Lexus Topped Premium Brands In The U.S. In July, And How

Timothy Cain
by Timothy Cain

In 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.

The 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.

Timothy Cain
Timothy Cain

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  • Brock_Landers Brock_Landers on Aug 27, 2014

    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.

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    • Bd2 Bd2 on Aug 27, 2014

      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.

  • Mhickman73 Mhickman73 on Aug 27, 2014

    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?

  • Kwik_Shift_Pro4X As much problems as I had with my '96 Chevy Impala SS.....I would love to try one again. I've seen a Dark Cherry Metallic one today and it looked great.
  • Susan O’Neil There is a good reason to keep the Chevrolet Malibu and other 4 door family sedans! You can transport your parents and other somewhat handicapped people comfortably and safety! If someone can stand and pivot you can put them in your car. An armrest in the back seat is appreciated and a handle above the door! Oh…and leather seats so your passenger can slide across the seat! 😊Plus, you can place a full sized wheelchair or walker in the trunk! The car sits a little lower…so it’s doable! I currently have a Ford Fusion and we have a Honda Accord. Our previous cars were Mercury Sables-excellent for transporting handicapped people and equipment! As the population ages-sedans are a very practical choice! POV from a retired handicapped advocate and daughter! 😊
  • Freddie Remember those ads that say "Call your doctor if you still have...after four hours"?You don't need to call your doctor, just get behind the wheel of a CUV. In fact, just look at one.I'm a car guy with finite resources; I can't afford a practical car during the week plus a fun car on the weekend. My solution is my Honda Civic Si 4 door sedan. Maybe yours is a Dodge Charger (a lot of new Chargers are still on dealer lots).
  • Daniel J Interesting in that we have several weeks where the temperature stays below 45 but all weather tires can't be found in a shop anywhere. I guess all seasons are "good enough".
  • Steve Biro For all the talk about sedans vs CUVs and SUVs, I simply can’t bring myself to buy any modern vehicle. And I know it’s only going to get worse.