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High End Luxury Cars

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  • merc1merc1 Posts: 6,081
    That sounds like poor dealer service to me plain and simple. I can't imagine a service telling a customer that MB corporate is putting them under the gun on something like that or any other type of warranty repair, that is ridiculous. He should have found another dealer and/or contacted MB corporate. A service rep saying something like that should have been brought to the attention of the higher-ups at the dealership too.

    M
  • blckislandguyblckislandguy Posts: 1,150
    Merc1, please consider this (and I am not a Lexus fan). MB dealers are nowhere near as profitable as Lexus dealers for many reasons to include dealer proliferation and falling residuals. They have a gross profit margin of 5 or 6% (I will be happy to stand corrected, but I doubt it is 7%) on a new car. As a result there isn't a lot of money on a new sale. "Oh, but the dealer gets to grab the trade in for little money", someone interjects. The used car operation which normally is quite profitable for all dealers may not be so much so anymore for an MB dealer if the three year old MBs are not holding value.

    Now the local MB dealer is not yet living in a double wide but his world has changed. So, it is quite believable that an MB dealer is not going to do a lot of things a profitable, high class dealer should do.

    PS Maybe Al Queda has Juergan's up armoured S Class?
  • ljflxljflx Posts: 4,687
    Ah the business side that Merc hates. Now just watch the major cost cuts and model cutbacks that are put into effect in the next 12 months. Big time changes are coming to Mercedes as everyone knows his strategy to please everyone (with Smart to the Maybach and model variants so numerous that most people don't even know they exist) has been a disaster financially but sat well with the purists. Autorags loved the widespread models, purists like Merc love to talk about it as a strength but the plethora of products was/is unmanagable and the financial markets (run by people who know business) cut the company's market value by 65% since 1999. Just watch as a much more conservative business plan is put in place, the company is redirected and probably prices are lowered at some point in the next 24 months. And remember it's MB that is the problem not Chrysler. It was interesting to hear CNBC cover the story and use the statement "Mercedes isn't the Mercedes of anything anymore".

    By the way the stock rise of 10% comes on a bad earnings report. Cut through all the headlines and news and you see a 20% drop in operating income from a year ago.

    http://biz.yahoo.com/ap/050728/germany_daimlerchrysler_schrempp.html?.v=13
  • ctsangctsang Posts: 237
    merc1, knows like you don't know that Toyota pioneered and benchmarks quality control and just in time manufactoring.
  • merc1merc1 Posts: 6,081
    MB dealers margins changed years ago, but I would agree that they aren't close to Lexus dealers when it comes to profitability because of that and the fact that they sell less vehicles through more dealers. Maybe the dealer in question was a smaller dealer, I don't know..and we surely don't have all the facts...too much assumption there for me to take that seriously. If things are that thin for a dealership they need to re-think staying in business.

    M
  • merc1merc1 Posts: 6,081
    I don't "hate" the business side at all. What gets me is this business side stuff being brought up (as an excuse) for any and everything when the discussion is about the physical "car" not the company. We can't talk styling, engines, suspension, safety or anything else without reading about what Toyota made last quarter, it’s the ultimate crutch/excuse for Lexus apologists eager to gloss over Lexus' faults.

    We can talk about the business side too, I have no problem with that, but gee whiz when we're talking about handling what in the world does Toyota's earnings have to do with it? Nothing. That and the ridiculous notion that buyers walk into a showroom with Toyota's earnings on the brain is what I take issue with and consider being bunk.

    M
  • ljflxljflx Posts: 4,687
    The business side has a lot to do with building a performance car. If the business plan didn't include building performance cars than they don't get built - unless some emergency decision is made. There's hardly an emergency here. Remember the Japanese are as patient as the Germans are stubborn. It takes a lot to move either one off the base position they've taken. In that regard they have a lot in common.

    As for Juergen I thought he had some good strategic visions on being a global player but he botched the execution badly. I still think buying Chrysler (where would they be without it now) was smart but they executed badly for years before they got it going. MB has become far too spread and lost sight of its core business plan and Mitsu was a disaster. They've addressed the first and last points and the big focus will be on MB going forward. The strong positive reaction was all centered around Zetsche (who seems to be a genuinely nice guy with an ordinary ego) reigning MB back in. It was probably emotionally overdone but this guy has done some great things. Freightliner seems to be doing very well now after its spate of troubles a few years back. But a drop of 20% at the Op income line shows that there are a lot of problems to be corrected.

    OK - enough business out of me..
  • bwiabwia Boston Posts: 1,234
    Notice that the biggest supporter of Schrempp, Deutsche Bank, sold a sizable chunk of its DCX shares and made a tidy profit in the process.

    The next step is for MB to divest itself of Chrysler and concentrate on the luxury end of the car business. Schrempp devalued the brand in the ten years that he was CEO and I hope his separation compensation is devalued accordingly. According to an AP story “although his contract runs until 2008, Schrempp will only draw his salary until the end of this year, a spokesman said.”
  • You had to know there was trouble when they kept extending that June promotion.

    Eventually your sins catch up...all these years of a less then reliable product is catching up fast on MB...

    I will never understand why they couldn't steal a few big time Japanese electronic wiz kids to solve their problems...Truth is their mechanical engineering is probably as good as it has ever been, it is all that electronic gear that is killing them.
  • lexusguylexusguy Posts: 6,419
    They arent screwed together like they used to be though. Try a current S vs. an S420 and you can see the difference easily.
  • merc1merc1 Posts: 6,081
    They arent screwed together like they used to be though. Try a current S vs. an S420 and you can see the difference easily.

    Thats true in that example if you're talking about the 1992-1999 W140 S-Class. I haven't seen anything built like that car or the SL from that timeframe, only the VW Phaeton comes close in sheer robustness, and it pays the price in weight.

    However newer Mercedes like the SLK, CLS are built as good as anything on the market, and there is nothing shoddy about the CLK either. Only the E-Class could use an upgrade. The C-Class is much better than that awful 2001-2004 interior. The upcoming S-Class appears to be the biggest return to form yet as far as build quality is concerned, the detailing is awesome.

    M
  • greenbeltgreenbelt Posts: 55
    You said:

    "Everyone knows that on the industry side Toyota's profits are the big story, but what does that have to do with the type of cars they build when it comes to styling, design, performance or their sheer desirability? Nothing."

    I say:

    The story is that it has EVERYTHING to do with the type of the cars they build when it comes to styling, design, performance or sheer desirability, for the simple reason that their financial results are the only objective measure of their success in meeting customers desires. In the automobile business, customer desires are satiated by the product's styling, design, performance and sheer desirability rendered in a high quality and reliability vehicle in every market segment and price point a company addresses supported by the perceptions created through marketing.

    You might have an opinion about MB and in fact, MB vehicles might best address your desires, and be #1 in your list and that's fine, of course. But there's no doubt at this point in time, that Toyota is the leading car company in the world.

    We all recognize that MB and most other Euro makers need do a LOT of work to get their quality and reliability standards up to Asian and U.S. benchmarks. I think that if Toyota finds that it would be profitable to invest more money in a better, broader luxury, sporty product line, or build a bunch of cars on different platforms to satisfy a niche market, they will. And they'll do it right. Do I think that MB will fix its reliability and quality problems. I don't know, but the survival of the brand hinges on it in the long run because the real dent Lexus and Infiniti have put in the market is that a 'luxury' car that's unreliabile and low quality, really isn't a luxury car, after all.
  • merc1merc1 Posts: 6,081
    Well I disagree completely because there is no way that what company earns dictate the design of their cars, it may dictate how well its built or how the specification comes out, but the design/styling and the way it handles/drives and the other nuances of a brand aren't determined by this in the least. When it comes to design, dynamics, styling etc. it comes down to what a company thinks a car should be for a particular segment, not how much money they earned last year. Some of the must hurting car companies in the world produce the most desirable cars on the planet and some of the most successful companies like Toyota/Lexus produce more snore boxes than anyone else. According your view Toyota/Lexus should make the most exciting and desirable products on earth with all the financial success they have, but it is just the opposite when I look in their showrooms.

    If profits determined what a car is going to be like then Infinitis would be no different in character from Lexuses. It is a maker's philosophy that determines the fine points, not the earnings. Sure earnings translate directly into product development, but they are the sole factor nor do they determine what a car looks and drives like, the issue with Toyota/Lexus products.

    But there's no doubt at this point in time, that Toyota is the leading car company in the world.

    In some things yes, but they aren't even worth mentioning in design, styling, performance or desirability, at least not to the enthusiast. Sure the folks who walk around with a copy of Consumer Reports in their back pockets get a kick out of Toyota, but they imo simply aren't car people, they're consumers and are generally clueless about anything else concerning a car past reliability ratings.

    The "truth of the story" is that if Toyota/Lexus weren't of such high quality they'd be nothing special because they are nothing to drive or look at and they sure don't have any performance advantages.

    M
  • designmandesignman Posts: 2,129
    “The story is that it [profit] has EVERYTHING to do with the type of the cars they build when it comes to styling, design, performance or sheer desirability, for the simple reason that their financial results are the only objective measure of their success in meeting customers desires.”

    If this is true, why don’t they supply annual/quarterly financial reports in the showrooms? Why don’t the sales people integrate financials into their sell? Why doesn’t Toyota/Lexus flaunt their financial success in their car ads?

    Answer: it’s about product benefits; the Toyota product benefit is a reliable car for less; the Lexus product benefit is a reliable luxury car for less.

    Toyota did not start at the top of the financial mountain; they didn’t build an empire based on financial success if there was none to begin with. They had a philosophy as Merc mentioned, and through hard work and sound thinking this vision was manifest in the products. They EVENTUALLY achieved success by way of their products.

    As Merc once alluded to also, unless a company shows signs of being a Daewoo or something, people generally don’t give a hoot about financials.

    It’s all about the PRODUCT, period. And if someone buys a car based on financials, man, are they shortchanging themselves. I don’t crave chocolate ice cream because Ben and Jerry’s is successful.
  • oacoac Posts: 1,594
    But there's no doubt at this point in time, that Toyota is the leading car company in the world.

    In some things yes, but they aren't even worth mentioning in design, styling, performance or desirability, at least not to the enthusiast...


    The key statement appears at the last part of the above quote "...at least not to the enthusiast" I know we've been through this before, but enthusiasts are few and far between, and no truly global player wants to simply cater to such a finite market, unless they are niche players themselves (Ferrari, Lambo, etc). Enthusiasts do not salivate at the thought of driving a base MB or BMW or Audi or Lexus. But at the thought of driving a Porsche, Ferrari, WRX/Evo/M/AMG/RS absolutely YES !!! These cars are the real enthusiast cars... Lexus is not for enthusiasts, so if you walk into a Lexus showroom looking for an enthusiast-biased car, you are in the wrong place.

    So if Lexus wants to be like BMW, its not to create enthusiast-biased cars, but to create a lineup that will be continously refreshed, handle and drive pretty good, lavishly lathered up, have class-leading safety features, class-leading power ratings, and be far more reliable to boot. And Lexus is going about this methodically, as usual:

    IS350: class-leading 306HP for a naturally-aspirated V6
    IS500: class-leading 400+HP for a naturally-aspirated V8
    LS600H: only luxury f/s sedan with a gas-hybrid V8 motor, pumping out 450+HPA

    And more to come....
  • designmandesignman Posts: 2,129
    "Lexus is not for enthusiasts, so if you walk into a Lexus showroom looking for an enthusiast-biased car, you are in the wrong place."

    Oac... I hope you realize you just pitched Merc a hangin' curve.

    ;-)
  • oacoac Posts: 1,594
    I know... but he ain't got the swing to hit it out the park (yet) :)
  • merc1merc1 Posts: 6,081
    The key statement appears at the last part of the above quote "...at least not to the enthusiast" I know we've been through this before, but enthusiasts are few and far between, and no truly global player wants to simply cater to such a finite market, unless they are niche players themselves (Ferrari, Lambo, etc).

    The problem is that Lexus doesn't cater to them at all. They're as good as dead in that market. MB, BMW, and Audi do cater to the enthusiast on some levels, which is what you seem to want to ignore. Not everyone drives a "base" model from these brands, and enthusiasts don't salivate over anything from Lexus. Nothing, Zilch. Will that change with the IS? We'll see.

    Lexus is not for enthusiasts, so if you walk into a Lexus showroom looking for an enthusiast-biased car, you are in the wrong place.

    Finally something I agree with completely. So now is the time to quit trying to compare them to the Germans at every turn, but they aren't playing the same game at every level. To be "lavishly lathered up" sounds like a Cadillac from days gone by.

    The IS350 has class leading hp but no manual transmission. This is the biggest boast about nothing Lexus could possibly make. Every other sports sedan in the IS350's market segment (except one) offers a manual tranny on their best engined models, except smarty Lexus. To suggest that class leading power ratings without a manual in the entry-level sports sedan class is some type of superior arrangement is severe lack of understanding of that class.

    There is no IS500 or LS600h that anyone can buy today so that is just pure fantasy at this point and not worth mentioning like it already has some type of superiority or something. Clearly Lexus isnt' that desperate for props in the enthusiast market as to claim class leading hp numbers for a car that doesn't exist yet + not knowing what the compeition will have at that time. That is more than reaching...

    M
  • oacoac Posts: 1,594
    So now is the time to quit trying to compare them to the Germans at every turn, but they aren't playing the same game at every level...

    Don't ask me not to compare Lexus to the German brands. Ask MB, BMW and Audi if they compare themselves to Lexus.... Ah ! See, these companies you defend so much don't play the game you so much hold up as important - enthusiast market. MB looks at Lexus and sees in it what they used to be - solid, quality, reliable, a brand you can trust... BMW looks over at Lexus and sees what it may want to be - solid, reliable, quality and aflush with $$$ to spend on building even better cars, and Audi is simply green with envy when it looks at Lexus. These talk about enthusiast is a smokes-screen to cover up the problems your fav brand has. So you pick up anything Lexus doesn't do well, and hold that up and say: A ha.. see, they suck in this, and suck in that... and are non-existent here... Anyone can say the same about any car company.... No one provides everything for everybody. What you need is to give Lexus its due props to start from scratch and become the envy of the industry in so short a time means something....

    With Jurgen gone, MB will have some time putting back its house in order... It will take time and lots of $$$. BMW is unsure which direction to go with its styling (Bangled) and electronic issues (iDrive anyone?), and Audi can't even figure out which of its brand is the lux brand ? VW or Audi ??? Lexus, OTOH, is aflush with money, promising to conquer the world, and Toyota's charge to become world's numero uno in car sales by 2010 looked unstoppable. These are realities.... Lexus goes global soon and they are gonna get it done. MB better gets its house in order quick....
  • merc1merc1 Posts: 6,081
    Ok, more of the same here because Lexus isn't the envy of the automotive industry by any means, especially the European automotive industry. In their home countries Lexus means nothing. No one said that MB or BMW provides everything to everyone, but the do provide more choices than Lexus by far and they're more exciting ones to boot. Lexus gets nothing from me for being the most boring and wannabe brand in the luxury car market. Until they come up something that I'd want they're irrelevant to me.

    You act like no other luxury car is solid, safe and reliable. That is more Lexus fantasy than anything else. Audi is envious of Lexus? Ok, and Lexus must be envious of Audi's designs then because Lexus' look terrible and Audi is considered the industry leader in interior design and at the very least as good as Lexus in areas of fit and finish, if not better according to some.

    If Lexus is the automotive industry they sure have a funny way of showing it by emulating Mercedes with their premier car and chasing BMW in two different segments, only come up short. Mercedes, BMW and Audi borrow nothing from Lexus in the way that Lexus visibly borrows from them, nothing at all.

    Does Lexus lead in some areas? Sure they do. Does BMW and Mercedes lead in certain areas? Yep.

    This theme about Lexus being all powerful and a leader in everything (which is how your posts always read) just plain nonsense.

    M
  • maxhonda99maxhonda99 Posts: 1,289
    "Lexus is not for enthusiasts,"

    You're telling me that yourself and lijflx are not enthusiasts? If you're both not what are you doing on these boards day in and day out? And second of all, what is a *enthusiast*? I think some people have twisted the definition of a *enthusiast* on these boards inside out. Because from experience, I know a whole lot of people who own Lexus' and would think they are enthusiasts!
  • ljflxljflx Posts: 4,687
    I'd cut back on bragging about MB's varied choices because they are going to end soon. That's one part of the reason they are in the pickle they are in. Just watch the changes unfold in the next year under the new management as MB returns to its roots and cuts out a lot of the variations. Variations cost a lot of money to maintain. Not sure what you are going to say about all that once common sense business returns to MB and that is exactly what the new CEO is going to bring to the table. You think the stock market would have reacted as it did if he was going to maintain Juergen's "global everything to all people" policy? Large companies like MB, Lexus etc need to keep it simple. Simplification brings profits. That's why niche brands exist in every industry. That's the pocket change of the market. So if you want to say that a company such as Lexus doesn't excite that pocket change customer that's fine. You're right. But MB doesn't do much to excite that customer either. I've been trying to tell you this all along - you don't go after the pocket change if you really want to be a big player and you just enterred the market. It's not smart business. But if you do it does get you a lot of great write-ups in auto rags that - from a business perspective - are worthless.

    As for enthusiasts I will say there are two levels. People who love cars and people who love nothing but handling on their cars and don't care much about anything else. Most of the latter enthusiasts eventually become the more conservative version. It happens naturally unless you stay single or childless all your life. Your whole argument is for the latter enthusiast type and that is also a 99+% misrepresentation of MB's true customer base. So any comment that Lexus is not competing for MB's customer base is hillarious and as big a misrepesentation.

    OAC is talking about that level two enthusiast in his comments and most of those people don't crave anything from MB in their type of car for that type of driving. They crave Porsche and others. But remember Porsche is to the auto world what the NHL is to the sports world. Very tiny with a purist and extremely loyal base. If Porsche disappears most of the consumer world may not even notice it. Same thing with hockey. In fact that just happened last winter and it almost happened to Porsche 12 years ago.
  • merc1merc1 Posts: 6,081
    Mercedes isn't going to cut the C,E,S, SL, SLK, CL,ML, R or G-Class anytime soon so I have no idea what you're talking about there. When I say MB has more choice (BMW too) than Lexus I mean they have more than just sedans and suvs or a single coupe that drives like a sedan. Mercedes has already stated that after the baby M-Class there will be no more expansion. Now if you mean not so many variants of the same car like a dozen Exxx then you're probably right.

    So now enthusiasts are "pocket change" customers? Mercedes, BMW and Audi all engineer the hell out of some of their cars just for this pocket change group that likes their AMG/M/RS/S products.

    Your definition of an enthusiast is intesting. True I think an enthusiast loves cars in general, but the part about the other group that only likes handling is way off. That say that suggests that handling takes priority over everything else, even styling and hp. I don't know anyone that cares about handling above all else, especially styling and power. They almost always go together unless you're hardcore and want to drive an Elise. Its the total packaged that makes a car like an M5 or SL55 so appealing not just power or handling by itself. And again, you don't have to get a tuner car from MB or BMW or Audi to get a more livelier vehicle than a Lexus either. Big misconception there if you think that. Any run of the mill BMW is still sportier than any Lexus and the average MB isn't nearly as soft and disconnected like you try to imply, regardless as to who is buying them or what they crave. No doubt that latter part about your "type 2" enthusiast eventually becoming "conservative" is an attempt to give Lexus some type of "enthusiast" yet the other cars in the same segment aren't nearly as boring or unnattractive.

    My point about Lexus' "enthusiasts" (which I would say that you and Oac are, nothing wrong with that) these boards is that I don't see how they could love cars in general because no other brand beyond Toyota/Lexus matters. Nor do they care about handling, styling, or big hp numbers (due to these things being deemed irrelevant because Lexus doesn't play there) so to me that is not an enthusiast, not by a long shot. All that matters is if they sell, how much money the company makes (which has absolutely nothing to do with the driving experience) and where they place on surveys. That is about as non-enthusiast as you can get imo.

    No where in my post did I say Lexus isn't competing for MB's customer base. Nowhere. I said that they aren't playing the same game at all levels. Go back and read the post. Nor did I say that MB is soley about or for your definition of a "type 2" enthusiast? Where did you ever get that from? You gave your definition of what an enthusiast is and framed my post around it.

    If Porsche disappears most of the consumer world may not even notice it.

    I think I pretty much stated something similar about this earlier, with most people being consumers not enthusiasts so this is no news to me. People who know and love cars (not just a single brand) would miss Porsche greatly, but you're right the Consumer Reports crowd wouldn't notice.

    M
  • sysweisyswei Posts: 1,804
    So now enthusiasts are "pocket change" customers? Oh my. Mercedes, BMW and Audi all engineer the hell out of some of their cars just for this pocket change group that likes their AMG/M/RS/S products.

    I wouldn't go as far as ljflx on some of these issues. But merc1, you always seem to regard Lexus as some sort of failure because it has failed to please your definition of enthusiast. Please recognize that your definition of enthusiast is indeed a relatively small part of the market. Just look at even BMW's sales:

    1. YTD M3 and M3 convertible sales total only 6% of 3-series unit sales (a bit unfair but last year it was still only 8% for 1h04)

    2. YTD M5 sales are 0.02% of 5-series sales (even more unfair, but last year it was still only 0.2%)

    3. within the BMW product line, the bigger-engined versions almost always sell fewer units than the smaller-engined

    The numbers for BMW, which I think would generally hold true for MB, Audi, etc as well, clearly show that the "enthusiast" - at least your definition of the enthusiast - is a pretty small portion of the market. Something in the area of a few percent buy AMG/M/RS/S versions, I would guess. So Lexus has failed (thus far) to deliver for that 1 or 2 or 3 percent or whatever. I guess that's a big deal to you because you're one of the small minority. It isn't a big deal for everybody.
  • merc1merc1 Posts: 6,081
    I'm going to surprise you here and agree with what you're saying in general, but another part of my point was that when you look at BMW and MB they aren't as staid and rigid as Lexus either. They offer more choice, and I don't mean just AMG/Motorsport vehicles. (The new M5 isn't on sale here yet so if they are selling any they are just left over last generation models.) Even basic MB and BMW models aren't as detached as a Lexus is. Cars like the ES, RX and LS (which define the brand and are their consistent big sellers) are about supreme and total isolation. A 750i Sport or S500 Sport does at least, at the very least offer some sort of pretense of being sporty compared to a LS430 even with its "Euro" option. Of course the BMW delivers on the premise, and S500 Sport is just a little sharper to drive, but still not on the level of the BMW.

    I mean lets pretend I was a Lexus devotee for a second. I know its hard to grasp something like that but bear with me for a second. After I move up from a GS to a LS, then what? A SC430, that drives more or less like a LS430? Then what? With MB and BMW you could spend nearly a lifetime buying their products and still not have owned someting in each of their respective model lines. Ljflx says that keeping it simple is the key to profits just as Lexus is set to expand their number of choices greatly over the next few years. I mean all I read is about the many variants of the next LS and IS. If Lexus does do a IS Sedan (a given), Coupe and Convertible, plus a tuner version aren't they doing the same thing BMW is doing? Now is that too many models? Or is it ok because Lexus will do it? If they have 3 variations of the next LS is that not expansion ala Mercedes-Benz's practice in S-Class? Too many contradictions there.

    M
  • sv7887sv7887 Posts: 351
    Hi All,
    Finally reached a resolution with Lexus. They completed all work on Friday. Here's what happened:
    1) During the initial accident repairs the Tech forgot to put the shims back on the front brakes. This was making that irritating Clunking noise. They did an entire front brake job.
    2) The Front Stabilizer Bar Bushings were replaced again
    3) They replaced the High Pressure Hose on the Power Steering System. (Should have been done last time!)
    4) Redyed the entire leather interior at their cost

    All of the above (with the exception of the leather) was done at No Charge. The asst service manager admitted that I was the vicitim of an overzealous Service Consultant and Mechanic. They promised that only the Shop Foreman would work on my car in the future. I didn't push too hard on the previous repairs. Only the Upper Control Arm was considered not necessary. They did over $1,000 in repairs, so I still came out making money.

    Lesson Here: Always take the time to scrutinize what you are being charged for. Ask questions, and refuse payment if they are not being cooperative. The Service Manager is going to be dismissed and replaced with the Asst Service Manager who has been my Service Consultant for several years. I'm glad they took this seriously in the end.

    This was clearly a minor repair, one that the car cannot be faulted on. It runs like a champ and will be delivered back home on Tuesday.

    Hope this helps anyone in a tight spot with a dealer,
    SV
  • ljflxljflx Posts: 4,687
    Merc - you keep it simple in general and conservatively simple while you are developing your image. Now Lexus is ready to mix in some of that sport and tuning but they won't make that big of deal of it. Just enough to tweak the image is all they will aim for. As for the LS step-up they are bringing out a 12cyl in addition to the LS600 hybrid. Those will be big step-ups. On the sports end they'll have this LF-A. and the IS. That is still keeping it simple.The many model variations of cars like the E-class are what I was referring to.That is costly to maintain. There is nothing wrong with the MB line-up and it fits the general simplification model. But I don't think the G or R-class, particularly the latter, will cut it.

    Syswei - you actually illustrated my pocket change point perfectly with the percentages you threw out there. Brands like Lexus, BMW and MB would be foolish to invest so heavily to gain a tiny sliver of what is a tiny overall market. I'd expect Lexus to throw a halo car or two out there and offer tuning options and that's it. Instead of aiming for that heavy enthusiast market they will deepen the main product line with more engine offerings.
  • sysweisyswei Posts: 1,804
    Well, you know, I'm not going to disagree for a second that Lexus vehicles on average are more isolated that BMW. I say, so what? As a business strategy, it makes sense to be known for something, and to serve a market segment well. Lexus is known for luxury over sport...how can I disagree with that?

    If they tried with every model to be just like the equivalent BMW model, it would hurt them as a company, because there is only a certain part of the market that WANTS a BMW-type vehicle, and Lexus would then have to split that part of the market with BMW.

    It is smarter to keep the identity they have with the LS, ES, and SUVs, and, now that success has been established there, at the margin with select models or new models, try to address other segments. The IS tried to do this, not so succesfully the first time at bat, and as you say we'll see what the second at-bat brings. It looks like the IS500 will be the first attempt at an AMG/M type vehicle, and we'll just have to see how it fares. I really don't personally find it that important, since I'm not the sport type buyer, and since the AMG/M/RS types, as we discussed, are a miniscule part of the market.
  • oacoac Posts: 1,594
    Well said...syswei...

    When Lexus joined the luxury car company they had to distinguish themselves. If they aspired to be like a BMW, they'd fail badly. Rather, MB was a fair target - the brand caters to the affluent and the upwardly mobile people. Many in the public aspired owning an MB in their lifetime. To go after this market seems like a wise decision, and Lexus gunned for it. To further differentiate themselves, they put together (amongst many other things) a world-class customer service program, the likes of which no other mainstream lux car company had. And when you design and build a world-class car like the LS, back it up with a world-class customer and dealer service, at an affordable price, with Toyota's already solid reputation, you have a winner. And hence the Lexus success. Of course, getting ahead of the competition creating a sedan-based SUV, and leveraging your Toyota heritage in SUVs (LC and 4Runner) helps to expand market share and create success.
  • greenbeltgreenbelt Posts: 55
    You said:

    "Well I disagree completely because there is no way that what company earns dictate the design of their cars, it may dictate how well its built or how the specification comes out, but the design/styling and the way it handles/drives and the other nuances of a brand aren't determined by this in the least. When it comes to design, dynamics, styling etc. it comes down to what a company thinks a car should be for a particular segment, not how much money they earned last year."

    I still feel you are looking at this the 'old fashioned' way, in that companies operate by designing and building what they think a product should be for a particular segment. That's bassackwards in plainspeak.

    Companies that operate the way you suggest these days struggle to hold customers. The Euros all do this. They've got that old fashioned German scientist engineer thing down pat where they think they know what's best for the customer. Unfortunately, this kind of rocket science has got them in a lot of trouble.

    Companies that design cars that their customers buy in droves are in fact designing and building exactly what the market wants, not what they think the market needs. The measure of success is the money they make, the share they gain, the positive press they receive.

    Companies that are in trouble financially are failing to make what the market wants.

    Why do you think MB dumped its boss this week? Because the board thinks the cars don't handle right or ride right? No, I think he failed to realize the hole he had dug and couldn't get them out of it. New management was needed before this turns into their own Little Big Horn.
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