Recession Living

Luxury Carmakers Stall

There seems to be no light at the end of the tunnel for high-end carmakers like BMW, Mercedes, and Audi. Consumers are buckling down and choosing smaller, cheaper, and more fuel-efficient models as the recession drags on. "All of the luxury producers are likely to cancel product development programs, cut capital spending, cut marketing spend and ultimately cut headcount. But when your top line is down 25% to 30% these measures will not restore the business to profitability," said one analyst. Sales at BMW were off 22 percent, while Mercedes dropped 35 percent.