By on August 26, 2014

2013 Lexus RX 350 F-Sport, Exterior, Front 3/4, Picture Courtesy of Alex L. DykesIn July 2014, for the first time in twelve months, Lexus outsold all other premium brands in the United States. Back in August 2013, Lexus sold 29,792 vehicles, 5269 more new vehicle sales than BMW managed; 5031 more than Mercedes-Benz, excluding Sprinter vans.

Last month, Lexus’ margin of victory over the two brands which now routinely outsell the Toyota premium division was much smaller. Mercedes-Benz reported the sale of 27,192 new vehicles; Lexus another 141 units.

The annual U.S. race to be tops among premium brands was last won by Lexus in calendar year 2010. Yet as Mercedes-Benz and BMW blossomed with expanding utility vehicle lineups, Lexus’s 3-Series-fighting IS aged and the brand continued to rely very heavily on the RX.

July’s key difference relative to the recent past? Although the small NX isn’t here yet and Lexus fell back on the RX for more than one-third of the brand’s volume, the IS is now a moderately high-volume sports sedan. IS volume has increased on a year-over-year basis in each of the last 13 months and July’s 4542-unit performance marked the third occasion this year in which IS sales have topped 4000 units. IS volume increased by 901 units in July, by 5420 units over the last three months, and by 13,688 units through the first seven months of 2014.

Yet the IS, which accounted for 17% of the brand’s volume in July, was only Lexus’s third-best-selling model. The ES, sales of which rose 4% (and are only slightly less than level year-to-date), generated 6326 July sales, more than four out of every ten Lexus passenger car sales last month. The ES – with its entry-luxury price tag, front-wheel-drive orientation, and spacious interior – has no genuinely direct rival at Mercedes-Benz or BMW.

Lexus July 2014 sales articlesThe GS, on the other hand, does stand up as an E-Class or 5-Series challenger, though not on U.S. sales volume terms. 2001 GS sedans were sold in July, a 16% year-over-year increase. With larger lineups (the E-Class is available in four different bodystyles, for example), Mercedes-Benz sold 6648 Es in July, a 19% jump, and BMW sold 5676 copies of the 5-Series, up 17%.

While BMW sold 6187 versions of their five X models in July and Mercedes-Benz’s G, GL, GLK, and M-Class combined for 9038 sales, Lexus sold 9658 RX hybrids and RX350s. (Lexus also sold 1955 GX SUVs, representing a 122% increase. LX sales fell 15% to 248 units.)

Among premium brand utility vehicles, the RX is an astonishingly and consistently popular nameplate. RX sales jumped 14% in July and are up 5% year-to-date.

It’s on the basis of the RX’s success that Toyota feels it can sell 2200 NXs per month. Challenging styling aside, it’s hard to doubt the company’s expectations. To the NX’s extra volume, Lexus will also add a few sales with the RC.

If those figures cause you to think Lexus could return to the top of the heap more consistently and for the long-term, you wouldn’t be crazy. But you may also be forgetting that Mercedes-Benz will soon be selling a sub-GLK GLA. The race among upmarket brands to generate increased sales, and thus decreased exclusivity, requires many a move down-market.

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82 Comments on “Lexus Topped Premium Brands In The U.S. In July, And How...”


  • avatar
    Dragophire

    I am curious to see what three name plates carry BMW sales as well as MB. Lexus front wheel drive platforms have always carried theirs.

    • 0 avatar
      Timothy Cain

      At BMW this year, the 3-Series/4-Series, 5-Series, and X5 account for 69% of the brand’s U.S. volume. (3er/4er equal 38% alone.) Excluding Sprinter, the C, E, and M account for 59% of Benz volume.

      • 0 avatar
        bd2

        The 5 Series and X5 are on a different price-point from the ES and RX, the mainstay sellers for Lexus.

        BMW has sold 38,548 of the 5 and 7 Series compared to 16,701 of the GS and LS YTD.

        And can add another 5,717 of the 6 Series on top of that.

  • avatar
    Quentin

    Glad to see the IS doing well on the market. I think the IS350 F sport is simply a fantastic car. It looks great and is a lot of fun to drive.

  • avatar

    Say what you want about the ES, but it is indeed a comfortable, large sedan with a far more luxurious interior than anything that the Europeans would sell at any price point in which said ES resides, and therefore—as you said—the ES has no direct rival from the Euro brands. Me, I wouldn’t buy the ES at all on the grounds that I like the Avalon’s styling better and it’s less-expensive to boot. But if I was shopping in the $40K-$45K range, I’d have a hard time coughing up what the Euro brands want for their cars.

    Also, I do wish the GS received more recognition. It’s my favorite Lexus, by far.

    • 0 avatar
      sportyaccordy

      The success of the RX and ES are demonstrations of what happens when you stop building to mindless expectations (“we need a halo car” “we need to compete with the Germans” “we need our diesel 3 fighter to have the lowest Ring time in the class”), and build to what customers want.

      The ES and RX are easy to drive and own, and are pretty much free of pretense or compromise with respect to what their respective customer bases want. Both cars are pretty much the antithesis of my automotive tastes; however I have tremendous respect and admiration for Lexus in their understanding of their customers’ needs, and their ability to execute and continually improve on the concept and products for those markets.

      Cadillac needs to look to Lexus for ideas on how to run a second tier luxury marque… they need a bold, PHEV American ES, and an NX/RX way more than some Ring carving 3 and 5 fighters. Lexus is improving and continuing in those segments pretty much because there is money there…. but the real bread and butter for the brand is obvious in the charts.

      • 0 avatar
        dal20402

        There’s a Catch-22 in what you’re suggesting and Acura shows it pretty perfectly.

        Acura, just like Lexus, is relying on an inoffensive crossover and FWD-based sedans to pay most of its bills. But Acura is seen as a pretender while Lexus is seen as a “real” luxury marque. And the only reason for the difference in perception is the LS and GS, two RWD sedans that were expensive to develop, sell minuscule numbers of copies, and really don’t represent the bulk of the brand at all.

        Cadillac is basing its strategy on that difference. It knows that if it wants to sell Lexus-style numbers of SRXes and future Lambda-derived large crossovers to people richer than those who buy RDXes it has to be seen as a “true” BMW rival. It also knows the only way to get there is by building RWD sedans that no one buys but that the press fawns over. It’s a long-term brand management strategy.

        • 0 avatar
          VoGo

          Sporty and Dal,
          I love the debate! I honestly don’t know who is correct, but you both lay out credible perspectives. Thanks!

        • 0 avatar
          FreedMike

          “And the only reason for the difference in perception is the LS and GS, two RWD sedans that were expensive to develop, sell minuscule numbers of copies, and really don’t represent the bulk of the brand at all.”

          I’d say that’s true of the LS, but not the GS – per that chart above, it’s selling at a 24,000 unit per year clip, which is a long way from miniscule.

          The IS is also RWD and sells in far larger volumes (it’s on a pace to sell over 50,000 units in 2014 per that chart).

          But I like the thrust of your argument – for Lexus to survive against the likes of BMW and Mercedes, it has to offer performance-oriented RWD sedans with a distinctive driving flavor. They don’t necessarily have to be M3/M5 or AMG killers, but they do have to provide an involving driving experience. That’s what modern luxury is. Previous generations of the IS and GS didn’t do that, and sales suffered.

          • 0 avatar
            dal20402

            Yes, the 2013 refresh helped GS sales quite a bit. It’s still far from paying the bills, though — it sells a fraction of what the ES and RX do.

            For my money, the MDX is a solidly more desirable vehicle than the RX (albeit a bit bigger) and the RLX is similarly more desirable than the ES (although priced too high). But the ES and RX, especially the ES, have far more cachet at the country club. The only reason is because Lexus sells small numbers of LSes and LXes.

            I’m sure that Cadillac is hoping that the CTS and upcoming LTS (?) will do the same, over time, for its crossovers.

          • 0 avatar
            bd2

            The GS is selling at a 20,782 a year clip.

            And while sales are up compared to last year, that’s b/c Lexus has upped the discounts.

            The current GS has yet to come close to the top sales nos. for the previous gen (33.5k).

        • 0 avatar
          sportyaccordy

          Acura/Lexus diverging trajectories have nothing to do with “RWD sedan credibility”. It all comes down to styling. In the early 00s the TL was about 20K behind the ES in US sales. When the 3rd gen 2004 TL came out, which was gorgeous, it gained sales parity with the ES. The 4th gen TL (the big bloated one with the beak) came out in 2009… people can claim its sales sucked because of the recession, but the ES sold 40-50% more through the same period and has rebounded back to pre-recession levels, while the TL has actually continued to slide.

          Mind you, when the ES and TL were neck in neck in sales, Lexus had long established its “RWD sedan credibility” with the IS/GS, and its credibility as a brand period with the LS. But even with all that, its FWD luxocruiser was neck and neck with an equally expensive offering from a luxury “nobody”. Nobody looking at an ES says ‘hmmm i like the TL but im gonna go with the lexus because they make RWD sedans i dont care about and will never buy’. But they DO look at the TL and say ‘MY EYES! O GOD MY EYES!!!!!’

          Cadillac has had a sedan that could fight with the Germans for a good decade now. If they want to keep chasing “credibility” while being a loss leader they can go down your path. But if they want to have profitable volume and build cars people actually want they have to look outside of the German 3/5/7 architecture. The Germans are…..

          • 0 avatar
            dal20402

            You have a point on the styling. But credibility is also an issue, and was even when the 2004 TL was selling like gangbusters. I had a 2004 TSX and no one understood what Acura represented even at the time, while that was the heyday of the Lexus image.

            People don’t express it as “Lexus is better because it makes big RWD sedans.” They express it in disjointed ways, like “Lexus is as fancy as a Mercedes” or “Acura… what is that… isn’t it a fancy Honda?” Brand opinion is driven by hazy perceptions which are a mix of critical opinion, product observed on the street (every LS and LX people see makes them feel better about Lexus), and word of mouth. Acura has gotten a lot of bad press in the motoring press because it doesn’t have a V8 RWD flagship, and people don’t see huge and imposing Acuras on the street. All of that matters.

            Every CTS, LTS, and 2015+ Escalade on the street (the Slade is a lousy product, but the bling sure looks right) will help both the on-the-street perception and the reception of the Cadillac brand in the press. The end goal is, without a doubt, to increase sales of SRXes, ATSes, and the upcoming large Caddy crossover. But when the brand is as damaged as it is, it has to take steps to be taken seriously again, or it will be in a worse place than even Acura, and it won’t sell anything.

          • 0 avatar
            bd2

            At the same time, Acura never gained any traction with the RL/RLX.

            There are limits inherent to the FWD-based sedan once you reach a certain price-point.

            The TL was a midsize sedan sold at a compact price – which is what many buyers are looking for (see ES, MKZ, etc.).

      • 0 avatar
        FreedMike

        Interesting you’d say Lexus isn’t trying to compete with German brands…when it clearly, obviously is. Why do you think the new GS and IS lines are far more involving driver’s cars than they were before? To compete with, respectively, the E-class, 5-series, C-class and 3-series.

        I sampled the old GS and IS, and they were roadgoing sensory deprivation tanks – competent but boring to drive. Sales languished, particularly for the GS. And now that they’re providing a more involving (dare I say BMW-like) driving experience, sales are solidly up for both models.

        The market is moving away from the rolling isolation chambers that Lexus built for so many years. Yes, they’ll still build the ES, and it’ll continue to sell, but if wants to really compete against BMW and Mercedes, it has to make cars with an involving, compelling driving experience.

        • 0 avatar

          Meanwhile… CLA and Sport Tourer from Merc and BMW respectively. Beacause if you want a driving experience, you buy a Corvette or something.

          • 0 avatar
            dal20402

            Or you upsell to the C or 3/4.

            Luxury brands are calculating that sales growth is worth a bit of brand dilution at the bottom of the lineup. And Lexus’s experience would seem to support that idea — it continues to be perceived as a luxury brand on the strength of its high-end products even as its volume products are an Avalon and a Highlander with nicer interior materials.

          • 0 avatar
            bd2

            And the sub-entry CLA probably has a higher ATP ($38-39k) than the Lexus ES which is based on a full-size platform.

        • 0 avatar
          bd2

          Sales of the much sportier current GS are down from the more pedestrian driving previous model.

        • 0 avatar
          sportyaccordy

          How is building an involving, compelling driving experience = competing with BMW and Mercedes, when BMW is moving away from that driving experience, and Mercedes never had it outside of their AMG models?

          My 2 rides are a 350Z and a motorcycle… I live and breathe driving involvement. So don’t take me as a fan of a snoremobile. However, I think you are projecting your desires as what it takes to succeed. The average luxury buyer doesn’t care about driving involvement… if they did BMW would not have dialed down the sportiness a couple of notches and increased sales volume like it did.

        • 0 avatar
          stuki

          The European makes would beg to differ wrt market moving away from rolling isolation chambers. In practice, “the market” looks to be moving towards just what Detroit build back in it’s halcyon days; large, outrageously powerful rolling isolation chambers. With the lone quirk of simultaneously garnering rave reviews on Top Gear, for at least some of a brand’s cars.

          The utterly insane levels of low buck whoopass directed their direction by Detroit in the next few years, may cause the Euro marketing machines to again retreat behind the wall of “size and power is vulgar” sentiment they originally crawled out from at the start of their climb to the top. But for now in Euro land, the more you spend on a car, the closer in spirit to a 60s Caddy or Big Block ‘Vette it gets…..

      • 0 avatar
        CoreyDL

        Why hasn’t Honda done this with Acura? There are plenty of old peeps out there in EX-L’s who would upgrade to a softy Acura with decent styling.

        • 0 avatar
          dal20402

          The TLX V6 FWD and RLX FWD are both good candidates. The RLX in particular would be perfect except that it’s just a touch expensive. If you took $5K off the RLX FWD MSRP, the base version would be a great ES competitor.

          • 0 avatar
            CoreyDL

            I think the RLX styling is a bit scary to old people. Their ES can match their beige comfort pants!

          • 0 avatar
            dal20402

            The only thing less than completely vanilla about the RLX styling is the multi-LED headlights. Even the beak isn’t really noticeable at this point. If the RLX isn’t beige enough… that’s a sad thought.

      • 0 avatar
        bd2

        At the same time, Lexus is struggling to sell its higher end RWD sedans.

        Cadillac does not need to look to Lexus for “ideas” when it comes to FWD luxo-cruisers since that’s what Buick is for (notwithstanding the XTS).

        And Cadillac sells around 4k sedans in the mid-price range with the CTS and XTS sedans – more than twice what Lexus is doing.

        • 0 avatar
          sportyaccordy

          Lexus doesn’t have an XTS competitor, and YTD the GS is outselling the CTS by about 50%, without the incentives Cadillac has to put on the hoods of its RWD entrants to get them out of the door. Cadillac is the one struggling here.

          • 0 avatar
            bd2

            The fact that Lexus doesn’t have an XTS competitor is Lexus’ fault since the ES easily could be now that it is based on the full-size Avalon platform.

            Also, while the E Class and 5 Series are way ahead of the CTS in sales, the CTS has an ATP that is not far off the pace and that’s without the new CTS-V.

            And I highly doubt that the GS is outselling the CTS sedan at all, much less by 50%.

            YTD, Cadillac has sold 18,047 of the CTS to 12,123 for the GS.

            CTS coupe sales only make up around 150-200 of sales monthly and the wagon practically nothing, so if anything the CTS sedan outsells the GS.

            So the CTS is selling as well, if not better than the GS and that’s even with another model, the XTS, in the same price-range.

            And you must have missed the cheap deals that Lexus has been offering on the GS.

          • 0 avatar
            sportyaccordy

            I’m not sure why you think the XTS and ES don’t compete. They share the same wheelbase and width, and have the same interior dimensions for the most part.

            http://autos.msn.com/research/compare/default.aspx?c=0&i=0&ph1=t0&ph2=t0&tb=0&dt=0&v=t118024&v=t119770

            YTD the ES has outsold the XTS about 3:1. I don’t know what your source is but the CTS has sold 8,047, not 18,047, at least according to Goodcarbadcar.net. So no, the CTS is not selling well (and neither is the GS), nor is the XTS (I’m sure a lot of its sales go to fleets). I’ll bet Lexus’ net profit on the ES is higher than Caddy’s on the XTS despite the higher prices. Caddy’s revival is all wrong and the sales and rebates show it.

          • 0 avatar
            bd2

            That’s b/c Toyota had the chance to move up the ES in price/luxury when they switched the ES from the Camry to the Avalon platform but they didn’t.

            The XTS starts at $44,600 whereas the ES starts one price-segment lower at $36,620.

            The XTS also has AWD which allows for more powerful editions such as the V-Sport Platinum which starts at $69,785.

            The interior of the XTS is on par with that of the CTS and not the ATS.

            The interior of the ES is on par with the IS and is not close to that of the GS.

            The XTS competes with the RLX and the MKS.

            The ES competes with the TLX, MKZ and LaCrosse.

            As for the GCBC stats – it’s a typo (should be a 1 before the 8).

            Aside from making the rear of the ATS too tight, Cadillac’s resurging sedan lineup is on track.

            Again, the CTS outsells the GS and has a higher ATP – and that’s despite having the XTS in the same price-point.

            And in 2013, 27,500 XTS sold were to retail compared to 19,500 for the GS.

            Due to the costs savings of the XTS FWD platform, GM made a good bit more on the XTS than Toyota did on the GS.

      • 0 avatar
        Pch101

        Lexus lacks cachet value, which constrains its profitability and hinders its efforts overseas. Overall, the Germans are in far better shape as global brands.

        Lexus has done a fantastic job of burying the American luxury badges — TMC knows how to divide and conquer the US market, with full-size trucks as the final frontier.

        But otherwise, the Germans still get to make the rules. And success with halo cars that very few people will buy is one of the reasons that the Germans can claim that position, along with the pricing that comes from it. If you started a luxury car brand today with the hope of world domination, then you’d aspire to be like one of the Germans, not like the Japanese.

        • 0 avatar
          sportyaccordy

          The fatal flaw is that the rules that enable the success the Germans see, only applies to the Germans. So aping them will never work.

          If you want to start a luxury brand today that will be sustainable and make money, you have to make cars people will buy. Whether or not they mimick German offerings. If anything, Cadillac’s struggles show that aping the Germans is not a guaranteed win.

          • 0 avatar
            Pch101

            You’re confusing the vehicles with the positioning and marketing of the vehicles.

            The point is that the Germans create distinct related families of cars that include halos within them.

            That has the benefit of creating an aura of authenticity that then translates into mainstream sales, even though most people will never get close to either the highest end of the chain or the halo. The regular customers who buy the more normal cars will consequently pay higher prices for them.

            The Japanese have generally had a difficult time getting people to pay luxury prices for their vehicles. They can fetch a premium over the Americans, but they can’t keep up with the Germans.

            Aping German cars is a losing game, since the Germans are already known for being German. But borrowing from the approach to positioning is how the game is obviously played and won; those who don’t do it suffer accordingly.

            Incidentally, Nissan used a halo car to save itself when it brought back the Z. Not a strong seller, but it helped to build back the reputation.

            VW may have withdrawn from the US altogether had it not been for the New Beetle. Proof that a halo car doesn’t necessarily need to be pricey; that car helped VW to sell a lot of Jettas.

          • 0 avatar
            dal20402

            It’s a long game. Cadillac is trying to ape Audi, which wasn’t always one of “the Germans.”

            Audi built the first V8, its first attempt at a no-compromise luxury car, in 1989. It sold horribly, even though it really wasn’t a bad product. (My dad owned a ’92 which saw 130+ mph on the autobahn with me behind the wheel and lasted without major problems for 150,000 miles.)

            They achieved a bit of cool factor with the first B5 A4 in 1995 (1996 in the US), but weren’t taken seriously above what would today be the $40,000 price point. Kind of like Acura in 2004, they were a near-lux mark for strivers, a full level below Benz/BMW and even Lexus.

            But they continued pumping out A6s and A8s. And, bit by bit, they gained luxury acceptance.

            The C6 A6 brought a new level of acceptance in what would be the $60,000 market today with its mid-cycle refresh, where the 2.7T and 4.2 engines were added. The D3 A8 likewise got some respect as the first full-size luxury sedan that placed well in S-Class and 7-Series comparisons. But even then it took another generation. The D4 A8 finally cemented Audi’s arrival as one of the German Big Three.

            The result: Today, A4s and Q5s (which make up the vast, vast majority of Audi’s US sales) are considered luxury products and command vastly more public respect than A4s did just a decade ago.

            Cadillac is trying to follow a similar long game. Each CTS has gotten better press than the last, and the current one is finally being recognized as a true BMW/Mercedes peer in the press. Now they are trying to create a full-size flagship and to bring the Escalade up to perceived luxury parity with the GL and Q7. Of course the goal here is to imbue the volume products (ATS, SRX, future CUVs, maybe XTS) with greater perceived prestige so they can command higher prices, just like Audi did with its volume products. They’re not dumb enough to think they’re going to sell 50,000 CTSes or LTSes.

          • 0 avatar
            sportyaccordy

            Pch101- there is no contrived aura of authenticity for BMW/MB. They are the real deal. MB has been making cars for over a century and has been making luxury cars for over half a century. BMW invented the sport sedan and has a long legacy of motorsports heritage. So there is nothing to contrive, they are authentic.

            Halo cars are BS… for example, Toyota has no halo car, but the Corolla outsells the Sentra 3:1. And even with the Versa outselling the Yaris, I don’t think anyone is saying ‘i like the yaris, but im gonna go with the versa because nissan makes the gt-r’. Its more likely, they go with the Versa because its interior is about as big as the average inner city living room. If anything saved Nissan, it was either the G35, or the 2002 Altima, which turned that model from a weird also-ran to a full on midsize contender. And there are sales figures to prove it. Lets not revise history to fit our preconceptions.

            dal20402- again let’s not revise history. The A4 and A6 came out within a year of each other and were instant hits. I don’t have sales figures for the B4/C4s, but I doubt they were anywhere near this strong:

            http://en.wikipedia.org/wiki/Audi#Production_figures

            Audi succeeded for a few factors that are not present for Cadillac…

            – they carved a huge niche with quattro. In 1998, barring a handful of E-Classes, there were no luxury cars available with AWD that weren’t by Audi.

            – they had little to no competition. It was just MB, BMW, and to a lesser degree Lexus. Acura and Infiniti were at their lowest respective points, Cadillac was a complete joke, Volvo and Saab were non-entities in the “real” luxury realm.

            – they had a clear identity/narrative.

            Cadillac brings nothing tangible AND unique to the table, and it is trying to penetrate a fiercely competitive, fully mature market. Cadillac’s situation now is unlike any that of any luxury manufacturer who has made it- Lexus, Audi, Infiniti, hell even BMW- all came in when the markets were wide open, and came into the market with unique, niche carving, segment creating product that created a lot of value in the marketplace. You can’t say that about what Caddy is doing now.

          • 0 avatar
            bd2

            Ever since the Germans have gotten their act together, the Japanese have been struggling to sell mid-full RWD sedans (not to mention the Koreans now undercutting the Japanese).

            Lexus once sold 50k+ of its RWD GS and LS models.

            Nowadays, Lexus sales are more than ever reliant on their cheaper FWD models.

            Take away ES and RX sales and Lexus sales nos. aren’t that far off that for Infiniti.

            Say what you will about Cadillac, but Cadillac’s future in higher end sedan sales in brighter than that for any of the Japanese brands.

            Cadillac already does double that of Lexus in mid-price sedan sales.

          • 0 avatar
            Pch101

            “there is no contrived aura of authenticity for BMW/MB.”

            I see part of the problem here — you just don’t “get” marketing. You think that marketing and branding are fake concepts, when they are tools for communicating a coherent message to the customer so that the customer is more likely to want to make the purchase.

            The product is more than just the nuts and bolts that are used to build it. The brand helps to sell it, as the brand helps to define what it is and to set expectations.

            The Germans have figured this out. Lexus is learning (slowly), and Acura is next to clueless. You could apparently work for Acura, as they clearly don’t grasp these concepts at all.

          • 0 avatar
            sportyaccordy

            bd2 you are right about the CTS. I checked. No rebates there either. But the ATS is off the mark for projected sales and has pretty steep rebates. $3K on average. ATS is selling 3K under invoice on average. No bueno.

            Pch101 I am from NYC. It’s not that I don’t believe in marketing. I do. My wife is in marketing. It’s just that good marketing starts with good product and actually having what people want. From there it’s easy. In the luxury realm most customers want brand equity, heritage, a familiar name etc. Brands like Lexus and Cadillac don’t have that, and no amount of marketing can change that. That is why Lexus’ best sellers are offerings the Germans simply have no answers for. They made product people wanted that the Germans couldn’t offer, and people bought in.

            You are the one who is mistaken here. You think good marketing can overcome bad business.

          • 0 avatar
            Pch101

            “You think good marketing can overcome bad business.”

            Perhaps you meant to respond to someone else, as I never said anything that was even remotely close to that or could have been intelligently interpreted in that fashion.

            The point is that the vehicles need to be part of a coherent lineup that collectively stand for something. Otherwise, it isn’t a brand, just a collection of products. And people are generally willing to pay less for a random product than they would for something else that carries a strong and positive brand association with other premium goods.

            The Germans have a coherent approach to this. Lexus only does to a point and Acura doesn’t grasp this at all.

          • 0 avatar
            bd2

            @sportyaccord

            Yes, the ATS has rebates and isn’t selling as well as Cadillac has hoped but the fundamental flaw with the ATS (as I had stated) is having the tightest rear passenger room in the segment.

            GM made the exact same mistake with the current Malibu (based on reports, seems like the next gen ATS and Malibu will rectify that and increase rear passenger space).

            Nonetheless, despite lower than projected sales, the ATS does alright when it comes to ATP.

            For the 1st 6 months of the year, the ATS had an ATP that was only $1k less than for the C Class (will change with the new, more luxurious C Class) and $2k more than the A4.

            And that is w/o a V-Sport, much less an ATS-V model.

            While the Lexus IS sells more (Toyota learned its lesson and boosted rear passenger room from the previous gen model), the ATS probably has the higher ATP since 90% of IS sales have been for the IS250 and it has been selling for around invoice pretty much since its launch.

        • 0 avatar
          05lgt

          Lexus is a sub-brand of TMC. Mercedes and BMW are what they are. Overall, TMC sells more cars than BMW or Mercedes. That Lexus doesn’t compete with BMW or Mercedes globally, where they have long sold down market non-luxury cars doesn’t mean much. They’re playing in Toyota’s pool there, and not winning. In the US, the Germans are still (or again) ahead of Lexus. But it’s getting competitive.

  • avatar
    alsorl

    Outstanding lease deals on the ES is the main reason for those sales. $349 a month and I think some of those leases are going to some not so perfect credit scores.

    • 0 avatar
      stuki

      That’s what Toyota residuals nets you….

      Unlike BMW and other lux brands, Toyota has not traditionally provided massively supported leases.

      The ES is a Camry, the safest car on the planet to buy used, since they cost less to maintain at 20 years and a million miles, than most others just one mile out of warranty.

    • 0 avatar
      haroldingpatrick

      This combined with the Nascar/pickup marketing has the potential to hurt Toyota long term in North America. The snobby upper middle class will drop their ES350’s, RX350’s, Highlanders, Prii, etc if the country/working class folks embrace Toyota/Lexus in a big way. This is the real problem Detroit has – a large segment of new car buyers flat out will not consider their products due to the customer demographics of those brands. Lexus can be Buick if they are not careful.

    • 0 avatar
      genuineleather

      $349 plus TTL and a $4k down payment, maybe. Even then you’re talking about a stripper model with pleather.

      Decently equipped and with a more representative down payment, an ES/RX lease will run $6-700/mth. Lexus doesn’t subsidize leases anywhere close to the Germans.

  • avatar
    CoreyDL

    As far as I’m concerned, the beautiful red pearlcoat on that RX is being ruined by those dark wheels. Blech.

  • avatar
    bd2

    It’s not merely how much a luxury auto brand sells, but how much of what.

    Mercedes has sold 54,395 of the E and S Classes YTD.

    Lexus has sold 16,701 of the GS and LS YTD.

    Mercedes has sold more of the S Class than Lexus the GS.

    • 0 avatar
      highdesertcat

      Although it is highly doubtful that I’ll ever be able to scrape enough money together to buy an LS, at least it is something to aspire to.

      While the brands you listed are all excellent, indeed outstanding vehicles, many people who buy the LS believe that the LS model is ideally suited to American driving styles and American roads.

      • 0 avatar
        bd2

        Still, there’s a reason why the S Class has a $20k+ premium over the LS and despite that, is selling 3-4x as much.

        • 0 avatar
          highdesertcat

          Yes, I agree. They each attract a different demographic.

          The S-Class is engineered for worldwide appeal and can run wide open on the Autobahn all day long.

          The LS, OTOH, is designed for American driving and the American highways and byways.

          Both make a cachet and social-standing statement, but each in their own way.

          And as someone rapidly approaching the age of 70, I don’t need what the S-Class offers, but prefer what the LS was designed for.

          I have several friends who own an LS, albeit of varying years going all the way back to the LS400, but they still treasure them to this day.

          Many of those friends used to drive Lincoln and Cadillac, but no more. Most of them are retired military and are quite familiar with Mercedes and BMW offerings. Still, they chose the LS.

          Nirvana is also in the eye of the beholder.

          • 0 avatar
            bd2

            While that may be kinda true (it’s not like the S Class is like some Panamera fighter), the days of the LS selling 30k+ a year are over.

            And right now, American buyers seem to overwhelmingly prefer the S Class to the LS even despite the price premium.

            Yes, sales of the LS should rebound some when Lexus finally launches an all-new model in a couple of years, but not only will BMW, Cadillac, Jag, etc. have their new flagship sedans, Hyundai and Kia will have their new flagships as well (with Infiniti purportedly re-entering the game, albeit more on the sport side with a Panamera fighter).

            Speaking of the Panamera, the early reports are that the next gen LS is going a bit towards that route as well.

          • 0 avatar
            sportyaccordy

            I think the difference just comes down more to brand. The higher the price tag the more it matters. In that regard the S-class is on a whole other level. Plus the current S-Class has really widened the gulf in design, build quality and technology from the LS, though I would say the last one was still well ahead as well.

            I think both cars are equally suited to American roads… if anything, S Class might have the edge as Mercedes’ suspension technologies are cutting edge. In any arena the S has an objective edge over the LS, and it has a stronger brand and (IMO) better design in and out. Its not the 80s anymore.

          • 0 avatar
            highdesertcat

            I agree that the days of the LS selling 30K+ a year are over, never to return. Many more and better choices these days.

            But what I see happening is that the LS demographic is also changing. EVERYONE I know who owns an LS, regardless of model year, is OLD!

            I’ve never seen anyone under age 60 driving an LS, regardless of model year.

            Then again, even the active duty military guys and gals driving Mercedes cars purchased while they were stationed in Germany (or anywhere in Europe like Belgium, England, Italy, Norway, the Netherlands, etc) mostly drive the E-Class.

            I don’t know any active duty military people who drive an S-Class, not even the senior officers. Mostly, it is the E-Class.

            The younger GIs who choose Mercedes mostly drive the C-Class.

          • 0 avatar
            sportyaccordy

            I think the whole F segment (S class, 7, LS) is for old people. The whole concept is a little silly. Why spend 6 figures on a car that doesn’t stand out, is boring to drive, and isn’t very practical? For all the vitriol stemming from its existence, an X6M, or even something like a Range Rover or CLS deliver more bang for the buck. I lived in the UES of Manhattan for a few years; not far from where all the big bank execs lived. They bought the S class and LS etc as cars to commute in. Their own personal cars were just as expensive but way more varied and interesting.

            Sedans in general are becoming a bit old hat. My wife’s Rabbit is great and way more practical than a Jetta, and when we go out fits in pretty much any parking spot. Wagons are good. CUVs are good. Coupes are sexy. Sedans are more practical than coupes but that’s really it.

          • 0 avatar
            dal20402

            sporty, I agree with you that sedans are starting to be old news in the mass market (and I find it depressing as I personally like them much better than hatches or CUVs for passenger transport).

            But I think they are still one of two categories that continues to define luxury makers’ reputation, the other being large SUVs/CUVs.

            Thus the spectacle of makers spending billions of development dollars on… well, pretty much any full-size luxury sedan other than the S-Class. None of them will make it into 5 digits of sales, while all of them continue to be critical to the luxury image of the volume products.

          • 0 avatar
            sportyaccordy

            dal20402-

            I just don’t buy the halo car effect. For example Caddy and Infiniti don’t have halo cars, but the CTS and M outsold the Jag XF for a few years. The Lexus ES outsells cars like the MKS and TL not because those brands are weaker, but because for its segment it’s the best car. Infiniti’s fortunes turned around as soon as it dumped its “halo car” (Q45) and focused on the cars and segments where people are actually buying. At the end of the day, it’s still business, and the idea of throwing billions of dollars at flagships nobody buys or cares about while staying out of important segments or not building cars people want in high volume sectors just doesn’t make any sense.

        • 0 avatar
          28-Cars-Later

          LS4xx is a somewhat conservative choice, not nearly as gaudy as a Mercedes S-class. Gaudy sells.

          • 0 avatar
            highdesertcat

            Totally different ride and handling, too. Much more feedback in an S-Class.

            Driving an LS is like driving a tomb; quiet, smooth, unobtrusive and mostly isolated from road, noise, vibration or harshness.

            It’s like sitting in your easy chair in the den, watching the world go by. But a great long-distance traveler.

      • 0 avatar
        stuki

        And it still has a proper powertrain. Sans turbos. Which makes trolling around in the city, particularly one as hilly as SF, much simpler for the right foot to do smoothly. Even with a drivetrain as generally smooth as the new 4.0/8 speed in the A8; parallel parking on a steep downhill, exposes the inevitable non linearity of turbos coming on and off boost. As does bumper to bumper uphill crawling. Then throw in hill holding brakes with too high release thresholds…..

        • 0 avatar
          dal20402

          I drive a turbo Forester in Seattle, every bit as hilly as SF, and can’t say I’ve ever had an issue with “non-linearity of turbos” when parking or in stop-and-go on hills.

        • 0 avatar
          sportyaccordy

          The x550 engine is a V8 with 2 tiny turbos hooked up to an 8 speed auto… lag is not an issue, this isn’t a Corvair with a 3 on the tree.

    • 0 avatar
      genuineleather

      Two big reasons the LS is such a slow seller these days:

      -It’s old. Same basic car since ’06, giving little incentive for people to pony up for a new one. Worse, people who lease are turned off by the idea of getting the SAME CAR for going on a third(!) time if they’re on a 36/mth cycle

      -It’s way more expensive than it used to be. Not that long ago, a loaded LS could be had for $65k while an S-class ran $100k+; now, an LS can easily push $85k. Add to that Lexus’ reluctance to subsidize leases (a topline LS will actually cost MORE per month than a substantially pricier 7/S) and you have a recipe for tiny sales.

  • avatar
    Mandalorian

    I really don’t see a whole lot of new GS, LS, IS or LX on the road. Tons of new RX, a few ES and decent numbers of GX.

  • avatar
    waltercat

    As SportyAccordy and Kyree Williams correctly point out, the ES is indeed big, comfortable, luxurious, and easy to get along with. Earlier this month, I took delivery of a ’14 ES, to replace my aging but beloved ’99 TL. Amazing what 15 years worth of advancements buys you! Toys that weren’t invented yet when the TL was new. Significantly more power and better gas mileage. A million more safety features. A whole generation of NVH refinement. And more…

    Lexus (which wasn’t my initial first choice) won my hard-earned dollars with superb workmanship, the best record for reliability, some of the best car seats I’ve ever seen, silent running, and a dealership experience unlike any I’ve ever seen. I’m thrilled with the car – it’s no sports car, of course (well, duh!) but it may be the classiest long-distance cruiser in the price range. I think this one will be with me for a long while.

    One other little thing – I had looked at an Avalon just before buying the ES – I was underwhelmed, but thought it was a solidly good car. But the actual prices for comparably-equipped cars was within 5% of one another. The additional glamor of the ES (and the better dealership) were worth a couple of extra bucks to me.

    • 0 avatar
      sportyaccordy

      Now I have a question for you. Why didn’t you look at the ATS/CTS? Don’t you care about Nurburgring tuning or Brembo brakes? (big grin emoji)

      Seriously though, I am curious as to why you bought the ES over something “sportier”, or from a manufacturer with more “brand cachet”. Like I said, I think the ES is a great car, and it makes sense to my why they outsell literally every other midsize luxury offering in the US, but it would be interesting to hear it straight from the source.

      • 0 avatar
        danio3834

        waltercat said: “Lexus (which wasn’t my initial first choice) won my hard-earned dollars with superb workmanship, the best record for reliability, some of the best car seats I’ve ever seen, silent running, and a dealership experience unlike any I’ve ever seen.”

      • 0 avatar
        waltercat

        Great question. The kind of driving I do – highways and New York metro area – don’t give me a lot of opportunity for “sporty” driving (and on summer weekends, I have a Miata for that). I’m one of those throwbacks who likes FWD – I really don’t need AWD, but I like getting around in the winter. I like room and comfort, and that excludes any “sportier” cars that I can afford. And I run cars a long, long time (my outgoing TL was coming up on a quarter-million miles) so I value reliability, longevity, and build quality. Frankly, another Acura would probably have done the trick, but they are beyond ugly. Fugly.

  • avatar
    VenomV12

    Even though I don’t really care for Lexus’s current crop save the RX, I think they strayed too far away from the soft comfort cars, they just work and people that love them are loyal to them forever. Most of my friends and neighbors that have RXs usually own two, I have a neighbor with 3 RXs, just got rid of one last week and brought home another new one, plus they have a GX and a GS. They are comfortable luxury vehicles and you can drive them for 10 plus years and do almost nothing to them, something you will not be able to do with the Germans or American vehicles. I quite a few guys that own LXs and their wives drive fully loaded Siennas, if Lexus really wanted to up their numbers, they would make a Lexus version of the Sienna and I bet their numbers would rise quite significantly.

  • avatar
    Brock_Landers

    GS is not selling as much as 5-series or E-class, because Lexus has the ES. If ES would not exist in Lexus lineup, then most (not all) of current ES customers would buy the GS.

    Current LS is 8 years old model, with some minor and one major face-lift behind it. I guess new one will be ready in 2 to 3 years. Usually life-cycle of this level model is 6 to 7 years. But info I’ve read from Lexus employees from various forums (might just be rumors), that when Akio Toyoda took charge of the company in 2009 he dumped the ongoing plans for new gen LS and set a totally new goals for the new generation car. That is why Lexus made a major face-lift in 2012 (for a 6 year old model)and didn’t introduce a new model. I think that Akio Toyoda knows that Lexus needs a true out-of-this-world halo car with the new LS, if the brand seriously wants to compete with Germans in USA and globally. I think it is impossible to repeat 1989, but they will try to achieve something as similar as possible. Toyota has the R&D funds to do it.

    • 0 avatar
      sportyaccordy

      Lexus will never compete with the Germans globally. Europeans hate Lexus and value history and heritage that Lexus will never have.

      Lexus is doing fine as is with essentially no halo car. For example Jag has a “legitimate” halo car… hell, maybe 2 with the XJ and F type… and their whole brand gets outsold by any Lexus model that isn’t an LS or CT. The whole brand. If Jag could have Lexus’ volume they would toss the XJ in a heartbeat… and the XJ is, if nothing else, the most beautiful car in its segment IMO.

      Nah… Lexus should keep doing what its doing and focusing on segments that matter. BMW & MB have the global F-segment locked down… it’s pretty much pointless for anyone to try and penetrate or compete. Many have tried and pretty much all have failed. There is money to be made elsewhere.

    • 0 avatar
      bd2

      Actually, the majority of ES buyers would not look to the GS since the GS is at a diff. price-point (not to mention the ES is a soft-riding FWD sedan and the GS a RWD sports sedan) and Lexus has stated that there is little cross-shopping btwn the ES and GS.

      And no, the reason for the delay in an all new LS is that Toyota is trying to squeeze every penny from the current gen platform.

      There’s a reason why the GS and LS haven’t seen powertrain upgrades (unlike the Germans); the GS and LS are low volume models where it isn’t worth it to Toyota financially to update them quicker.

  • avatar
    mhickman73

    To me the RX is the most overrated vehicle in the auto industry. They’re extremely quiet and comfortable. The virtues end there.

    The driving experience is perfect if you hate to drive. It’s Novocain for the road. Their sales numbers baffle me.

    Can someone enlighten regarding this car’s appeal? Or do all enthusiasts hate it?


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