Wheels of fortune

From tail-fin Cadillacs to the Hummers of the SUV heyday, the principles of auto luxury have been passed down like slab-sided commandments: bigger, stronger, faster.

But with new environmental regulations staring them in the face, luxury carmakers are trying on a new set of values — smaller, humbler and more fuel-efficient — that might shock a large-barge traditionalist.

Land Rover's striking, $44,000 (Dh161,600) Range Rover Evoque crossover is the lightest, most fuel-efficient Rover in history. Powered by a turbocharged four-cylinder rather than a beefy V-8, the Evoque earns a federal highway rating of 28 mpg.

Lexus bills its CT 200h as the world's first compact luxury hybrid hatchback. BMW plans to begin leasing small numbers of its Active E, an all-electric version of its perky 1 Series coupe, in urban markets. Small sedans, crossovers or hatchbacks are in the works from Cadillac, Mercedes, Lincoln, Porsche and more.

Even an imposing sport sedan, the exotically styled Fisker Karma, goes for a tiny game-changer under the hood: a two-litre GM four-cylinder mated to a plug-in hybrid system, good for 403 total horsepower.

In some ways, industry downsizing is a do-it-or-else proposition. A federal target of 54.5 mpg by 2025, along with anticipated carbon dioxide emissions rules in Europe, have even deluxe brands scrambling to increase fuel efficiency.

But a question remains: are enough people willing to spend big bucks on a little car?

Smaller luxury cars, many powered by frugal diesels, have proliferated in Europe. But Americans have rarely seen the point of buying less car, especially when a roomier version can be had for roughly the same price.

"We're still a bit in the experiment stage," says Jeff Schuster, director of forecasting for J.D. Power & Associates.

The list of America's most notorious luxury failures is littered with small, entry-priced models. Lower the bar too far in styling, features or power, and U.S. critics and buyers quickly sniff out a designer impostor.

In the 80s, Cadillac dressed up a rattletrap Chevrolet Cavalier and called it the Cimarron. Consumers weren't fooled.

Cadillac will look to correct that mistake with the ATS sedan, a taut-bodied BMW 3 Series fighter that goes on sale next year. Caddy is also developing a compact plug-in hybrid based on the Chevrolet Volt's system.

As with the Cimarron, a cut-rate luxury car can tarnish the image of an entire brand. That's what happened when Jaguar — desperate for its own entry-level rival to the BMW 3 Series — disguised a Ford Mondeo sedan with leather and a feline ‘leaper' badge and tried to pass off the shoddy result as the 2001 X-Type. The Jag later joined the Cimarron on a ‘Time magazine' list of the 50 worst cars of all time.

Wallet check
Yet automakers and analysts say that much has changed. Soaring fuel prices and concerns over climate change have even wealthy customers checking their wallets or questioning consumption.

Schuster notes that, in contrast to the social climbers of yesteryear — conspicuously rebadged versions of mainstream models — new versions tend to be sophisticated, stand-alone designs. The success of BMW's Mini has also helped make the market safe for premium small cars, for both automakers and buyers.

For Mercedes, the German automaker has long restricted its affordable, front-drive A-Class hatchback and B-Class minivan to foreign markets, suspecting that Americans would reject these practical-yet-frumpy machines.

But Mercedes has radically revamped these small cars with Americans in mind. At New York's auto show in April, Mercedes showed a stunning A-Class concept, which along with a more-stylish B-Class, is being readied for America in 2013. Small four-cylinder turbo engines will power those models, which analysts expect will start around $30,000, and Mercedes plans hybrid or electric variants.

"If you're half-hearted about downsizing, people perceive that model as being less," says Donna Boland, a spokeswoman for Mercedes. "But these cars will be every inch a Mercedes."

For leading luxury brands, entry-priced sedans or crossovers at roughly $30,000 to $50,000 — including the 3 Series, Audi Q5 and Mercedes C-Class — have become crucial drivers of sales and profits. But as these cars have grown larger and costlier, automakers see a fertile niche just below and a chance to capture younger buyers, perhaps for life.

As Mercedes developed its premium small-car strategy, the automaker identified a mass of buyers from Generation X and Y entering peak earning years of roughly age 40 to 54, even as baby boomers eased into retirement.

"This is a different buyer group than what we've dealt with for decades, with different ideas on what and how they want to drive," Boland says.

The numbers appear promising. J.D. Power projects sales of small premium cars to reach 450,000 by 2015, from just 100,000 in 2005. Pint-size models would account for nearly one in five luxury sales, up from one in 20 in 2005.

Perhaps no car symbolises the changing order like the Aston Martin Cygnet. The British ultraluxury brand, famed for six-figure Grand Touring cars, has given the Toyota iQ, a tiny city car in the vein of the Smart, an opulent makeover. The resulting Cygnet, powered by a mere 1.3-litre engine, is on sale in Europe for about $48,000. Aston may consider bringing the microcar to big-city markets here in coming years.

Since the negative fallout over the X-Type, Jaguar has never again tried a compact model. But Ian Callum, Jaguar's influential chief designer, has acknowledged the line up's glaring lack of a small sedan or crossover and suggests those holes may soon be filled.

From tail-fin Cadillacs to the Hummers of the SUV heyday, the principles of auto luxury have been passed down like slab-sided commandments: bigger, stronger, faster.

But with new environmental regulations staring them in the face, luxury carmakers are trying on a new set of values — smaller, humbler and more fuel-efficient — that might shock a large-barge traditionalist.

Land Rover's striking $44,000 (Dh161,600) Range Rover Evoque crossover is the lightest, most fuel-efficient Rover in history. It is powered by a turbocharged four-cylinder rather than a beefy V8.

Lexus bills its CT 200h as the world's first compact luxury hybrid hatchback. BMW plans to begin leasing small numbers of its Active E, an all-electric version of its perky 1 Series coupé, in urban markets. Small sedans, crossovers or hatchbacks are in the works from Cadillac, Mercedes, Lincoln, Porsche and more.

Even an imposing sport sedan, the exotically styled Fisker Karma, goes for a tiny game changer under the hood: a two-litre GM four-cylinder mated to a plug-in hybrid system, good for 403 total horsepower.

In some ways, industry downsizing seems to be a do-it-or-else situation. > A US target of 54.5 mpg by 2025 and anticipated carbon dioxide emissions rules in Europe have even deluxe brands scrambling to increase fuel efficiency.

But a question remains: are enough people willing to spend big bucks on a little car?

Smaller luxury cars, many powered by frugal diesels, have proliferated in Europe. But many people have rarely seen the point of buying less car, especially when a roomier version can be had for roughly the same price.

"We're still a bit in the experiment stage," says Jeff Schuster, Director of Forecasting for J.D. Power & Associates, a global marketing information services firm.

Is small really beautiful?
The list of America's most notorious luxury failures is littered with small, entry-priced models. Lower the bar too far in styling, features or power, and US critics and buyers quickly sniff out a designer impostor.

In the eighties, Cadillac dressed up a rattletrap Chevrolet Cavalier and called it the Cimarron. Unfortunately for them, consumers weren't fooled.

Cadillac will look to correct that mistake with the ATS sedan, a taut-bodied BMW 3 Series fighter that goes on sale next year. Caddy is also developing a compact plug-in hybrid based on the Chevrolet Volt's system.

As with the Cimarron, a cut-rate luxury car can tarnish the image of an entire brand. That's what happened when Jaguar — desperate for its own entry-level rival to the BMW 3 Series — disguised a Ford Mondeo sedan with leather and a feline ‘leaper' badge and tried to pass off the shoddy result as the 2001 X-Type. That Jag later joined the Cimarron on a Time magazine list of the 50 worst cars of all time.

Yet automakers and analysts say that much has changed. Soaring fuel prices and concerns over climate change have even wealthy customers checking their wallets or questioning consumption.

Schuster notes that in contrast to the social climbers of yesteryear — conspicuously rebadged versions of mainstream models — new versions tend to be sophisticated, stand-alone designs. The success of BMW's Mini has also helped make the market safe for premium small cars, for both automakers and buyers.

What works for Mercedes
For Mercedes, the German automaker has long restricted its affordable, front-drive A-Class hatchback and B-Class minivan to foreign markets, suspecting that Americans would reject these practical-yet-frumpy cars.

But Mercedes has radically revamped these small cars with Americans in mind. At New York's auto show in April, Mercedes showed a stunning A-Class concept, which along with a more stylish B-Class, is being readied for America in 2013. Small four-cylinder turbo engines will power those models, which analysts expect will start around $30,000.

"If you're half-hearted about downsizing, people perceive that model as being less," says Donna Boland, a spokeswoman for Mercedes. "But these cars will be every inch a Mercedes."

For leading luxury brands, entry-priced sedans or crossovers at roughly $30,000 to $50,000 — including the 3 Series, Audi Q5 and Mercedes C-Class — have become crucial drivers of sales and profits. But as these cars have grown larger and costlier, automakers see a fertile niche just below and a chance to capture younger buyers, perhaps for life.

As Mercedes developed its premium small-car strategy, the automaker identified a mass of buyers from Generation X and Y entering peak earning years of roughly age 40 to 54, even as baby boomers eased into retirement.

"This is a different buyer group than what we've dealt with for decades, with different ideas on what and how they want to drive," Boland says.

The numbers appear promising. J.D. Power & Associates projects sales of small premium cars to reach 450,000 by 2015, from just 100,000 in 2005.Pint-size models would account for nearly one in five luxury sales, up from one in 20 in 2005.

Perhaps no car symbolises the changing order like the Aston Martin Cygnet. The British ultra-luxury brand, famed for six-figure Grand Touring cars, has given the Toyota iQ, a tiny city car in the vein of the Smart, an opulent makeover. The resulting Cygnet, powered by a mere 1.3-litre engine, is on sale in Europe for about $48,000. Aston may consider bringing the microcar to big-city markets here in coming years.

Since the negative fallout over the X-Type, Jaguar has never again tried a compact model. But Ian Callum, Jaguar's influential chief designer, has acknowledged the line-up's glaring lack of a small sedan or crossover and suggests those holes may soon be filled.

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The godfathers of opulence

No talk of luxe designer motors holds water without the mention of — and undeniable lust for — Maserati, the makers of the iconic Quattroporte, Birdcage and, more recently, GranTurismo, among others. The same can be said for Ferrari, also an Italian carmaker — does the name itself not set off your adrenalin glands? The Italian car mafia eagerly awaits you at the Dubai International Motor Show this year with new lines, concepts and, need we say, your impossible wish list for the year ahead.

Umberto Cini, Managing Director, Maserati Middle East & Africa, is expecting a lot of attention for the brand at the show, which he sees as a fantastic opportunity to showcase Maserati's future. "The Middle East is one of the most influential regions for Maserati and we hope our vision for the future thrills visitors to the show."

Visitors to the Al Tayer Motors Maserati stand will get a preview of a high performance luxury sport SUV — the Kubang; a unique collaboration with one of Italy's most revered fashion houses — the GranCabrio Fendi; and finally the Maserati GranTurismo MC Trofeo race car on display, just days before the start of the Maserati Trofeo JBF RAK race series.

The essence and all major system components of the Kubang will unmistakably be Maserati: style, engine, suspension, brakes, handling and performance are all touted to be in line with the brand's core values.

The same applies to the Maserati GranCabrio Fendi — the first major fruit of Maserati's partnership with the Italian fashion house. It has been created in the historical Maserati headquarters in Modena, Italy, with exclusive materials created in various colours solely for this project.

The sensational Maserati Trofeo is the tough new baby of a brand synonymous with motorsport since the 1920s. Race tracks across the region will resonate with the sights and sounds of grids full of Maserati GranTurismo MC Trofeo race cars battling it out.

There is plenty of Ferrari action too. "Motoring enthusiasts will have the opportunity to see the Ferrari 458 Spider, which is sure to be one of the star attractions of this year's event," says Hossam Hosni, General Manager — Luxury Auto, Al Tayer Motors. Al Tayer Motors will showcase the exciting new eight-cylinder convertible Ferrari 458 Spider, which will share the spotlight with the Ferrari FF and an exclusive customised Ferrari California that epitomises the brand's new tailor-made programme.

The new 458 Spider joins the 458 Italia, widening Ferrari's range of mid-rear engined V8s and offering the same uncompromising technological solutions, handling and performance in a refinedopen-top configuration.

Ferrari will also have an area of the stand dedicated to the tailor-made programme, enabling owners to personalise their cars to their satisfaction. The tailor-made programme provides clients with an extensive range of exclusive cloth trim, colours, finishes and technical materials.

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Numbers speak

The Middle East already has one of the highest percentages of luxury cars in the world with more than 50,000 residents owning luxury cars worth a total of Dh26 billion in the UAE alone. Market research expert IHS Automotive is predicting that sale of luxury cars will grow a further 20 per cent this year, which is more than double the overall rate of 9.7 per cent in the region. The demand has likely been fuelled by profits from oil prices, which have reached $100 (about Dh365) a barrel and an increase in the number of high-end vehicles entering the market.