Mainstream brands are pulling more previously premium vehicle owners away, with the highest defectors among midsize SUVs, where average savings neared $20,000.
Driving the news: A JD Power Automotive OEM Intelligence Report found a significant shift from premium vehicle buyers to more mainstream selections.
This is significant as new premium vehicle purchases dropped from a 13.8% share of the market in the first half of 2025 to 13.3% this year, the lowest since 2020.
JD Power’s 2026 U.S. Automotive Performance, Execution and Layout (APEAL) Study highlighted that the emotional-satisfaction gap between the premium and mainstream brands had narrowed to just 29 points, a 37-point fall in the past 18 years.
SUVs most impacted: The segment seeing the biggest swing is SUVs, with 32% of buyers trading in midsize premium SUVs going away from a luxury brand.
Mainstream midsize SUVs made up 11% of those trades.
For compact premium SUVs, 30% traded to mainstream selections, including 10% to midsize mainstream SUVs.
Impact of age and income: Younger buyers were more likely to ditch the premium brand for a mainstream choice, with more than half of Gen Z buyers trading in premium vehicles making the switch.
Additionally, the data showed the retention of premium brands dropped among lower earners.
And in the midsize SUV segment, those with incomes less than $250,000 were more likely to trade in a premium brand for a mainstream model.
“Part of the story is that this needs to be seen in the context of all the other headwinds,” stated Srini Rajagopalan, vice president of OEM customer success at JD Power. “The lower household income and the younger generation cohorts are the ones that are shifting more to mainstream - likely because these cohorts are the ones more impacted by external macro factors.”
OUTSMART THE CAR MARKET IN 5 MINUTES A WEEK
Get insights trusted by 55,000+ car dealers. Free, fast, and built for automotive leaders.
Takeaway for dealers: JD Power noted premium vehicle supply peaked in April with a 76-day supply and eased in July to 67 days. Conversely, mainstream brands are at 56 days.
It also noted that more incentives are being offered to try to entice buyers back to the market, hitting 7.3% of MSRP for premium brands last month.
Rajoagopalan noted dealers need to be aware of the factors facing buyers for their inventory mix.
“Key is to understand the pricing challenges that returning customers are likely to face, especially the finance customers, and identify options for them in the showroom - the right vehicle, right purchase channel (finance and/or lease). In some cases, it may even be worth considering directing the customer to a used vehicle, if that meets the customer's needs,” Rajagopalan said.
A quick word from our partner
Smarter data drives smarter growth.
In today’s hyper-competitive auto market, precision is everything. Experian Automotive’s Marketing solutions help dealers, OEMs, agencies, and aftermarket brands pinpoint in-market and near-market shoppers, strengthen owner loyalty, increase service revenue, and outmaneuver competitors.
Activate over 1,000 syndicated automotive audiences across over 30 platforms — and enrich them with over 3,500 vertical, demographic, lifestyle & interest, and behavioral audiences.
Discover who your best buyers are, target them with confidence, and turn insights into lasting customer relationships.
