Type 57SC Atlantic, a rare automobile.
Steve Ballmer (number 31 on the Forbes List) prefers to drive home in a Lincoln Continental.
Another businessman who likes his cars is Michael Dell, the guru and founder of Dell computers. Some of his favourites are the Porsche Boxster and the Hummer H2.
Virgin founder Richard Branson says he is a big supporter of clean energy. Nevertheless, his low-emission car is certainly striking – a Saab BioPower 95.
Finally, Ingvar Kamprad, founder of Ikea, who lives in accordance with his taste for the economical and functional, has been seen driving a modest Volvo 240 GL.
And he has always been proud to say he uses public transport.