A lot of luxury cars really aren't that high-performance. They might have bigger engines sometimes, but they also usually weigh more so it doesn't make them much faster than a Camry. What you're getting for your money is the brand cachet, more features, nicer amenities, and a higher quality interior. The interior is probably the most noticeable difference; go sit in a $60,000 Mercedes and then compare it to some $20k regular car. There's all kinds of corners cut in the cheaper cars; crappier materials, a cardboard-like headliner, cheaper plastics, hard plastics in places, no leather, etc. In the luxury car, the seating is usually all leather (and nicer grades than the cheaper cars that have it as an option), the plastics are higher quality, there's no hard plastic where you can easily touch it, the carpet is higher quality, etc. All that stuff adds up. Plus, the luxury car will have more amenities: more and nicer overhead lights for passengers, lights you can individually turn on and off for all the seats, auto up/down windows on all doors, separate HVAC/ventilation controls for the rear seats, heated seats both in front and in the rear, etc. Finally, take a look at a luxury car like that after it's 5 years old, or even 10 years old, and compare it to a more pedestrian car of the same age. The luxury car will frequently look almost new inside, whereas the cheaper car will have things falling apart, even if it was taken care of just as well; the plastics won't age as well, there'll be more rattles, etc.