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High End Luxury Cars

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  • pablo_lpablo_l Posts: 491
    I would not take those Carpoint statistics as facts. Interesting, but in such things one always has to wonder how statistically significant the group in question is. And when the differences are in the 10% range, my assumptions is that there's hardly any relevant differences all in all.

    Someone asked about finance vs cash - I think here in Silicon Valley I am the last of the dying breed of people who buy cars cash. I only know *one* other friend who did - he got a BMW 330Ci, even though he could easily wing a new Bentley Continental. Moderation seems to be "in" for cash buyers these days. :-)

    Since we are trying to categorize, me and my friends are very much into watches, and one is a very successful Jaguar sales associate, whi has the following theory: for te most part, Lexus owners don't give a hoot about good watches, MB owners are brand conscious but have a high percentage of quartz owners, and Jag owners tend to be mechanical watch people. True watch afficionados tend to also be collectible car fans. Just advanced the theory for what it's worth and as an entertaining side note. Note: I do collect mechanical watches. Buying a good watch every 1-2 years is one of my old traditions. :-)
  • boo20boo20 Posts: 85
    I think that the demographic differences between MB and Lexus buyers are substantial. I also beleive that Lexus styling is deliberately conservative because they are essentially going after the Cadillac crowd. This does not bode well for the future of Lexus. Seeing these 80 year old guys puffing on cigars driving their Lexus--how many more years have they got? Will they still be driving in a few years to purchase another one? Cadillac was worried enough about the demographics of their buyers to do something about it. Will Lexus follow suit before it's too late?

    With few exceptions, and contrary to what the Lexus enthusiasts seem to think is fair and proper, MB cars are sold out. You can't get an SL, CL class without an 18 month wait or sold used above MSRP. Look at the E class board where the '04s are sold out through March of next year before they have even hit dealer showrooms. The S class will not sell as briskly but still does well considering that it is in its last year of this production cycle with a new model coming out in '05.

    Lexus should be so fortunate as to have these "problems."
  • merc1merc1 Posts: 6,081
    Oh, ok I didn't think I said THAT about the LS430...lol. I generally despise SUV/Trucks so I don't have much of an opinion on them. I personally wouldn't even mention the ES, as it's one of the most "what the hell" cars on the road, imo. We'll have to see what the next GS actually looks like.

    Now with these surveys. There is a reason why European car owners/fans don't see them as the bible. Right here on Edmunds I can read about Acura TLs having one transmission problem after another. Also on here I can find more than a few people complaining about the ES300's transmission. What I really want somone to answer is how BMW managed to place 5th(?) in one these surveys, when the 7-Series by all accounts was the most bug ridden car of the year. None of this is reflected in these precious surveys. Why is that? But yet I can read on how Mercedes' have brake dust problems, how Minis have a bad ride and how a Hummer has bad gas mileage. My point is that these surveys are not conclusive to a point to assume that Mercedes' are breaking down at the side of the road. There is a lot of detail missing, especially with JDP data. There is no way I'm going to blindly accept these as gospel ever, because they simply don't tell the whole story. Yes, a Lexus is more reliable than a BMW or Mercedes, but how much so is the questionable part.

    sv7887

    You're still missing the point about the handling of these two cars. Nobody is trying to make it seem like what you're saying when comparing a 747 to a F-22. Where has anyone said that the difference is that drastic? I don't know how else to explain to you. If you can find me one road test comparison of luxury sedans in a U.S. magazine that actually said one car was better than another simply because it could take a curve at a 100 mph better than the next car, I'll eat that issue. That simply is an exagerration of whats been said here.

    Demographics. Ok so the average LS430 leaves out the door for 58K or even 68K, thats still about a 15K difference between it and a S500, there is no way everyone going for the Lexus can afford the S500. My point is here is that there is a different demographic for the S and LS, they aren't nearly the same, the only place where they would be is in the case of the S430.

    pathdoc,

    They actually knocked the S430 for it's predicted reliability, of which they don't know squat about yet due to the car being facelifted for 03', and for it's cupholders. How ridiculous.

    Can any Lexus fan tell me why I'm reading in here that an Acura is a "upscale Honda" and a Lexus isn't an upscale Toyota?

    M
  • ljflxljflx Posts: 4,665
    There were about 35 SL's here in NJ listed for sale at ray catena each of the past two sundays. I don't know of any business that advertises anything that has already been sold. These waits are always badly overstated and disappear long beforehand.

    I saw that demo on Lexus in microsoft car point and found out that it is from a census they take. I've bought Lexus vehicles since 95 and now that I think about it I've never been asked nor have i ever provided them my age. They did ask for a bracket of what age group I'm in though - if that counts.

    I looked at some of the reviews at carpoint and the inconsistency is something. They say the 7 loses value quickly and the S and LS don't but then they rate the 7 as a higher percentage (70-60 if I remember right in the scoring to the other two). They praise the LS' interior quiet and jump on MB a bit for not being as quiet then score them the same way. I don't think there is any bias there (the scoring was unfair to all three cars in different instances), just a general inconsistency (the two I gave are just references - there are plenty more amongst the three cars) and when i see that I don't take the data seriously as no one is checking what is printed. I mean if I catch such mistakes with a 5 minute (if that) review than its obvious no one is edit checking them for a living.

    So let's see - now we are up to 80 yrears old. Within a day or two we should crack the century mark. Your predjudice against Lexus is beyond reproach and I will no longer respond to it.
  • merc1merc1 Posts: 6,081
    This must be an awfully large dealer to have 35 new SLs in stock. Thats just about unbelievable or incorrect "data" that nobody at the dealership has updated.

    M
  • boo20boo20 Posts: 85
    These are used SLs. No dealer has 35 NEW SLs in stock. Most have none. The ones that have 2003s in stock have been sold and bought back by the dealer and sold at, or above MSRP. Look at Ray Catena's website: http://www.catena.mercedescenter.com/mbcenter/b/index.jhtml. You can do a search and come up with five 2003 SLs. One has 15,000 miles and is still selling for (approx) MSRP. I know that this is a concept that is hard for non-MB enthusiasts to comprehend but let me explain to you how it works: Dealers sell these cars based upon a priority list (generally you have to get on it about 18 months in advance). They are driven a few thousand miles and then sold back to the dealer at or near MSRP. The dealer is then no longer constrained by MBUSA as to what they can charge for these cars and they go to the highest bidder. MB does not allow dealers to sell NEW cars above MSRP but they have no control over the used car market.

    The rare NEW SL you will see at dealers is typically an SL55 which goes for 130 big ones. The market for these cars is small, almost as small as Ferrari.

    The marketplace has basically spoken. I have never seen used Lexus vehicles go for MSRP. I have never heard of an 18 month waiting list for a Lexus.

    On another point my comment about 80 year olds drving Lexi was clearly hyperbole and intended as a joke. Clearly, however, the demographics of a Lexus buyer is different than an MB: he's older and less affluent. There's nothing wrong with that but it helps to explain Lexus' marketing strategy. I think Lexus' main competitor is Cadillac and not Mercedes. <JOKE>Who else would want to drive a car that looks like a coffin (and when your time comes you don't even have to get out of the car! ;) )</JOKE>

    Incidentally, studies have shown that people spend about 4 months gross salary on a new car. With this perspective Carpoints stats are right on target (which makes me believe their demographic data is accurate): So for an average yearly income of 186 K Lexus buyers purchase a 60 K car (4 months income). At an average income of 286 K MB (S 500) buyers pay about 90 K (again 4 months income).
  • sysweisyswei Posts: 1,804
    I caught the tail end of a commercial about MB's lane change warning system (sounding a warning tone if the driver drifts out of lane)...is this something new for 2004 or is it more a statement of direction? Anyway, a welcome innovation that I hope Lexus "copies" heh, heh.

    I think it would be nice if someone made a blind-spot checking system to warn of potential collisions when a driver intentionally changes lanes.
  • sysweisyswei Posts: 1,804
    Merc1, you mention tranmission problems of the TL and ES, and ask say "none of this is reflected in these precious surveys". I think you're wrong there. Acura and Lexus are not reported by JDP to have zero or anywhere near zero defects per 100 cars (and if they were reported as such it would make the survey suspect indeed). They do have lower defects per 100 than many other manufacturers, including MB. The detail data are available to the auto manufacturers...for a big price tag. The reason you do hear of some detail data (like the Hummer stuff) is that when the press reports on JDP, they will mention a few items that contributed to the poor ratings for manufacturers that didn't fare so well in the surveys. They don't happen to mention the items that the more reliable brands had problems with. It doesn't mean, as you can tell from the aggregate problems per 100 data, that Lexus or Acura have zero problems. Nor does it mean that the surveys fail to catch the problems that show up in Lexus or Acura cars.

    As for the 7 placing fifth in a survey, I didn't happen to see this. But it may have been a JDP survey that doesn't measure quality. There is one such, I can't remember what it's called.
  • sysweisyswei Posts: 1,804
    I guess I fail to see the importance of the average income level of LS and S buyers. To me it is perfectly logical that a car that has a lower average price point is going to have a lower buyer's average income.

    Does that, in itself, show that it is a worse car or something?

    SL buyers probably have lower average incomes than Ferrari buyers, does that mean that the SL is a worse car for the money?
  • sysweisyswei Posts: 1,804
    One more thing about JDP. To my knowledge no car company has ever sued JDP over faulty methodology. Unlike CR, which I think got sued by Isuzu (Trooper rollover test) and maybe others that I don't recall (Audi?).
  • sysweisyswei Posts: 1,804
    from JDP:

    "While Japanese-branded vehicles continue to dominate in terms of long-term vehicle quality, the Europeans have lost their edge over the U.S. domestic-branded vehicles...

    The 2003 study, which measures problems reported by original owners of 2000 model-year vehicles at three years of ownership, finds that although there is near parity between U.S. Domestics and Europeans in terms of initial quality, substantial quality gaps appear between the Domestics and the Europeans in long-term durability. On average, models by domestic automakers outperform the Europeans by 49 problems per 100 (PP100) vehicles at three years of ownership.

    "Conventional wisdom said that dependability was the property of the Japanese and Europeans," said Joe Ivers, partner and executive director of quality/customer satisfaction at J.D. Power and Associates. "While that&#146;s still true for automakers like Toyota and Honda, it&#146;s no longer the case for many of the Europeans. Porsche, Jaguar, Saab and BMW perform well above the industry average in dependability, but many other European brands are bought based on a reputation for long-term quality and fall far short of even the average. This is in stark contrast to the results of the first VDS, conducted in 1990, when Mercedes-Benz led the industry.""

    To see the full press release, go to http://www.jdpower.com/cc/auto/releases/index.asp?catid=1 and click on Acura, and then click on the blue icon in the upper right of the grid (i.e., 2003 Vehicle Dependability Study / Press Release).

    Personally I had no idea that MB fared so well back in 1990 (they are well below average now). If they can get back to number 1 status, I'll certainly consider them very seriously for my next purchase.
  • habitat1habitat1 Posts: 4,282
    The last car I would buy as a sedan replacement is an S-class, LS or 7-series. My space needs and driving preferences would have me spend $75k on an M5 (or even E55) before any of the above.

    That said, the demographic generalizations being made above suggesting an older, less afluent Lexus buyer don't hold true within my circles. Examples: A 45 year old business school classmate of mine sold his company in March, 2001 and personally cleared $440 million. Drives: LS430. A 65 year old real estate executive with 6,000 apartment portfolio - S430; his 41 year old son, S500. I could go on.

    My former classmate with the LS430 also has a 911 Turbo in the garage which is his "fun to drive" car. His opinion, the LS430 is 90%+ the luxury auto of the S500, with 0% of the maintenance headaches and hassles. He values his time very highly and if he's going to have hassles, it will be over a sports car like the 911 rather than his daily driver luxury sedan. In spite of his success, he has no apparant ego need to flaunt it.

    In my circles, the number of people who buy an LS430 (or Q45) because they can't afford an S500 is less than the number who have drifted away from the Mercedes brand over quality control and reliability issues over the past few years. I'm glad I don't need the size of the S or LS or Q. I'm not sure what I would do.
  • sysweisyswei Posts: 1,804
    Thanks for your anecdotes, and welcome to the board! It is certainly true that some LS buyers made their choice despite the car's value pricing, not because of it. Bill Gates is the most famous example, and as far as I know he still uses an LS as his daily driver.

    An interesting calculation: with his net worth of $46b, if we included EVERY LS and S owner in a demographic analysis, Bill would, all by his lonesome, skew the LS average (mean) net worth upward by $230k! (I am assuming 200k LSs on US roads, which is just a guess based on a 2003 run-rate of 20k or so cars. I am also assuming that he no longer owns an MB...I know he once did, before the LS, but don't know if it was an S or if he sold it.)

    Steve Ballmer's $12b would skew the LS430 mean upward by another $60k. Steve is another LS driver, though it is conceivable that he also owns an S.
  • ljflxljflx Posts: 4,665
    Excellent comments. The oldest LS430 driver I know is 56 years old. When I bring my car in for service most others dropping cars off are in their 40's to early 50's in appearance. In my town which is a wealthy one you see plenty of LS430's and S-class cars and it's probably a 50-50 ratio. It's the 7 and the Jag that you see only upon occassion. There are plenty of LX470's and TLC's at every school and sport event and uncountable ML's and RX's around that you see at every turn. Since I see many of the LS430 and S-class cars at school and student affairs, and since most of them come from homes in the $1-5mln range it's obvious boo20's demographics don't work around here. They are not even remotely close. Anyone can put out a financial tool linking car price to some income threshhold but that hardly means that is who the car is being sold or marketed to. Secondly as syswei states why does it even have any relevance. For what it's worth someone I know well in the $100mln+ wealth range has an LS430, an LX470, 3 old MB's from the late 70's to the late 80's (two of which are SL's) and a VW beetle. He's 55 years old.
  • lenscaplenscap Posts: 854
    "The average yearly income of an LS buyer is 186,000. The average yearly income of an S class buyer is 284,000."

    These stats have little to do with who can afford what car. Income should not be confused with wealth, which are two different things.

    Somebody may have an income of $300,000 but also have two mortgages, car payments, credit card debt, very little in the bank, etc. They may only be able to afford an Accord. They have a big income but would not be considered wealthy.

    On the flip side, somebody may make $100,000 but have no mortgage or any other debt with lots of money saved up. This person could easily buy most any car with cash.

    The true measure of what somebody can afford is their wealth (money saved up), not their income.
  • pablo_lpablo_l Posts: 491
    Well, probably there are no invariable rules on how much money you *should* spend on a car, but I'd wager that there is a real link between yearly income and amount spent on a car, even though there'll be variances. After the bubble, I think there are still people that have significant amounts saved up, but they're dealing with that very conservatively and re-adjusted to live off their salaries, a revolutionary concept for many who were used to spend out of their stock option accounts. :-)

    I think both the Lex and the S (and others discussed here) are the type of car people with high yearly incomes consider, because I think they target primarily business customers - a large sedan seldom is a choice out of passion.

    I know my dad had a rule to never spend more than 4 x your monthly salary on an everyday car, which I think a prudent approach. In Europe, where company cars are perks and you get a mix of tax benefits and liabilities with it, there rules are different.
  • pathdocpathdoc Posts: 126
    Even stodgy Consumer Reports found the S430 to be a better "handler" than the LS430(CR Nov. 03,p58). "handling is not particularly agile,and body lean in corners is pronounced". About the S430(p.59): "The S430 is both refined and enjoyable sporty. It is the most comfortable-riding car we have ever tested,and its agile handling makes it a delight to drive."
    This summarizes my findings when I have tested the LS vs Mersedes S.
  • ljflxljflx Posts: 4,665
    Posts like yours with experience on both sides of the coin are so much better than the ridiculous bashing that goes on here at times. Your feeling about the S-430 vs LS430 mirrors my experience in 2001 when I shopped the S-class. I needed the S-500 to truly compete but still preferred the ride, luxury and phenomenal interior of the LS430 over the S500 which is a truly fine car and not one that should ever be bashed. The fact that you can get the LS430 if you go that route and pocket $18k or $350 a month if you're leasing makes it all the more better. You also sound like me with the 99:1 ratio as I've said the same thing many times. Lastly I never thought the S-class had much road feel or driver feedback which is the biggest mis-representation I've ever read on this board. In fact it and the Lexus were very close in every way. That is the biggest joke of all because if you bash the LS you are also bashing the S-class because they are so close in the essence of what they do and do so well. Now the AMG's may be a different story but that is not a stock car as far as I am concerned.
  • b4zb4z Posts: 3,372
    Interesting story in C&D. Mistsubishi has the lowest age buyer in the industry. 38.
    They are actually going after an OLDER buyer.
    Better credit, higher dollar purchases, etc. etc.
    Food for thought.

    How many of you guys have disclosed to the F&I guy or to a customer questionaire, what you actually make?
    If you are pulling in 500K a year do you tell them? I don't know anybody who would.
    I'd tell them enough to get the loan.

    And if you paycash, then how do they know?

    The demographics are seriously skewed downward on ANY luxury product.
  • boo20boo20 Posts: 85
    There is no logical relationship between what is the most common trade-in and what cars compete in the same market segment. My point was that Lexus appears to appeal to the same conservative geriatric crowd (thus explaining its uninspired styling) that Cadillac aspires to. Lexus has substantial brand loyalty and that's why most of the trade-ins are from previous Lexus owners. It seems to me that the people who are attracted to Cadillac would also be attracted to the Lexus.

    As far as selling new cars it may be true that MBUSA cannot legally compel its dealer network to sell them at or below MSRP they CAN exert considerable "influence" on them by regulating the allocation to each dealership. If this were not the case how can you otherwise explain the shenanigans going on with the SLs where they are sold back to the dealer with 15,000 miles and resold at MSRP? This is a common ccurence with MBs and rare or nonexistent with Lexus. 18 month waiting lists are also unheard of in Lexus country. Buyers selling their waiting list position for cash to more eager buyers is also common with the more popular MB models and would be laughed at by Lexus where you can go into any dealership and buy these cars right off of the lot. There's a reason that MBs are much more desirable than Lexi. Some of us have figured this out already.

    I am still waiting for an answer to the question I posed previously: what would happen to LS430 sales if they raised the price of their vehicles to the level of the S class? Would they sell more or fewer vehicles? My guess is that their sales would plummet. Why would that be if the LS430 is as good or better than the S? Because 1) it isn't and 2) given their demographics this would price many current Lexus buyers out of the market.
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