Luxury's a risky business

There isn't room for everyone in the current luxury car sweepstakes.

Late in 1929, the luxury car market was riding high. E.IL Cord rescued Auburn, released the majestic L29 Cord and boldly financed an effort by the Duesenberg brothers to build the finest American luxury car ever. Packard, Pierce-Arrow and lincoln offered whisper-quiet V 12s. Cadillac and Marmon did likewise, and would soon launch V-- 16s. Bespoke custom bodies and limited series models were in vogue for the very wealthy.

And then the stock market crashed.

Just as the Titanic's momentum carried the ill-fated liner well past the iceberg that tore the fatal gash in its side, luxury automakers in the U.S. and abroad gamely continued production. But as the world sank into depression, few could afford these cars. Fewer still bought them By the end of the 1930s, the big-engined, highly individualistic luxury autos were passe, and World War II finished them off.

Cataclysmic events like the September 11 lth attacks have a way of crystallizing things, but often not overnight At the recent Tokyo Motor Show, Volkswagen proudly showed its sleek W-- 12; the same firm displayed the new Lamborghini Murcielago close by Both supercars will seemingly compete for the same small segment of high-end buyers.

VW, which may introduce a 1,000 hp, 190 mph Bugatti Veyron sports coupe and is also hard at work re-inventing and expanding Bentley, may have forgotten the lessons of 1929. Meanwhile, BMW is rushing to market a "made-in-Germanyuntil-we-can-build-a-state-of-the-art-plan-in-- England" Rolls-Royce -- a huge effort for just 1,000 or so units annually. Not to be outdone, Mercedes-Benz will soon try to revive the long forgotten Maybach badge.

And did somebody say high-end sports cars? Aston Martin's V-12 Vanquish is here to threaten Ferrari, whose pricey FX ups the ante even more. Aston's all Teutonic A-Team plans massive expansion. Will Cadillac really build the Cien? Is Ford serious about a revived GT40? Porsche is waffling over its $350,000-plus Carrera GT, but the company would love to do it And don't forget upwardly mobile small fries like Pagani, Saleen and Cunningham.

The population wave of wealthy 5o-60-ish folk who can step up to these cars is anxiously watch ing shaky stock markets, plunging interest rates, world religious and tribal turmoil and probably thinking they'll let the old S-Class or 7-Series make do for a lease renewal or at least another year.

High-end luxury cars have become more tech tally advanced, and thus highly service-challenged. Everything's about to be controlled by wires. Furthermore, rare woods and materials, precious metals and exotic leathers are all on the must-have list - at prices that would buy a fine home in many parts of this country Can it really last?

I think complacent carmakers are about to find out how high "up" is - particularly when you look at the ridiculous chances some are taking.

Can VW justify a V-8 Passat when it's already selling Audis? Why precipitate the aforementioned Lambo vs. VW W-12 feud? Cadillac's much-too-edgy styling, packing the Premier Automotive Group's brands into a co-located luxo-roundhouse, stretching the Star badge down to A-Class levels, and larding the oddly-- styled new 7-Series with more hard-to-learn tech than the Millennium Falcon, are all risks. You don't need a crystal ball to know some of these efforts are doomed. We are fast approaching critical mass again in the luxury car game, and this time fuel consumption really matters.

I'm not prognosticating that carmakers will shrink to just a few major competitors, though there's still room for consolidation. But I do think there are too many high-end badges for them all to survive. We've been here before.

I wonder if someday, half a century on, buyers at the Barrett-Jackson auction will be trying to outbid one another over Maybachs, Rollers Caddys and Bugattis that were made back in 2003.

[Author Affiliation]

KEN GROSS is an internationally known author and marketing consultant He has been writing about automobiles and the auto industry for nearly 30 years.