*Batman*

In January 2009 I bought my mother a brand new 2009 ES350 loaded with Navigation, ventilated seats, premium plus (everything but the glass roof, ML and semi-aniline) for $37,100. A BMW 328i with a smaller engine but the same options would be $43,500 (if you get it for $500 over invoice) and this is a smaller car with less power. A 335i would be $10k more.

So I do think the ES is a bargain, and if you do the math so is the RX.

LexFather

Yeah. While Lexus has expanded their lineup well the Germans have done so even more. Look at how Audi is tackling the higher segment with not just a new A8 but the A7 as well. BMW now has more SUVs than Lexus, X1, X3, X5, X6 with more coming. Lexus releases and IS-C but Benz releases a real C-class coupe coupe and offers the E-class coupe based on the C-class and a SLK, SL, CL. Yeah they sell in small portions here but they are offered.

It was concerning that they noted they have brought issues that have not been addressed with action. Again I think the document is a great read but sadly Jaeplonik had a guy write a rant to rile up the anti-Lexus people who probably won't even read the document (since most can't read) but instead rely on the "BUICK" headline, post a pic of the face of the GSh and just bash away.

I didn't take the Q5 fighter to heart they asked for. What I saw was between the lines they are saying "hey this Audi threat is growing and its real". Lexus mainly had BMW/Benz to worry about from Germany. Now Audi is making serious gains.

We all saw where this was coming a couple of years ago. Lexus debuted the ES/IS/GS/LS on top one another and now they have no new sedans. It seems from the article dealers told them before the STAGGER the releases to keep people coming in. From my understanding this is FINALLY being done as the original plan was again to debut the IS/ES/GS/LS all together again. Thus the GS will debut first, the ES will be delayed and the IS and LS are being delayed, to stagger the offerings.


I think in some cases the value is there. I just think again the article did Lexus a disservice acting like Lexus sells a bunch of 20k cars. Looking at avg transaction prices most brands are around the same area with Acura way in the back (I think Benz is the highest) Most RX's are easily in the 40k range and many are in the 50k range with options. Here an option package is 8 grand with the 450h, which is a 44k car. So not sure how the author is trying to imply these are cheap cars. Its amazing to me Lexus gets bashed for selling these cars and not one article has stated 'wait a minute, Infinit sells over 60% of their cars from the G25/37 which has an over 10% fleet rate and offers lease deals no one can touch". I guess that is not news, they are unimportant. Lexus? Oh snap, time to write an article!


Dealers are in a tough spot. We all know a lot of the competition leases cheaply like crazy and offers crazy incentives. Lexus hasn't relied on them nearly as much while selling the best here for 11 years. Thus the profits have been HUGE for Toyota. While Lexus only sells maybe 400-500k worldwide compared to Toyota's millions of cars sold, it is said Lexus provides HALF of the profit. There is a part in the document where dealers say they are very happy with the price of the CT which offered value compared to some offerings today. They want to see more value added. That said it seems apparent that maybe they haven't a clue how damn bad the YEN is trading. Margins are being squeezed just on the dollar/yen ratio. Its much harder for Lexus to offer a "value" today with the yen at 83 compared to 116.

Its funny when Lexus was kicking *** and taking names there wasn't much said or written about it. 11 years at number one is UNHEARD OF and instead of articles about the success, we are hearing every day about how Lexus is going to die, the end is near, Lexus sucks b/c the run is over.

*Batman*

They got their credits in the 1990s when people wrote articles about Lexus coming out of nowhere and booting Mercedes and BMW out the door. When the LS was the sedan to own, and when boys pinned posters of SC400s to their walls.

Remember they were only Number 1 in the US. For the past few years, they have been the global number 4.

I would be inclined to bet against Lexus for the following reasons:

1) It is difficult to lead in luxury without a bigger R&D budget. Lexus is scale disadvantaged and can't match the others R&D budgets. Lexus doesn't have things like the BMW technology center in Palo Alto which provides close collaboration with Apple and others. Luxury for old people is about wood and leather, but for young people it is increasingly about new technology and features. They don't even need to be gadgets - things like Mercedes Magic Ride feature which varies suspension based on scanning the upcoming road surface is an example of improving luxury with tech. When you look at BMW, Audi and Mercedes, the evolution of new luxury features and technology is rapid - they introduce new stuff every 6 months. Lexus introduces new stuff every 3 years. This is not just a process issue, it may well be a budget issue. Jaguar has the same problem.

2) Lexus seems to compete with Toyota for resources. If you look at the last 3 years its easy to assume that Lexus hasn't done anything. They launched the new GX (but that's mostly R&D for the Toyota Fourrunner), the LX (landcruiser) and the CT (a genuine Lexus car but borrowing heavily from Toyota parts bin). Lexus hasn't has a new powertrain of its own since 2006 (bar the LFA). In this time period BMW and Mercedes have introduced multiple new engines. It appears to me as if Lexus and Toyota share resources, and that for periods of time (longer than a year) Lexus may recieve very little attention. In the meantime the engineers at BMW and Mercedes are working relentlessly on powertrains, new chassis, and new tech.

3) Lack of Agility. Lexus has seemed to lack agility for a long time. The commentary around Toyota's F1 program indicated the same thing - they are good at long and thorough projects, but not good at quick iterative development cycles. This was why they couldn't compete with McLaren and Ferrari who could find several seconds a lap during the mid-season through agile development.

4) Lack of inspiration. The LF-Gh is meant to be their vision. All I see is a slab slided car with a distinctive grille that they are discarding. It seems the CT is the best indication of their vision. If the CT was a woman, it would be a frumpy plain jane with great smarts but no sex appeal.

Of course they could always try to win on price like they did in the past, but I suspect the game of competing on price will place them in competition of the likes of Cadillac and Hyundai, and Hyundai will win the price game.

dunnojack

i finally read through the whole document more carefully, and there are some good points.

yeah, the 4GS is especially crucial, not just about design, but pricing.
ooooooooh, let's see how lexus plays this out.

I love how they say the GS has become irrelevant in the segment. truth.
But here in the US, at least lexus doesn't have to be concerned about the A6.
audi will price themselves out of the market; i don't expect many sales of the new a6.

lexus has a unique problem- as products get stale, sales decline.
but the germans have been able to keep up the momentum, even on their stale products.

gengar

Actually, my point was that there is far too vast a range of desires and complaints in the document. Because of this, many of them are entirely contradictory.

Also, I have a big problem with demands from salesmen when they forget how they got to where they are. I mean, we all know why Toyota and Lexus have been successful. After all, when I was going on my LFA tour at Toyota City in Japan, one of the people I talked to bemoaned how Toyota's head honchos are constantly searching for the next Camry and the next Prius. Boring, bland, uninteresting, not emotional, too practical. But how can you blame the guys at the top for wanting the next Camry and the next Prius when that's what has made Lexus and Toyota?

Lexus and Toyota didn't get where they are by always being the leader and pushing the boundaries of performance and emotion and technological innovation on every front. They got where they are with a conservative game plan focusing on quality, where the company was OK being slightly behind on product refreshes and new generations, which led to being behind on performance numbers, some technological innovations, and as a result lower than the competition on emotion and character. Even when they led innovation, it was well-researched and implemented very well, like hybrid technology. In exchange, we got a reliable product that was functionally well-engineered, desirable to the masses, and in most cases, represented (and still represents) exceptional value. In Lexus' case, they filled a complete void in the luxury segment that the market desired.

Don't get me wrong. I'm not saying that this is the right way to do things, nor am I saying that car enthusiasts should want Toyota/Lexus to do things this way. After all, it should not surprise anyone that given so many Toyota/Lexus executives' search for the next Camry/Prius, that it becomes very difficult internally to OK projects like the IS F, LFA, and FT-86 even when the president of the company is totally on board.

But looking at what it is the dealers are asking for, they want everything. They want to beat all the other lux manufacturers at their game while still managing to improve Lexus' own game, all the while keeping low costs and low prices and still giving dealers incentives! Why? Because all salesmen care about is making more sales and making more money. They'll do anything to do it and they'll say anything to do it, which is why, in my book of rules of life, the #1 rule is "Never trust anything a salesman says." We all agree that Lexus is going to lose the luxury sales crown for a multitude of reasons, and this itself is against what the dealers want. Their demands are so unreasonable that, ultimately, I can't take it seriously and any good points they make are just lost in the contradictory nature of the overall document.

TRDFantasy

Keep thinking that Lexus is a "follower" in terms of technology. Seems like some of the dealers read too many internet forums as well .

I'm not going to rehash all the WORLD FIRSTS that Lexus has come up with over the years in terms of technology. It has been mentioned numerous times on CL before.

This so called leaked document really doesn't talk about anything new. It just points out the obvious.

Obviously dealers are annoyed with an aging lineup, but the lineup will soon be completely revamped. The CT just came out, funny I don't hear dealers complaining about that .

Fact is, you can't have your cake and eat it too. Dealers want higher quality and shorter life cycles? Not possible, especially if dealers want Lexus vehicles to maintain high resale rates. Quality is #1 at Toyota now, which is why Lexus is taking their time with upcoming redesigns.

There are a few issues mentioned that need to be addressed, but the fact is those issues ARE being addressed already at Lexus.

Since you called out Lexus for some of the above issues, it's only fair then that you should call out Benz and BMW for excessively long life cycles as well.

Exactly! Very well said! I agree completely .



Please, for your own sake, I would highly recommend you do some REAL research about Lexus and how separate it is now from Toyota before making further comments.

Just so you know, here are some facts for you:

- Lexus for years has had a separate R&D budget from Toyota.
- Lexus has its own separate development center for Lexus products in Japan
- Lexus has had its own separate design studio for years now

Lexus for over 6 years now has been organizationally separate from Toyota. Do they still share some things with Toyota? Yes, just like some things from Benz are STILL shared with Chrysler, and how BMW shares certain things with several other automakers.

spwolf

well thats the way it works anyway, always keeping the pressure :-).

But at the same time. TMC also puts great requirements for its dealers as well.

spwolf

And Toyota has largest R&D budget in the automotive world :-).

As to the engines, MB only now introduced V6 that can rival 2006 GR engine, and BMW HAD to change their engine design because it was unreliable. Not something I would call exactly an strong point against Lexus.

Vladi

What I strongly agree with is that life cycle must be cut to 6 years with outstanding facelift within 3 years or every 2 years if they don't want to update looks and drivetrain at the same time.

7 or 8 years is way too long for today's way of living and consuption especially with the way Lexus does facelifts which can only be seen by enthusiasts. People expect new stuff all the time and this world is moving quickly and it will only get faster not slower.

Also they have to time their products so they dont have the situation where GS, IS, LS are realeased almost at the same time (2 year period to be exact) which will always get them in position they are right now with aging cars. They are right about the strategy of BMW; 7 first then 5 then 3 spread out through the lifecycle of 6 years.

Lexmex

Lexus/Toyota needs to look down to the individual buyer. I can't begin to tell you how many times Lexus models lost out when my friends got down to 2 or 3 models they were settling on, often to an Acura or Infiniti, but BMW and Audi also figured in, too.

Price and the value one got for their $$$ was the biggest thing. One of my friends had gotten down to an IS and a G series Infiniti and wound up with the Infiniti going line item by line item as to what they got in terms of value.

I am sorry Lexus but just saying to yourself that reliability will win out customers in the end no longer figures in here. You have an entirely different generation of buyer that's got a different set of priorities from what you may want or think they have.

GS69

Polk did an analysis last year that showed luxury brand's sales were skewed towards the entry level vehicles - only Mercedes seemed to be more diversified. So Lexus really is no different or worse off than the norm:

*Batman*

Precisely.

MPLexus301

iTrader: (3)

Batman, I agree with the comments from spwolf and TRDFantasy, and your thoughts about a lack of responsiveness to the rapidly changing market but disagree on the notion of not having any new engines since 2006. In the last 5 yeas, Lexus has delivered the world's first hybrid sport sedan (GS 450h), an all new corporate V8 (LS 460), world's first hybrid V8 (LS 600hL), an incredible high performance V8 (ISF), a 30MPG hybrid V6 (RX 450h) and one of the most advanced, high performance exotic engines in recent memory (LFA) which you did acknowledge.

That is a good bit of R&D right there, especially for the LFA. People bish and say that Lexus is behind on R&D and performance technology, and then so conveniently forget that they just finished an incredible super car that BMW, Mercedes, and Audi can't touch. Most of the tech in the R8 comes from elsewhere in the Audi parts bin and the top end engine was sourced from Lamborghini. Lexus built the LFA themselves, from scratch... nearly every component is unique to the car and you can't say that for the SLS or R8.

*Batman*

The ISF and LS600h engines are within the last 5 years, but
GS450h was launched in 2006 as a 2007 model (RX450h uses same plant)
LS460 was launched in 2006 as a 2007 model

To be fair to Lexus though, the V8 in the LS has been fairly competitive, its the GS V8 which was detuned and non competitive. If the V8 hadn't been detuned for the GS then I would say they would be good, and due for an update soon.

The bigger concern is not so much the lack of new engines in the last 5 years, as much as that nobody has heard an iota about plans for new engines any time soon.

MPLexus301

iTrader: (3)

If we're going to be that techincal, 2011 - 2006 = 5 years....no?