Redefining Luxury

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In many cases, American automakers are left with the tough work of revamping their luxury cars to appeal to young buyers, while maintaining their hold on older ones who never took to European brands the way their children have. Ford recently unveiled its all-new LS8, a rear-wheel-drive, technologically loaded sedan tweaked and tuned by Jaguar. Chrysler, which has scored a connection to boomers with its Jeep Grand Cherokee, last year launched the 300M, a sleek, import-fighting luxury sedan that competes against such other luxury sedans as the BMW 3 Series and Audi A4. "Our cars became boring, and we lost some ground," says John Sloan, director of DaimlerChrysler's large-car operations in Auburn Hills, Mich. "But our 300M makes you fantasize about driving Route 1 in California."

GM, which pioneered the luxury segment in the U.S., is aggressively pushing to preserve its eroding lead. Last year the company rolled out the Cadillac Seville STS, which blends the raw power and agility reserved for its Chevrolet Corvette with a cabin as quiet as the best European and Japanese sedans. And in Detroit this week executives are introducing what they trumpet as "the future of Cadillac" in a concept car called Evoq, a two-seat roadster with a supercharged V-8 engine, boasting such features as a voice-activated navigation system and e-mail that flashes everything from news bulletins to stock quotes.

Smart gadgetry for safety and entertainment represents the new lap of luxury. The BMW 740i, for example, can be equipped with a navigation and traction control system that acclimates from driving on normal pavement to moving through a winter storm with the touch of a switch. Road-weary travelers might prefer GM's sophisticated stability system, which uses two-directional sensors attached to the car's suspension, steering column and brakes to keep the car on its intended course. Mercedes last year began offering near obstacle detection, which uses radar to alert drivers to objects close by.

American execs, known for overindulging in the hottest trend of the day, insist they'll tread lightly on the techie gizmos for now. Real luxury should simplify a driver's life, not complicate it, they say. "Some of these kinds of items come in handy," says DaimlerChrysler's Sloan. "But we have to be careful about creating too much driver distraction." Maybe so. For now, though, the biggest distractions seem to be parked in rival dealers' lots.