Factors influencing Consumer’s Driving Behavior of Most Preferred Luxury Car Brand in Bangkok Thailand

Abstract

The luxury car market in Thailand is expected to keep expanding with double-digit growth this year (2022), despite the impact of lockdown measures implemented to contain the spread of Covid-19. Demand for cars and the purchasing power of prospective buyers remain strong in these segments, making Thailand a target market for upper-end car manufacturers. Revenue in the Luxury Cars market segment is projected to reach US$201m in 2022. Luxury Cars market segment unit sales are expected to reach 1.7K vehicles in 2026. The volume weighted average price of Luxury Cars market segment in 2022 is expected to amount to US$109,100. Luxury cars have become a commodity in Thailand due to the growing number of millionaires who flaunt their status with a prestige vehicle, even with the rapid spread of Covid-19 Omicron pandemic and rising tensions between Russia and Ukraine leading to Russia confrontation with the United States and its NATO allies. Therefore, there must be something unique about luxury car owner that makes them passionate about driving these luxury vehicles. The purpose of this research is to study factors influencing consumer’s driving behavior of his/her most preferred luxury car brand in Bangkok, Thailand. These factors include six independent first- order variables: Social Status (SS), Social Pressure (SP), Brand Personality (BP), Brand Image (BI), Brand Trust (BT), and Product (PD); three second-order latent

variables: Product (PD), Brand (BRN) and Social (SOC) and one dependent variable: Car Usage Behavior (CU). 400 sample were collected using electronic questionnaire through social media. We used second-order Structural Equation Models (SEM) for data analysis. The result shows that the RMSEA, which is an absolute fit index that assesses how far our hypothesized model is from a perfect model, for this model is .049 (<.05) which strongly indicates a “close fit” and the Goodness of Fit Index (GFI) value is .968 (>.90), the model seems to fit well according to the descriptive measures of fit. On the contrary, CFI and TLI, which are incremental fit indices that compare the fit of our hypothesized model with that of a baseline model (i.e., a model with the worst fit), whose values are both greater than .90 (CFI = .979, TLI = .900) indicating an acceptable fit. More importantly the second-order latent factors included in the model i.e. Product (PD) and Social (SOC) seem to have significant effects on influencing consumer’s driving behavior of his/her most preferred luxury car brand in Bangkok, Thailand due to their p-values are all both less than .05.