High End Luxury Cars

blckislandguy · May 2006

ljflx, I think that this ad is for the Spyder. It was part of the same ad in Friday's NYT Weekend edition.

Please note that Edmunds says that a 911 will return 50% of its MSRP in FIVE years with fully 15K miles per year. So, a HELM customer could throw down 80K to buy a 911 and get back 40K after five years vs. throwing down 112K on a Maser and getting back 50K after four years. Remember guys, its not what you paid for it that counts, it is the difference between what you paid for it and what you can sell it for that matters.

Does anyone want to speculate on the 2007 S Class pricing? From what I see, sales have taken off. (I do get a kick out of all these ex-student radicals who just 35 years ago were marching in the streets and are now pulling up to valet parking in S Classes.) With a MSRP of 87K what would be a realistic price? From what their web site says, the Premium II package isn't yet available and, to me, the Premium III package seems aimed at the AARP crowd. Rather than the Premium III package, you could join a very nice gymn, maybe even the New York Athletic Club, if you have trouble with your turning your neck, checking mirrors, and/or need a massage for that kind of money.

houdini1 · May 2006

Fine. Then just substitute A8 or 7 series for S class. Lexus is putting relentless pressure on all helms to justify their inflated prices. Call it value vs prestige if you want to but I call it real value vs smoke and mirrors.

tagman · May 2006

Tag

Lexus doesn't have an image problem.

Doc, I'm sure hoping that you actually read my post, because I NEVER said that Lexus's problems were with its image. I spent a good deal of time writing that post to indicate the OPPOSITE of that. I thought I was quite clear when I said that the Lexus image was in fact so STRONG, that it was stronger than the product line itself. And I supported that opinion with what I believe to be concrete reasons. Read it again. I stick with my opinion, which I believe was quite fair and balanced. You are most certainly entitled to yours, and I have no issue about respecting it, but please don't mis-quote me by a whopping 180 degrees.

Or . . . by some miracle were you actually AGREEING with me that Lexus doesn't have an image problem, and that its strength causes a descrepancy or disparity between that strong image and the overall product lineup itself?

Which is it, Doc . . . Are you mis-quoting me or agreeing with me?

TagMan

lexusguy · May 2006

I think the current ES formula is working just fine. There's simply no way to make a car like that with that level of equipment at that price on a unique platform without a massive, totally unnecessary price increase. The ES is so good at what it does that it killed the I35, and frightened the TL away forever. Today, no import dares compete with it. Why would you they want to rock the boat with a cashcow like the ES?

Toyota is most likely waiting until the new Tundra and Sequoia are ready, and will then kill off the LX (and probably the TLC as well) and replace it with something based on the Sequoia. This will allow them to cut the price and better compete with the Q7 and GL.

jrock65 · May 2006

Infiniti is a successful flagship away from being on the same level as Lexus.

Now, Infiniti will never match Lexus in sales, because they will not sell a lux version of the Altima (a la ES/Camry) or a lux version of the Murano (a la RX/Highlander). But in the segment that it's in (other than the flagship segment of course), it matches up pretty well against Lexus.

The G competes well against the IS, and the M competes well against the GS.

The QX is an embarrassment though. Same interior as the Armada, and quality problems.

So... after 16 years of failure, what do you think will convince people to buy an Infiniti flagship?

merc1 · May 2006

It is very interesting how all these brands go through their ups and downs when it comes to new product intros.

I remember when Lexus stated that they wanted that constant product buzz that the Germans, specifically BMW and Mercedes-Benz seem to automaticall get because they're seemingly always introducing something new.

Right now it is Mercedes-Benz. Edmunds has covered at least 3 AMG Benzes in just that many weeks. First the CLK63, then the E63 and now the CLS63. Then you have the GL450 making the rounds in print reviews as will those new AMG models over the next few months. Then you have the CL which should be shown sometime this summer I'm guessing. It seems like pics of the CL, next C-Class and smaller version of the ML (GLK) are constantly plastered everyone. They're on a break-neck product offensive now.

Someone earlier noted that Lexus' SUVs need some attention, but when I think about their car doings over the last 12 months its staggering. A new GS, IS and now ES and the big whopper, the LS in a few more months. Not the same level of press buzz overall as Mercedes due to the timing of the intros, but still. The LS460 range alone will carry the brand until they can revamp the SUV lineup. Then you the GS twins get some juice this fall also. Out of all of Lexus' upcoming products I want to see the production version of the LF-A and rumored IS Coupe and whatever the hi-po version of the IS the most. One of these just has to be good looking!

BMW has a new 3-Series coupe coming this fall, the 335i that will be within 30 or so hp of the outging M3! Progress folks. Other than that it seems that BMW will be quiet for a little while, unless that new X5 is going to show up sometime before year's end. The M3 and M6 Cabrio are coming too, you just know it. The 335i sedan is going to be a direct answer to the IS350 and upcoming G35 with its 300hp rating.

Then you have Audi - pretty much on a product roll right now. The Q7 I think will do some serious numbers for them, but their other additions this year are of the image, not high-volume sales variety - RS4, S6 and S8. Lots of speculation going around now about their CLS fighter and mini-ute the Q5. Its the R8 that I'm waiting to see. I really think people would love Audi if they made more shopping lists. The problem isn't undesirable cars.

I can't wait to see the production version of that sleek Infiniti Coupe that made the auto show rounds this year. The sedan hardly looks changed, but it is yet another attempt at 3-Series level greatness. Not sure what is next for the M35/45 twins. It appears that Nissan will be getting the next generation performance coupe, not Infiniti. Not sure if that was a wise decision. What else is in rumored for Infiniti??

I truly believe that somewhere is the deepest, darkest most secretive development labs in Honda's Japanese headquarters they're working a RWD platform for the next TL/RL. Remember where you heard it first!!!

M

brightness04 · May 2006

Out of some 100,500 cars that MB sold in April, only 8,500 were S-class.

merc1 · May 2006

Infiniti is a successful flagship away from being on the same level as Lexus.

I'm not sure about that. Infiniti still isn't a full lineup provider on the level of Lexus. They don't have a convertible and it appears that they aren't getting the GTR either. Infiniti' SUV lineup also pales next to Lexus' though I'd take a FX over a RX anyday. The QX like you stated has hit the skids in several areas while the Lexus LX (though outdated) is pretty much an icon compared to the QX.

With the 07' LS Lexus has built up too great of a lead over Infiniti in that area for Infiniti to catch up now. I'm starting to see some hairline cracks in the whole Nissan/Infiniti comeback. Lexus is also set to introduce that LF-A sports car while Nissan dealers get the car that Infiniti should be getting as their respose, the GTR.

I still think Infiniti are more desireable than Lexuses in nearly every class, but as far as clout/status/prestige etc they have a good ways to go before matching Lexus IMO.

M

brightness04 · May 2006

IMHO, G and M does better than "compete well against" IS and GS. However, ES and RX are what makes Lexus such as success. That's where the money comes from to bankroll everything else, just like 3 series for BMW. Infiniti has not quite mastered the art of leveraging its plebian product into something "desirable" at significantly high price point, perhaps due to lack of execution in details.

brightness04 · May 2006

Competition is fierce out there. Hardly any model can maintain MSRP after 6 months on the market nowadays. MB and BMW are often resorting to lease subsidy to attain effective price parity with Lexus. Not sure if that is a sustainable proposition given their higher cost. Consequently, we may see more "tuner" type updates (what used to be done by a couple guys in a garage after beers, namely, dump a bigger block in the engine bay, crank up the turbo boost, etc.) instead of more completely new platforms, which would actually take much more engineering resources.

lexusguy · May 2006

It appears that Nissan will be getting the next generation performance coupe, not Infiniti. Not sure if that was a wise decision. What else is in rumored for Infiniti??

I truly believe that somewhere is the deepest, darkest most secretive development labs in Honda's Japanese headquarters they're working a RWD platform for the next TL/RL. Remember where you heard it first!!!

Infiniti doesn't have a whole heckuva lot going on right now. The FX just received its mid-cycle refresh (very minor, really just a much needed interior upgrade). The M35\45 and QX56 will most likely continue without any changes for awhile. Now that they dont have the GT-R, its all down to the G35. New sedan, followed by coupe, and possibly a convertible maybe after a year or two. I dont think there will be a new Q45 before 2008.

There's a chance that the next RL could be RWD, as clearly the current car is a flop. The TL I'm not so sure about. I think an SH-AWD option is a definite possibility, but I dont think it will get RWD. In any case, we wont be seeing a brand new TL or RL before 2010 or 2011.

lexusguy · May 2006

I'm starting to see some hairline cracks in the whole Nissan/Infiniti comeback. Lexus is also set to introduce that LF-A sports car while Nissan dealers get the car that Infiniti should be getting as their respose, the GTR.

Very interesting observation, I think you could be right about trouble brewing for sustained Nissan\Infiniti growth. One thing is for sure, the decimation of Nissan NA because of Ghosn's "grand idea" of moving HQ from CA to TN certainly won't do anything to help them.

The GT-R is not really a competitor to the LF-A, or Acura's next NSX. It's using production based parts, and is going to cost half as much. If Toyota ever actually makes the Supra and charges $60-70K for it, calling the GT-R a Nissan could be a good move.

merc1 · May 2006

In any case, we wont be seeing a brand new TL or RL before 2010 or 2011.

That seems like a long time doesn't it? I can't see the RL going that long in its current form, but I think we'll see a new TL for the 2009 model year.

I really think Infiniti should have been the brand to see the GTR under here in the U.S. I mean Nissan already has a sports car, the 350Z. Then again this car has its own amount of prestige for those in the know so keeping it a "Nissan" is keeping it "true" I guess.

M

merc1 · May 2006

The GT-R is not really a competitor to the LF-A, or Acura's next NSX. It's using production based parts, and is going to cost half as much. If Toyota ever actually makes the Supra and charges $60-70K for it, calling the GT-R a Nissan could be a good move.

You're right, never thought about it that way. With a V10 or V8 the next NSX and Lexus LFA are going to be 100K+ cars easily.

Now if there was ever a Toyota I would buy it would be a Supra. I would want it priced like the 350Z with better styling and a high-quality interior than the Z, that would be a knockout. They can use the new V6 from the IS350 tuned with a little more power as a base engine. That would be hot. I'm still stunned at how good the new Camry looks on the road in SE trim. For a Camry...my goodness they did a bang up job. The ugly Toyota emblem and its placement is the only thing that messes up the design. It is by far the best looking Camry ever and must give all others in the segment an even bigger headache now that it actually has some looks.

M

lexusguy · May 2006

Infiniti has not quite mastered the art of leveraging its plebian product into something "desirable" at significantly high price point, perhaps due to lack of execution in details.

What plebeian product does Infiniti have left? The G20, I35, and QX4 are all dead. I think the biggest problem with all of those cars is they were transparent rebadges of Nissan products, with essentially zero justifaction for big price increases other than slightly different body work. Infiniti never learned how to do products like the ES and TL, or RX and MDX. The QX56 shows that they still don't understand that you need more than a wood steering wheel to make a "luxury version" of one of your regular products.

lexusguy · May 2006

That seems like a long time doesn't it? I can't see the RL going that long in its current form, but I think we'll see a new TL for the 2009 model year.

It does, but then the last RL ran from '96-'04. Gen 1 and 2 of the Legend both ran for a normal 5 years though. I'm not really sure why Acura chose to just throw the first gen RL in the closet and forget about it.

So far the "rescue the RL" plan seems to be just cutting a lot of the tech stuff out to try and get the price down by a few grand, which will probably happen when the car is refreshed, probably '08.

lexusguy · May 2006

Now if there was ever a Toyota I would buy it would be a Supra. I would want it priced like the 350Z with better styling and a high-quality interior than the Z, that would be a knockout.

Unfortunately, it doesn't seem like they are interested in going after the 350Z, S2000, and RX-8. The rumors say that Supra is going to be a V8 (probably the Lexus 4.6L or 5.0L) powered Vette killer, with a price tag to match. If they do two trim levels again, then I suppose a less expensive V6 version could be possible.

I agree that the Camry SE is a sharp looking car. Honda has their work cut out to match that.

It's actually somewhat ironic that the GT-R is going to be a Nissan in the US. In the past, the car was just the hottest version of the Nissan Skyline coupe, which is our G35 coupe.

drfill · May 2006

If you've been checking your Supra forums, or Toyota websites, you'd know that Toyota has said, point blank, "They have no plans to resurrect the Supra".

I've read Mr Clemens say in an interview, about 2 years ago now, that management sat down and had to decide which they were going to make, a new Supra, or the FJ Cruiser.

And we lost.

Toyota needs another SUV like they need hole in the head.

They do plan to "resurrect" the 2000GT name in 5000GT form.

The Supra was what made me a Toyotaphile.

DrFill

lexusguy · May 2006

Well, the FJ Cruiser does make a lot more sense from a business standpoint, with its off the shelf engine and platform. Plus, with the demise of the Celica and MR2 Spyder, Toyota really isnt in the sports car business anymore. Better to leave it to leave it to Nissan, Honda, and Mazda.

brightness04 · May 2006

That's exactly my point. Infiniti never learned how to turn the company's (in this case Nissan) plebian products into something "desirable" to justify a higher price point as Infiniti. I agree with you completely that, after the failures of G20, I35, and QX4, QX56 is just the latest manifestation of that inability. IMHO, it's due to Ininiti's lack of execution quality in details.

tagman · May 2006

The entire recent history of Nissan, even back under the Datsun badge was basically second fiddle to Toyota. Only the early years with the 240Z, the truck, the B210 and the little 510 poor-man's Bimmer were good for the company. Then Honda came on strong and even Mazda in the early days with the RX7. But Mazda's early rotary engines blew seals and that changed their fate.

Nissan somehow didn't get with it. Always close but no cigar.

Only in these recent years has Nissan had a wind in their sail, but it is quickly fading out.

There are troubled waters and rough roads ahead for Nissan.

TagMan

tagman · May 2006

Again, I disagree with you. I think you will ABSOLUTELY see a Supra-type car from Toyota in the future, regardless of the press or the FJ Cruiser. I'll go on record as saying so.

Also, as merc pointed out, there have been a lot of new cars coming out of Lexus recently. And, IMO, VERY needed and timely. And MORE needs to be done (SC coupe for example). But I think that Lexus would be foolish to let the high-end SUV market go to the others. I would expect a vastly improved ultra luxury SUV from them in the near future.

TagMan

Karen_S · May 2006

A reporter would like to talk with current and former Jaguar owners. Please respond to jfallon@edmunds.com no later than Friday, May 26, 2006 with your daytime contact info and a few words about your ownership experience.

Thanks,
Jeannine Fallon
Corporate Communications
Edmunds.com

killerbunny · May 2006

So... after 16 years of failure, what do you think will convince people to buy an Infiniti flagship?

Price.

Assuming I have got the money to spare, I will consider Q45, only if it's 25% cheaper than the LS460 and still possesses the same level of contents. Basically, that's what the LS did to the S-class.

killerbunny · May 2006

Sorry, Doc, I truly do believe that to move Lexus even faster than they are already moving would be "hazardous to their health".

Gotta agree with tagman here.

Lexus is not under-priced. MB is over-priced. The pricing of the next LS should not be focused on the S-class. Instead, Lexus should consider the purchasing power of the marketing and cost cutting through better technology and management.

If Lexus keeps on delivering good cars at a justified price, then MB has but only two options:
1) lower it's price and compete head on
2) raise it's price and follow the steps of Rolls Royce

P.S. I sure hope Lexus build cars in China. In that way, we may buy an ES350 at $25000 or an LS460 at $50000. And yeah, kill the competition.

stevekilburn · May 2006

In order to succeed in HELM Infiniti will have to radically reinvent its flagship with

1. Cutting edge technology
2. Drop-dead Sleek and Sexy design (much like aston martin rapide)
3. Powerful and fuel efficient V8 and may be V10, V12 engines.
3'. Rich and sophisticated interior with beautiful craftsmanship.
4. Maybe a 5% discount over Audi A8, if that.
5. A strong emphasis on Reliability, at top or near Lexus.

Offering cut-rate pricing as suggested with a HUGE 25% DISCOUNT OVER LS 460, let alone S550 is not going to help at all. it will be equivalent to committing suicide.

Remember guys, lowering the price tag in HELM arena doesnt work.

docnukem · May 2006

Offering cut-rate pricing as suggested with a HUGE 25% DISCOUNT OVER LS 460, let alone S550 is not going to help at all. it will be equivalent to committing suicide.

Remember guys, lowering the price tag in HELM arena doesnt work

It may have been a horse when it started out, but one sure wouldn't be able to tell now with all the beating. I can tell you it's dead, though.

stevekilburn · May 2006

You are presuming that S-class is under a price pressure from lexus. That is not true at all. Instead, at $87K a massive 43% more expensive than LS 430, S-class has cleverly re-positioned itself as the top end of the HELM market.

There is no such option A or B to lower or raise its price. Its all RUBBISH.

The german strategy is this:

If the competitor (read Lexus) under-cuts you, YOU MERELY RE-POSITION yourself as the TOP-END of that segment with your competitor being the TAIL-END.

In terms of volumes, the tail end might have a SLIGHT advantage, but the TOP-END guy more than makes-up for it with higher MSRP.

$90K X 22K units = 1.98 Billion dollars (S-class)
$60K X 28K units = 1.68 billion dollars (LS). Who wins?

This price-pressure thing is a MYTH, believed only by those who are not analyzing the situation correctly.

pat · May 2006

Is it ALL about money?

I have never thought so ...

stevekilburn · May 2006

Honestly I have no desire to beat dead horses or to engage in lengthy price and value based discussions, but when I see so many irrational opinions I am driven by the desire to explain the situation as it is using common-sense and sound analysis. Remember, its not a bad-idea to use common-sense.

syswei · May 2006

Steve,

You simply haven't demonstrated that Lexus would increase its profits if it increased prices to the level that you want. You have no firm idea what the price elasticity of demand is. You have no firm idea of what their incremental margins are. You are simply assuming that they are pricing below the profit-maximizing level. You don't in fact know, or even have a reasonable basis for assuming, and no amount of bolded type is going to convince anyone who has had even a modest exposure to economics that you do know. I think you should just let this issue rest. If it will make you feel better, write a letter to Lexus corporate.

hpowders · May 2006

It's great that we have one rational opinion here but, uh.... it belongs to syswei.

Sorry, Steve.

drfill · May 2006

Welcome to America. It is mostly about money. Not how you got, but how much you can git (and spend)!

Tag

You seem to have misread my post.

I clearly stated that Toyota plans a 2000GT-successor, in 4.5-5L V8 form, in the coming years. But the legend that was Supra is retired.

Haven't seen many websites/forums dedicated to reliving Toyota's 60's glory.

Nissan has made the Z work because they gave it the right engine, at the right price, at a time when Toyota and Honda had deserted the enthusiast.

And 7 SUVs to 0 sports cars makes no business sense. Explain it to me. Toyota's efforts haven't even been half-hearted since 1998.

DrFill

ljflx · May 2006

Syswei - excellent points. On top of all that our friend Steve keeps posting as if the cars are equally equipped. A 90K S-class has a longer wheel base, an air suspension, a 100 more horses and a bunch of other items that a $60K LS lacks, not to mention that it is a new car vs a car at the end of it's life cycle in 2006. This is not apples to apples as Steve keeps trying to illogically imply. In the years leading up to the redesign the S-class had a $77-87K sticker (and that $77K S430 is comparable to a $72K LS ultra, so we are dealing with a difference that is much lower than Steve implies, and on a shorter wheel base car). But the deals to be had were nowhere near that $77-87K MSRP and MB threw in free AWD to boot for the simple reason that its cars were at the end of their life cycle. Finally Steve needs to learn that incrementally higher prices do not translate to the same profit differences or any profit differences in some cases. As has been stated for so long now Lexus has a much lower build costs than MB and significantly lower build costs than it's other German competition. To not use that as a major pricing advantage - particularly for a rising company that is all of 16 years old - would be blatanly dumb.

drfill · May 2006

Pricing a car, like the next LS LWB, for $25k less than a similar car, like the S550, would be equally dumb.

That's no way to grow a brand's prestige/image.

If Mercedes can sell 3k S550 a month, and I think they will for the rest of this year, there is plenty of room for Lexus to move up, at least into the $70k class.

DrFill

tagman · May 2006

You seem to have misread my post.

I clearly stated that Toyota plans a 2000GT-successor, in 4.5-5L V8 form, in the coming years. But the legend that was Supra is retired.

Did I? Let's see in the coming years what Toyota does about a "sports coupe".

And 7 SUVs to 0 sports cars makes no business sense. Explain it to me.

OK, I'll explain it to you. The Japanese have a mixed success with sports cars, don't they? Gosh, the original Z was a smashing success only to become too fat. So the Mazda RX7 rekindled that fire, but only for a while cause they killed their own car as well. The Supra was a semi-lux sports cruiser, but never had the top notch handling it deserved. Honda could only come up with a Prelude, so there was NOTHING from then until the more recent S2000, which sells in small numbers. Mazda hit paydirt with the gutless but cute Miata, but ultimately never evolved the car. The Toyota MR2 project never had the proper corporate support. The NSX was one of the most revolutionary of all of the Japanese sports cars, but it barely sold. The replacement will likely be a V10 super sports car, but will it sell any better? The RX8 is goofy and the newest Nissan Z is still fat, although not bad looking. Nothing from Lexus at all, how 'bout that!

The SUV's were HOT HOT and it made enough business sense to capture the market. Interesting is the evolution within that segment. And it keeps changing. The little RAV4 is now bigger and more powerful and the Highlander will be replaced with a BIGGER one (maybe based on the new Camry). The FJ Cruiser is an unknown, because it was developed to compete with a vehicle that died during the FJ's development, namely the Hummer. It may possibly steal away ALL of that type of market and end up competing directly with Jeep. The Sequoia was hot until gas prices shot up because it is a gas-sucking V8 with seats that won't fold flat, but still a poor man's TLC. The 4-Runner is stuck in a time warp.

Basically, Toyota's SUV strategy is like this: "Circle the wagons . . . we'll surround 'em!"

You or I might not like the sports car to SUV ratio, but Toyota's bottom line sure does.

I do FINALLY (

)agree with you on something . . . that in spite of all of this, Toyota AND LEXUS still do need a genuine sports car that TRULY handles with the best of them, and has the LOOKS to go with it.

TagMan

tagman · May 2006

Pricing a car, like the next LS LWB, for $25k less than a similar car, like the S550, would be equally dumb.

So . . . the Mercedes sets the price standard for Lexus? Now THAT'S dumb.

You know, I would LOVE it. Because even at the "value" price of Lexus, Mercedes S-Class is the benchmark. Imagine just how many MORE S-Class cars Mercedes would sell if the Lexus were even closer to it in price.

Talk about dumb. Amazing how there are always a couple of posters that think THEY are even smarter than Lexus. And I hate to say it, but those corporate Lexus folks are pretty ------- smart!

TagMan

lexusguy · May 2006

Offering cut-rate pricing as suggested with a HUGE 25% DISCOUNT OVER LS 460, let alone S550 is not going to help at all. it will be equivalent to committing suicide."

While I dont agree with you about a new price strategy for the LS, I think you are correct about the Q45. The Q45 has always been much cheaper than the LS. It hasn't worked. Trying to undercut the LS by a huge margin just implies that the Q is inferior. The other major problem with the idea of a 25% cheaper than LS Q45 is that a fully loaded M45 Sport can hit $60K. That means the next Q will probably range $65-70K.

The M doesn't really undercut the GS in price at all, and yet its been a huge hit for Infiniti. "Go where the big guys aren't". Lexus doesn't really offer a viable 5 series alternative, and so the M can take that space. For the Q to succeed, it has to be able to go head-to-head with the 750, and not the LS.

merc1 · May 2006

Something tells me we're either going to see a stunner for the next Q or nothing at all with the current car just going on as long as it can. I don't think Nissan will spend the money on a new Q unless they can truly make it major threat to the class and something tells me they've given up on such a car in the face of the new LS, A8 and S-Class. A bigger M45 isn't going to cut it in the HELM class IMO.

M

lexusguy · May 2006

You've got a good point there. Nissan has several products that are going to need total redesigns soon, and Infiniti sales are basically made up of G, M, FX.

Instead of killing themselves making what may end up being the next Phaeton, why not devote resources instead to an X3\RDX competitor, a convertible, or perhaps a car smaller than G35 (A3 killer?) Any of those could easily work for them.

merc1 · May 2006

Instead of killing themselves making what may end up being the next Phaeton, why not devote resources instead to an X3\RDX competitor, a convertible, or perhaps a car smaller than G35 (A3 killer?) Any of those could easily work for them.

I agree or a larger coupe/convertible based on the M35/45 to tackle the 6-Series. The strange thing is that the Q recently got a "facelift" and nobody noticed. There wasn't a single roadtest of the car by any of the mainstream publications, talk about being ignored!

Funny you should mention the Phaeton....its been a semi-hit in Korea of all places. VW has managed to sell 1K in just one year of it being on sale in that market. I guess they care less about which badge is on the hood.

M

lexusguy · May 2006

Nothing was done to the Q for '05 to really justify a roadtest. Just about all of the changes were minor styling tweaks. From newcartestdrive:

"It looks more aggressive than before, with new front and rear fascia, a restyled hood and grille, a new headlight design with integrated fog lights, a restyled rear deck, new LED tail lights, and new chrome trim."

Other than that, they made slight changes to the transmission, redesigned the seats, and made the center stack slightly less cheap and ugly looking.

I'm not really sure why they even bothered. The car is more of an embarrassment at this point than anything else. I would just kill it off, not throw band-aids at it.

merc1 · May 2006

I'm not really sure why they even bothered. The car is more of an embarrassment at this point than anything else. I would just kill it off, not throw band-aids at it.

Agreed. I wonder if they're just keeping it around so they'll at least have a placeholder of some sorts for the next generation? Nah maybe not since the Q is likely in the top 10 rarest sedans in the America! It really doesn't have much of a market postion. The first generation M45 did better than this I think.

M

drfill · May 2006

As I've said before, Lexus is at a crossroads, in particular with the LS. Didn't say Lexus IS DUMB, or has been dumb.

If they access the market as it is now, as opposed to looking at it as if it is 1993, they will see the market is ready for Lexus to move up. Especially the LS.

I think they have found this out, but I will take it as a sign of fear if it costs less than A8/7-series.

The S-Class has always been the standard lexus has judged themselves against. So it is time to show and prove!

The S-Class isn't overpriced because sales have virtually doubled, without the new LS to check it.

A $70k start price will not affect sales numbers much, but will increases profit margins greatly, along with the brands image.

And THEN the S will seem overpriced.

DrFill

drfill · May 2006

Here's my accessment:

The G35 works. Keeping the manual. Over 300HP this fall. I like the upgrades inside, and the coupes lines due next Spring.

The FX is a great, edgy design, but it is not very space-efficient. Not good for families. Everytime I see one, a single male is driving it. I would deem it successful, but it is niche vehicle, unable to play in the RX330's sandbox. It will need to get bigger inside, and gain a less BMW interior, to have mass appeal.

OR MOVE IT SLIGHTLY DOWNMARKET! Make it a true step up from the X3-class, price it from $34k-49k, and build a larger Lexus HPX-type performance crossover in the $49k-$59k range. For the price of an X5, you get an X5 that legitimately seats 7! That would be a bold stroke!

The Q is dead. Time for a new name. If Lexus does the right thing and moves upmarket, the Q can take it's spot and it will have better sales because of that move.

They will have to show some creativity here, and some marketing savvy. They can go in any direction, but quitting on the brand above the M shows the customer you can't/won't compete, and that's worse than building something the market didn't want (Acura RL).

The QX almost works for me, and has done alright in sales (better than the Q). Not in love with the styling, but has a great engine and size. The interior needs an upgrade, still too much Nissan inside, and I'd clean up with a strong facelift. It has too much Armada in it, and they haven't learned the art of the rebadge like Toyota has. It needs to look more original, and smooth out the rough edges.

The M seems to be doing it's part, but has a lot of 3rd-world ugly to my eyes. Nothing wrong here a facelift can't fix.

I'd move the FX upmarket slightly, to be a more direct competitor to the X5, then build a more mainstream, larger, SUV under it.

If I were Infiniti, I'd target the 7-series, and make a 400HP sports sedan, make it as edgy and performance- oriented as you can, and sell against the 750 at a $15k discount. If you can make a truly sexy large sedan, with a new name, you've got a shot. But be aggressive, that's been your credo, and it works, more or less.

And the company that did the 2004 FX ad campaign, get them to do ALL of your product ads! One of Infinit's main weaknesses has always been advertising. ELIMINATE THAT WEAKNESS! Infinit has to sell an idea, an image much more than any other luxury company, because the public doesn't really know what Infinit is, much less wants to be!

Be the Japanese BMW you want to be!

DrFill

syswei · May 2006

WSJ article (for online subscribers)

Compares a Toyota factory in TX to a GM factory in TX. Each can produce 200k vehicles per year. Toyota takes 2.2 million sq ft, GM 3.75 million. Toyota labor cost per vehicle $800, vs GM $1800.

jrock65 · May 2006

"The FX is a great, edgy design, but it is not very space-efficient. Not good for families. Everytime I see one, a single male is driving it. I would deem it successful, but it is niche vehicle, unable to play in the RX330's sandbox. It will need to get bigger inside, and gain a less BMW interior, to have mass appeal."

Agree with your points. But the point of the FX is that you don't want it to have mass appeal. You don't want it to play in the RX's sandbox. That's why I say that Infiniti is a flagship away from Lexus status. They do fine in the segments that they are in, except the flagship class.

Infiniti doesn't need to compete with the "volume" ES and RX to be seen in the same status. These 2 vehicles make up almost 60% of Lexus sales. And we all know that high sales don't necessarily equal prestige.

My feeling is that Infiniti needs to do something real special for the next Q. No one can out-lux a Lex, so benchmarking the LS is out.

And I wouldn't target the 7 series either. What I'd do if I were Infiniti would be to target and market a "poor man's" Aston Martin sedan. Svelte, revolutionary styling is key.

ljflx · May 2006

The LWB car will range from $68K to $80K based on what I was told with most configurations in the $74-75K range. Does that do it for you? The hybrid will be $10K more in most configurations and range to $100K - supposedly - though I would think that strong demand for that car may effect market prices. Does that do it for you?? These are quantum jumps for Lexus vs the current car. I guess you could argue that Lexus has added a lot more to the car but guess what - MB has brought a lot more to the table with the S (as has/will everyone else) and hasn't raised prices at all. The incremental cost to add many of these new features is nominal - unless - it doesn't work right as then it shows up in truly incremental warranty repairs. The costs of much of the added features is easily offset, sometimes entirely and sometimes more than entirely with increased efficiencies. But if warranty costs pop up then thst is a real incremental cost paid to dealer repair men.

Finally all this price nonsense is a joke. Lexus will do the smart thing and price vs their build costs inflated by what their market research shows the market will bear. In the latter they have an advantage as they have a lot more room to inflate prices vs their competition. But the smart move is to do that in measured steps rather than all at once. Imagine what would have happened to the US and world economies if the Fed moved its rates uo 4% in one shot vs in 20 or so measured steps.

The S-Class isn't overpriced because sales have virtually doubled, without the new LS to check it.

This cannot be determined by initial sales. The real determination will be made in the ensuing years when pent-up demand slackens and competition increases. This is the case for all cars. Lexus will probably have stunning sales numbers for 6 months but the real issue of pricing success will be a year later. Same for MB with the S and all other cars that follow these two.

ljflx · May 2006

Will be interesting to see what everyone else does.

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BA47EE9B5%2D71D4%2D4E06%- 2D8F3A%2D4B608FA52919%7D&siteid=mktw&dist=

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