The premium compact segment[clarification needed] or small-luxury class[15] is relatively new, having been initiated by several European brands in the mid-2000s, and constitute the least expensive offerings in their lineups. These cars are targeted at a niche market of young customers who have a more refined taste in their automobiles and the means to pay for them.[citation needed] By offering a smaller, lighter, more fuel-efficient, and less expensive vehicle, this serves to introduce a younger customer to the luxury marque, in hopes of retaining the coveted customer loyalty.[citation needed] This includes the Audi A3, BMW 1 Series, Lexus CT, and Mercedes-Benz B-Class.[16][17][dead link] [18] Premium compacts may share components with mass market cars from the marque's parent company (the A3), and/or have less sophisticated platforms compared to upmarket vehicles in the lineup (such as the B-Class). The body style tends to be a hatchback or compact wagon, previously associated with economy cars but regaining popularity in the United States for its afforded utility. The luxury branding and style, high-quality interior materials, wide range of convenience features, and performance powertrains are key to distinguishing them from mass market equivalents (one mistake made by the Cadillac Cimarron) and making these appeal to consumers.[18] [19][20]
The classification varies, for instance Consumer Guide Automotive in the US considers the Audi A3 and A4 as part of the premium compact segment due to similar size and MSRP, though these are known in Europe as a small family car and a compact executive car, respectively.[21]
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