Redefining Luxury

The fast-growing market for $30,000-and-up cars is the industry's next big battleground

For all their image as the caviar of automobile brands, Mercedes-Benz and Jaguar spent much of the past decade longing for a little meat-and-potatoes appeal. Slumping sales in the U.S. had execs worried, as did the rising popularity of Japanese newcomer Lexus. The haughty Germans and the aristocratic Brits realized that the wealthier baby-boomer set--now in a buying frenzy--was turned off by the companies' stuffy image and limited product line. "Our cars were admired but were perceived as an unattainable icon," concedes Joe Eberhardt, vice president of marketing for Mercedes-Benz North America. "Our problem was, we weren't considered a fun car."


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