Across the world, those born between 1997 and 2012 make up Gen Z — the digital natives that every corner of the luxury industry has on its radar. The automotive sector is no exception.
For some of the world’s leading vehicle manufacturers, like Maserati and Bentley, China is home to their largest Gen Z consumer base.
In fact, Chinese luxury consumers are the world’s youngest in general, which means that luxury automotive strategies are being increasingly geared towards their needs — 2023, for example, saw premium electric car leader Tesla cooperate with bubble tea favorite Heytea in a playfully youthful collaboration to target the demographic.
It was also recently reported that Gen Z propelled car rentals in China to a record high – the cohort accounted for over half of car rentals in the country last year.
China’s luxury car market is currently valued at an estimated $154.67 billion, and is forecast to climb at a CAGR of 3.35% from 2024 to 2029 to $181.49 billion – Gen Z will be responsible for a growing proportion of that growth.
China’s luxury car market is currently valued at an estimated $154.67 billion, and is forecast to climb at a CAGR of 3.35% from 2024 to 2029 to $181.49 billion – Gen Z will be responsible for a growing proportion of that growth.
That level of influence makes those born in the 1990s and noughties an age group that luxury car brands cannot afford to overlook. But what are the demographic’s characteristics that luxury automotive makers should cater to?
Digital natives#
Seeing as luxury consumers in China are comparatively younger, e-commerce innovation and enticements are vital.
For instance, JD.com became the first digital platform globally to sell Teslas in Q4 of 2023, a departure from the car manufacturer’s direct-to-consumer model. JD.com had in September 2023 reported it would begin selling cars, focusing on electric vehicles.
As of 2021, over 60 car brands operated flagship stores on Tmall, which is a very different format of sale compared to the West, where brands do not sell via e-commerce department stores.
China’s digital natives use WeChat, Weibo, Douyin, Bilibili, and Xiaohongshu, so car brands must engage on these platforms. These channels provide opportunities for social campaigns, and also for researching consumer insights.
Competitions have become pivotal for engaging luxury car consumers in China. On December 26 2023, Tesla announced an exclusive New Year’s Eve lottery with JD.com’s omni-channel automotive division JD Auto. It included a giveaway whereby seven winners each received up to a decade of usage rights for a Tesla Model 3 Refresh Edition. There was also a giveaway of 10 Cybertrucks for kids.
Gamer favor#
China’s burgeoning gaming industry is another route for luxury automotive makers to engage the country’s youth. January 2023, for example, saw Maserati and Tencent Games’ PUBG Mobile announce a partnership that involved designing in-game Maserati cars for players.
Chief executive officer of Maserati’s licensing agency Endeavor China, Sam Huang said following the announcement, “PUBG Mobile and Maserati are both widely considered as some of the most influential and coveted brands among young generations.”
Since then, Aston Martin has also collaborated with PUBG Mobile (from July 21 to September 13, 2023). Through partnerships such as these, fans of luxury car brands who may not be able to afford a real-life model are able to virtually own one.
Getting personal#
One defining characteristic of today’s younger demographics is their desire for customizable products, and that extends to the luxury automotive sector.
In January, Bentley reported that luxury personalisation saw a major surge in China, with around 75% of consumers ordering bespoke add-ons, or expressing a desire for unique exclusivity in terms of design.
Manufacturers have taken note. For instance, German sports manufacturer Porsche presented a customized Taycan Turbo S at the Chengdu motor show in August 2023. A collaboration between Chinese artist Diny Yi and Porsche’s Sonderwunsch (special request) program, the car’s custom design aligns with Gen Z’s appreciation of individualism.
From increased digitalization, to gaming, personal touches, and rentals, young consumers in China are reshaping the market.
As the importance of this progressive, self-confident cohort increases in China, their personality traits will play an even more important role in localized brand strategies.