Howdy, Stranger!

It looks like you're new here. If you want to get involved, click one of these buttons!





High End Luxury Cars

1479480482484485771

Comments

  • stevekilburnstevekilburn Posts: 359
    Thats why I said, price LS 460 against 7, which means LS will still have a "HUGE" $14,000 advantage over S550 (72K versus 86K) which will make smart buyers like you very happy!

    And ensure continued eloquence from poets and thinkers like Tagman. ;)
  • ljflxljflx Posts: 4,687
    "Thats why I said, price LS 460 against 7, which means LS will still have a "HUGE" $14,000 advantage over S550 "

    And the S450 will have a large advantage over its S550 brother too. Sorry - your point just doesn't make any sense to me.

    As for my comment re Tagman - change it to eloquently and smartly. The thought of Tagman as a poet never, ever enterred my mind. The thought of him as a smart businessman did.
  • oacoac Posts: 1,594
    Tag:

    There is much you said in this post #15303 that I agree with. I just would like some bit of clarification for my not-so eloquent or smart head:

    It brings up the question: is this "value" perception a "perception" or "misperception"? That is more subjective, but I will tell you that it is a genuine perception, and it must be for the formula to work. Lexus vehicles are in fact a great value.

    I am sure you do know that the concept of "value" is in the eye of the beholder. Buying a $60K car is NOT a value buy, imo. You got to have some change in your pocket, make/have sizable money, and have the smarts...and of course, brand-conscious. When you buy a HELM car, its not about VALUE... I didn't buy my LS400 bcos it is cheaper than an MB. I wouldn't buy an LS460 bcos it is cheaper than an S550. Far from it. That it is cheaper is only an icing on the cake. There are lots of reasons I own an LS, not one has to do with it being cheaper... Not one...I tell you.

    If you haven't heard me say it, I'll repeat it here. One of the reasons I do NOT own an MB is bcos I consider it a brand of the past. It is a brand my parents, and their parents lusted after. Not for me. I want a car of today, a new brand... Call me anti-establishment if you will... Lexus is the new kid on the block. They have cars that appeal to me - understated elegance, luxury, refinement and reliability. If they are cheaper, I am happy for it...

    For what the LS offers, you'd be hard-pressed to find a better buy among its peers. I won't overpay for an MB or BMW just bcos... The LS430 is as fast as the S430 or 750i. It is as or more luxurious. It is as or more refined. Its build quality is equal to or better than its peers. It may not drive as well as say a 750i, but it sure is more reliable. So I give up something, for something more important to me.

    If I need to drive a car to feel all the ruts and imperfections of the road, I'd buy a real sports car - a Porsche.
  • tagmantagman Malibu, CaliforniaPosts: 8,441
    As for my comment re Tagman - change it to eloquently and smartly. The thought of Tagman as a poet never, ever enterred my mind. The thought of him as a smart businessman did.

    Lj - much appreciated.

    BTW, I just saw another new S-Class this evening . . . a black one. I'm now fairly convinced that black may very well be this car's best color. Interestingly, there was a CLK parked right next to it, and I was surprised at just how much larger and much more prestigious the S looked. The CLK looked plain next to the S.

    Also, good clarification on those posts to steve.

    TagMan
  • tagmantagman Malibu, CaliforniaPosts: 8,441
    There is much you said in this post #15303 that I agree with. I just would like some bit of clarification for my not-so eloquent or smart head:

    oac - I never asked for the description "elequent" or "smart", but I'll accept it as a compliment, because I believe that is what it was meant to be. Heck, I've got to take it when I can get it, right? ;) Otherwise it's all downhill!!

    Anyway, you asked me to clarify and I will.

    Firstly, yes I know that "value" is in the eye of the beholder. But I also know that when a whole lot of "beholders" are using the same eye, and seeing the same "value", then something must be going on.

    Buying a $60K car is NOT a value buy, imo. You got to have some change in your pocket, make/have sizable money, and have the smarts...and of course, brand-conscious. When you buy a HELM car, its not about VALUE.

    I disagree. IMO, "value" does not necessarily have price constraints or cut-off points. "Value" can exist in numerous price tiers for numerous products. It does not necessrily mean "cheaper", as you put it.

    You said that when you buy a HELM car, it's not about VALUE, but I would have to say that MANY LS buyers perceive "value" in their purchase, and the LS is a HELM vehicle. Perhaps many HELM buyers do not consider the "value" factor, or if they do, they have a different perspective of what "value" is. In any event, the fact is that the LS is a HELM vehicle and that many of its buyers do consider it to be a great "value". There is simply no way around this, IMO.

    For what the LS offers, you'd be hard-pressed to find a better buy among its peers. I won't overpay for an MB or BMW just bcos

    There you have it. You are expressing the "value" as a "better buy" in your own words. You asked me for clarification and I am giving it to you. As I said, perceived "value" does not have to mean "cheaper", and I know this is important to you. It does, however, generally include the perception that you are getting the most for your money. And, quite honestly, that is what you are expressing as well, IMO. So, what's wrong with that? Absolutely nothing.

    Did I answer OK? (I don't want to be too darned eloquent!)

    :)

    TagMan
  • merc1merc1 Posts: 6,081
    Thanks for the *refresher*.... Great, I did write such back in Nov 2005. Anecdotal evidence did show (and still does show) that the levels of interest on Edmund's for the S550 v LS460/600 are far different.

    But here is the thing OAC, nno one said anything about who had the greater interest, ever. You're changing the points during the debate here and I think you know this. When did I ever argue that the S-Class had more interest than the LS? At no point did I say or even imply that.

    The point was that the amount of posts on a particular mesg board really has nothing to do with how well the car will actually do in the marketplace. Your implication was that a lack of posts on the 07's S board somehow spelled trouble for the new S-Class in the marketplace, yet the exact opposite has been the case so far. That was the point. Oh, and on the 07 LS board there is much more activity for sure, but like I stated way back when its usually the same folks posting daily, hardly a indication of much either.

    Both of these cars have a such a following and track record to the point where we know they're going to sell so trying to imply that the S was in trouble due to a lack of posts here at Edmunds was really reaching.

    This never had anything to do with "who has the most interest" here at Edmunds.

    A poster on the 2007 LS board from Japan did say that Lexus is stopping production of LS430 and ramping up LS460 due to a higher-than-anticipated level of interest from the buying public. Such anecdotal evidence supports my previous theory that the level of interest in the LS will far outweigh that of the new S.

    I have to remind you that MB and buyers are running into demand-based "problems" with the S-Class also. Good or bad, Mercedes badly underestimated the demand for fully loaded S550s and thus has a backlog of orders, this according to actual buyers/owners at places like MBWorld and other dedicated MB sites.

    Lexus stopping production of the LS430 to start building the LS460 is a natural progression to a new model so please don't hype it up to be some kind of gigantic shift in the way carmakers do business. This happens at every company with every model when a new model is about to go into production. Why hype it up be something that it isn't?

    By the end of 2007, we will know for sure which of these cars has WON the battle of the titans in the HELM space, at least in the NA market. Wanna bet if all these anecdotal evidence points to a winner already ?

    Depends on what the criteria is. If we're going to talk sales then I'll already give you that since the 86K S550 looks to be the entry price for the S-Class for the foreseable future. The LS460/L probably won't cost that much unless it is L model and fully loaded, but we'll see.

    M
  • merc1merc1 Posts: 6,081
    But here is my biggest blunder yet for the S550: Why is it that the previous S430/500 could be equipped no-cost with 4Matic and the new S550 tacks on a $3k tariff to have the safety of AWD. M-B says the 4Matic will account for 20% of all S550 sales. They may have a tougher time moving them, then, again, this is MB were talking about........

    Well that was only done for the last couple of model years on the W220 as an incentive to keep them selling. Prior to that it as an extra-cost option.

    The new LS460 appears not to have AWD so the S550 4Matic will likely be in hot demand for those who really new AWD.

    I just wish Audi would promote Quattro (A8 in this case) more in certain MB strongholds in the North and Northeast.

    M
  • merc1merc1 Posts: 6,081
    Really ? This is the reason for Lexus' existence ??? As a lower-priced version of MB ? Shocking !!!!

    Is this you're way of saying that Lexus didn't come to be based on offering what they think is the equivalent to a MB for a cheaper price? If so you're mistaken on one of the key building blocks of your fav brand.

    This is solely bcos MB rips off its buyers with everything as options. Geez... Imagine having leather as an option on a $36K MB ! BTW, Edmund's TMV has the C350 starting at $36,427, the IS350 at $35,194, the 330i at $35,157, and the A4 at $35,318.... Pretty much a-wash for all these cars. That MB mystique and brand doesn't amount to much in the lower cadre, I suppose.

    Do we really want to get into the options that Lexus offers on the IS or LS? You write this as if Lexus doesn't offer any options. Sure they often have more standard equipment true, but they aren't option-free either. Quoting a bunch of base prices doesn't change this or disprove what I stated earlier about a Lexus still being cheaper in most cases when it and the German cars are comparably equipped. The IS350 is really the only one that stands sticker to sticker with the Germans when fully loaded because the GS and current LS surely don't compared to a S-Class or 7-Series.

    M
  • merc1merc1 Posts: 6,081
    I'll defer to you on this, but as I recall the 4-Matic came with a lesser (4 speed?) tranny than the 6 speed (?) that came on the non AWD S. So, you could get AWD or a better tranny for the same price. Now, apparently, you get the good tranny with either the AWD or the standard config. This might explain the price difference.

    Well it was acutally a 5-speed on the 4Matics vs the 7-Speed on the RWD models. Ouch, please don't say 4-speed automatic those went out in MB's back in the early to mid nineties...lol!

    The price difference or lack thereof on the previous S-Class' final model years was done as an incentive to keep the car selling. This S has to go 7 years so I'm sure they'll make it a no-cost option again once the W221 gets tired.

    M
  • merc1merc1 Posts: 6,081
    Finally something I can agree with you on! I've been reading this between Steve and Tagman and I'd have to say too it wouldn't be wise for Lexus to price their cars at the same level because one of their main selling points was the price advantage vs Mercedes which allows them to price their cars at or above others in the HELM sector this time around, but still cheaper than Mercedes. You and Tagman are correct on this one it is a brilliant strategy that doesn't need tinkering with. The really briliant part is that this allows Lexus to always be a few dollars below a Mercedes but over Jaguar and Audi and roughly in the same general area as BMW. That equals lots of $$$ for them.

    Well actually there is one point in your post I don't fully agree with. I think at this point MB doesn't just say lets price the cars wherever we want to because as you know their whole structure (as is all Germans) is much more problematic (unions/exchange rates/ etc.) than the Japanese's is in general so they really can't scale back things to far. German quality costs and more so for BMW and MB than Audi because Audi has VW to spread the costs around. MB has done some price checking reality with the new S to a degree, but most of that price difference I don't think is there because they want it there IMO. A Mercedes has always been more expensive than all the other cars in the segment and like you stated in the past it was clear as to why. Of course we both know of their troubles over the last few years, but as far as sheer build quality goes they've correct their ways and the reliability results (on the new S at least) are still pending. My point being is that if they correct this before everyone in the free world has a problem with a Benz they'll always be able to charge a premuim over the competition. Now if the new S turns about to be like the previous one (which it isn't as far as build is concerned) in reliability then yeah you're correct about their ability to keep charging a premium over the competition. MB's way of pricing their cars goes back a long time and people have bought them at those prices for just as long so its going to take more than a few bad models during a certain amount of years to change that forever. Other than the W220's reliablity and initial build quality the S-Class' rep is in tact one model isn't going to destroy the years and years of rep this car has built up ruling the luxury car market.

    M
  • merc1merc1 Posts: 6,081
    Great post. Value, relative to a Mercedes has always been a huge part of why people who've shopped both buy a Lexus. Not the only reason as OAC points out but it is a factor for many. You see it in posts a lot here and on other boards.

    The meaning of "value" I think takes on a different meaning here compared to a Camry/Accord/Altima buyer who is likely looking the just the payments and to a lesser degree at the actual cars as to what they have or don't have in the way of styling, features, performance etc. etc. Just what I think.

    M
  • sysweisyswei Posts: 1,804
    Now is the time, NOW! If lexus can shatter the cut-rate value myth, then it will truly gain a quantum leap to the next string of evolutionary spirit.

    What do you mean by this? Do you mean that you think Lexus should price its products on par with MB?
  • ljflxljflx Posts: 4,687
    "Now is the time, NOW! If lexus can shatter the cut-rate value myth, then it will truly gain a quantum leap to the next string of evolutionary spirit."

    I think Lexus in more interested in profitability and has zero interest in steve's pricing obsession.
  • designmandesignman Posts: 2,129
    Yep, that's what he means. Gotta raise the prices to appeal to Europeans and those of us who savor the philosophical, cultural and intellectual essence of firing up stogies with 100-dollar bills.

    Hey, remember the movie Back To School when Rodney Dangerfield was making a hero sandwich, pulling the inside dough out of the bread loaf to fit extra cold cuts, then saying "I learned this in Europe"? Maybe that's kind of in line with what Steve is talking about.

    It's the genius factor. Perhaps we all need to go back to school.

    ;-)
  • blkhemiblkhemi Posts: 1,717
    "I just wish Audi would promote Quattro (A8 in the case) more in certain MB strongholds in the North and Northeast."

    Agreed. But from what I hear from Ingolstadt, the '09 replacement for the current A8 will correct all of the wrong-doings here in the States. It's said to come to market with a 4.2 FSI V-8 with about 470-hp/8-speed tranny as the "base" engine and a "clean" V-10 TDI within the first year it comes to the States. No more of that first year (remember the '04 commercials) marketing/commercial ads then just turning their backs on the FLAGSHIP sedan.

    So it all remains to be seen. I'm not giving up on my favorite German brand!!
  • houdini1houdini1 Kansas City areaPosts: 6,065
    Yes indeed. Raising Lexus prices would certainly help me out and probably prompt me to rush out to buy a couple of LS's. I certainly can't be expected to spend my money fast enough under the current state of affairs.

    I've been worried sick because all my friends and allies in Europe are having to endure the hardship of the artificially low prices that have been foisted upon them by Lexus. I mean really, who would be interested in value when you could have added "cachet".

    2013 LX 570 2010 LS 460 2002 Tacoma 4x4

  • ljflxljflx Posts: 4,687
    Yes indeed also. I just can't wait to write a check out to Lexus for an additional $20K of pure incremental profit to them and then tell people look at the even more expensive car I drive - it's a real HELM now to someone on the Edmunds board. It just goes to show you how silly seeking status is.
  • stevekilburnstevekilburn Posts: 359
    S450 and S550 are from mercedes, sure those who want less power and save a few dollars will go for S450, but thats not my point.

    We are talking about competition and price premium here. Once you gain market presence and your brand is well known and respected, the next step is to bring the "prices in line" with your competitor to gain maximum reward for your effort.

    "Value" pricing by lexus is a great way to sell vehicles, but independence from "value pricing" and commanding the same price premium as your competitors is better in my opinion.

    This is not just marketing talk or resale value argument, the argument here is

    "commanding the price premium for a new HELM".

    By implying that S550 is over priced and that being the reason why its resale price is not as good as that compared to LS does not make sense. There are other factors involved such as quality, design, recent perceptions, reliability, technology (well sorted technology) etc etc.

    The reason why I am obsessed with price for LS is because I am in business too and if I can lead my brand away from "value within HELM" image to a "premium HELM" image I would make all out effort to do it.

    I believe the LS 460 has the goods to make that transition and its up to lexus to see if they are wise enough to seize the moment.

    Also the comment that why change a successful formula, and keep it simple is not a good idea. The "value" formula is good today but what about tomorrow.

    We must consider evolution of brands. The LS was selling so well, they need not put more performance in it, but why did lexus introduced a 380 hp V8 and emphasized "unique connection to road" and driving dynamics in the upcoming LS?

    The reason is simple, its time to evolve and add more qualities to the vehicle and adding premium pricing is one of those things that makes up the image of the brand too.

    Also, I am not proposing LS should charge as much as S550, but it should at least be head-to-head with 7-series.

    Which means if 745i = 72,000 then LS 460 = 72,000 too
    and 745Li = 76,000 then LS 460L = 76,000 too

    still thousands of dollars cheaper than S550.

    This kind of pricing will likely reduce the "volumes" but the extra price and profits will more than make up for that.

    Thats my honest opinion, now its your turn.
  • tagmantagman Malibu, CaliforniaPosts: 8,441
    steve - are you suggesting that Lexus is not bringing in enough profit for Toyota? Are you also suggesting that the vehicle's profit margins are skinny? If anything, they are very healthy, my friend, and I wish I owned a Lexus dealership or two myself!!!

    There is plenty of profit at the current price strategy. Fact is, there is generally a better profit margin on a lower priced Lexus than on a higher priced Mercedes!

    You've made your point, but you keep on grinding. READ all the counterpoints and consider the merit in them. I have to admire you for your high-spirited nature, but c'mon already, let's move past this campaign of yours to raise Lexus prices.

    If you do not believe me, ask ljflx. You have already complimented his business knowledge. Ask him if a Lexus dealership is in need of higher prices or margins. I'll bet he'll tell you that they are doing just fine with the current winning strategy.

    TagMan
  • stevekilburnstevekilburn Posts: 359
    well said oac.

    The LS 460 now needs to evolve into a true premium HELM and price should be a head to head with 7 and A8.

    And it will still have a 14,000$ price advantage over S550.

    It will still be "GREAT" value since the quality and reliability and resale value will be higher than 7 and A8.

    The driving dynamics will greatly improve too. May be (just a guess) as good as 7.
  • ljflxljflx Posts: 4,687
    There are so many things wrong with your argument that I don't even know where to begin. But let's stop with the obsession with the S550. You act like that is the only car on earth that the LS should care about. The LS truly competes with the S450 whenever it's released, and previously the S430. The LS600HL is the car that will compete with the S550. Steve - you need to get real. They have a major build cost advantage over Mercedes and you want them to act as if it doesn't exist. In the next 1,000 years of business - pick any business you want - that is NOT going to happen.
  • stevekilburnstevekilburn Posts: 359
    No I am not suggesting a lack of profit. Lexus makes good, indeed great profits.

    My argument is not profits, resale value, etc etc.

    Please read this and repeat a few times:

    "Commanding, I repeat; commanding the same price premium as A8 and 7"

    and evolving out of "value HELM" phenomenon, while still preserving and augmenting profits and revenues.


    Thats what (in bold letters) I want to say, now the ball is in your court, its your turn.
  • tagmantagman Malibu, CaliforniaPosts: 8,441
    steve - if value is an integral part of Lexus success, what is wrong with it?

    TagMan
  • stevekilburnstevekilburn Posts: 359
    Ljflx (what is your real name btw? :) )

    I agree with your build cost advantage, and no I am not saying they should not have that, or that they should not use that as an asset.

    I repeat my earlier post on build cost and profits.

    S: cost price: 150 $ , selling price: 200$
    7: cost price: 140$, selling price: 190$
    LS: cost price: 110$, selling price: 170$

    You see, Lexus has a build cost advantage of 40$ over S and 30$ over 7-series. It also makes 10$ more than Benz and BMW. We "BOTH are in agreement here"

    But thats "NOT the issue". The idea here is

    LS 460: cost price: 110$, selling price SHOULD BE: 190$

    similar to 745. WHY?

    Because LS has superior quality and reliability, better fit and finish, better craftsmanship, potent V8, greatly (I hope) driving dynamics due to completely revised multi-link front and rear suspension, cutting edge technology, as advanced, perhaps more than benz and bmw, and therefore "NOW IS THE MOMENT" it should move away from "value HELM" to a "premium HELM".

    That would bring in extra 20$ profit, and therefore improved bottom line, greater ability to invest in R&D to improve fuel economy and reduce pollution, more power and performance and still better products.

    Let me give another Example:

    Star Foot-ball player A: experienced, famous and in his prime commands 50 million$ in his contract over 5 years.

    Star Foot-Ball player B: a new kid on the block, but VERY talented, CAN command 45 million$ for his contract over 5 years, but lo and behold he says, "I WANT ONLY 30 million$, because I am offering value!!!!!"

    How funny? Now its your turn.
  • tagmantagman Malibu, CaliforniaPosts: 8,441
    steve - you said you are in business, too.

    In my business, we have a standard operating policy to ALWAYS give the client MORE than they expect. We are not cut-rate, but we do provide value, and we have one of the highest satisfaction ratings in our industry.

    Based upon all your arguments, you are saying that Lexus could "command" more money in your opinion. YES, exactly the point! You perceive that value, and it is a good thing not a bad thing. Without that belief, you would not be so passionate about the value.

    Value is good . . . it means that the buyer is getting the most, or certainly more for their money from their perspective.

    TagMan
  • tagmantagman Malibu, CaliforniaPosts: 8,441
    Star Foot-Ball player B: a new kid on the block, but VERY talented, CAN command 45 million$ for his contract over 5 years, but lo and behold he says, "I WANT ONLY 30 million$, because I am offering value!!!!!"

    Absurd. What's his build cost? This is not an appropriate analogy.

    Steve, what is wrong with value? It's your turn!

    TagMan
  • tagmantagman Malibu, CaliforniaPosts: 8,441
    You are way out on a limb here.

    Your argument is still a campaign to get the most money possible, as YOU see it. That is no longer value.

    While I see your point, I am a full 180 degrees from agreeing with it. Sorry, you won't change my mind, and I won't buy a Bose stereo either, dude. ;)

    TagMan
  • stevekilburnstevekilburn Posts: 359
    Build cost is the years of rigorous training.

    Player A the blockbuster Guy has trained for 8 years under famed coach X

    and player B, new talent has trained for 6 years (2 years less) under coach Y who is smarter than coach X.

    So player B's build cost is lower and both A and B CAN go head to head according to public assessments and pundits.
  • stevekilburnstevekilburn Posts: 359
    Your comment "Your argument is still a campaign to get the most money possible, as YOU see it. That is no longer value"

    would have been correct if I had said

    "LS 460 should be priced 82K and 460L should be 86K to match S550"

    But thats not what I said. I said "LS 460 should be head-to-head with A8 and 7" so actually there is still "TREMENDOUS" value, more than $10,000 compared to Benz. Thats more than 13% discount!!!!!

    And lets not forget A8 was introduced in 1994 so its brand heritage is even more sketchy than LS.

    we both are on zero degree and perfectly aligned, and regarding 36 hours, LOL!
  • stevekilburnstevekilburn Posts: 359
    I think LS 600hL will compete with A8L W12 and 760Li, not S550.
    V8 hybrid with 430 hp to compete with 438hp 760Li and 450 hp W12, not 380 hp S550.

    But it will be priced in the S550 ballpark. So it will be "LOADED WITH VALUE".
Sign In or Register to comment.