The loaded sport-utility vehicle comes with leather seats, CD, airbags, requisite cup holders and a price tag of about $36,000. The luxury car disguised as a truck has traveled far since it first appeared 11 years ago with rubber mats and vinyl seats at one-fourth the price.
"It's an image vehicle," said Jerrold O'Connor, senior VP-marketing at American Isuzu Motors.
The price of prestige is climbing in the high end of the booming sport-utility market, where brands that blazed the off-road trail-Jeep, Ford, Land Rover, Chevrolet, Isuzu and others-are dressing up deluxe trucks and going to town.
It's a trend not lost on luxury car marketers, which are scrambling to get in the game. The big marketing question is, can they stretch their brand images to include the toughness that's part of the sport-utility cachet?
"To a strong degree, sport-utilities have become luxury car alternatives," said Steve Cannon, product manager-U.S. market at Mercedes-Benz U.S. International, the Tuscaloosa, Ala.-based unit that will begin producing an upscale sport-utility in 1997.
Mr. Cannon said it's no coincidence that luxury car sales have flattened while the sport-utility segment surges, topping 1.5 million vehicles in 1994, up 13% from the year before.
"There is no loss of face in terms of image if you drive to the country club in a Grand Cherokee or a Ford Explorer, compared to driving in with a Mercedes-Benz or a BMW or Porsche," Mr. Cannon said. "You're simply saying, `That's my lifestyle. I'm an active person who goes on family outings to the mountains.'*"
Mercedes-Benz isn't the only luxury car brand shifting into four-wheel drive. Nissan Motor Corp. USA's Infiniti line will introduce a sport-utility in the U.S. late next year. BMW AG now owns the U.K.'s Rover Group, builder of the Land Rover and Range Rover models, and observers expect to eventually see BMW market a four-wheel drive vehicle.
After Ford Motor Co. revamps its full-size Ford Bronco in 1997, an upscale version will be given a Mercury badge, insiders say. Others studying entry are Toyota Motor Sales USA's Lexus, American Honda Motor Co.'s Acura and General Motors Corp.'s Cadillac.
Traditional truck marketers agree there's growing consumer interest in $30,000-plus sport-utilities. But like Isuzu, they're taking their own offerings upscale instead of giving ground to traditional luxury nameplates.
"The market is up for grabs," said George Peterson, president of AutoPacific, a Santa Ana, Calif., market research company.
"We think it's going to be difficult for luxury brands to come into the truck market," said Jeff Hurlbert, general marketing director for GM's Chevrolet. "As you move upscale, you'll find people buying a $35,000 [Chevrolet] Suburban and putting it right next to a BMW or Lexus or Cadillac in their garage."
Some observers say traditional luxury brands face a challenge but say they could leverage existing strengths.
"Ruggedness is an enormous part of the image package" for sport-utilities, said Laurel Cutler, exec VP-global director of marketing planning for Foote, Cone & Belding, New York.
However, brands like Mercedes-Benz and Lexus "represent attributes like perfect engineering and best in class," and those images would carry weight attached to a sport-utility, Ms. Cutler said. Brands like Cadillac, with images weighted more toward luxurious appointments, will have a harder time, she said.