Lexus Unfazed by LS Decline as S Class, Model S Grow
07-04-14, 07:12 AM
#1
Lexus Unfazed by LS Decline as S Class, Model S Grow
Lexus Unfazed by LS Decline as S-Class, Tesla Model S Grow
WHISTLER, British Columbia – As Lexus LS sales founder this year under pressure from new entrants, the brand is not sweating the situation.
“We don’t feel it’s a problem with the car,” Brian Smith, vice president-marketing for Lexus in the U.S., tells WardsAuto here during a Lexus NX media event. “Many of the buyers in that segment want what’s new and they’re trying it.”
What’s new is the Mercedes-Benz S-Class, which is getting rave reviews and racking up the growth to show for them. S-Class sales rose 81.8% through May, to 6,381 units.
Sales of the LS, which was all-new in ’07 and last refreshed in ’13, were down in the same period, 19.7% to 2,149 units.
Smith also says the Tesla Model S is wooing buyers in the relatively small but influential Upper Luxury Car segment in the U.S.
“They’re right behind Mercedes in volume,” he says. WardsAuto estimates Model S sales tallied 4,600 units through May, down 6.2% from the same period year-ago.
Smith believes most S-Class sales are to brand loyalists who wait for a new generation of the sedan, but some LS buyers may be trying a Tesla.
“They’ll probably come back,” he says. “I think the question remains to be seen how many people will buy a second Tesla.”
As to whether the S-Class is a game-changer, as some in the auto industry are claiming, Smith believes the elements that make the Mercedes unique are not significant enough to sway LS buyers long-term.
“The things that I notice: the (pillow-like) headrests, the (scent) generator, the (LED interior) lighting, all that stuff is incremental improvements, but they’re certainly not game-changers,” he says, adding every entrant in the segment pretty much is now on even footing in terms of performance and handling and looking for ways to differentiate themselves.
When the refreshed LS debuted in ’13, Lexus executives expected the car’s segment to continue to see further decline, which this year hasn’t proved true.
Thanks to growth from the S-Class, as well as Audi’s A7 and the Porsche Panamera, WardsAuto Upper-Luxury Car sales rose 4.0% through May to 23,818 units.
However, in the LS’ launch year of 1990, Lexus sold 42,980 copies of the car.
Smaller luxury sedans, such as Lexus’ own ES and IS, continue to impact large-sedan sales, as does the growth in CUVs.
Smith believes the CUV trend is more of a result of product-cycle timing than a long-term shift by luxury buyers away from cars.
“As we get around to launching some new sedans, coupes, those kinds of products, it’s going to keep the car segment pretty strong,” he says.
WHISTLER, British Columbia – As Lexus LS sales founder this year under pressure from new entrants, the brand is not sweating the situation.
“We don’t feel it’s a problem with the car,” Brian Smith, vice president-marketing for Lexus in the U.S., tells WardsAuto here during a Lexus NX media event. “Many of the buyers in that segment want what’s new and they’re trying it.”
What’s new is the Mercedes-Benz S-Class, which is getting rave reviews and racking up the growth to show for them. S-Class sales rose 81.8% through May, to 6,381 units.
Sales of the LS, which was all-new in ’07 and last refreshed in ’13, were down in the same period, 19.7% to 2,149 units.
Smith also says the Tesla Model S is wooing buyers in the relatively small but influential Upper Luxury Car segment in the U.S.
“They’re right behind Mercedes in volume,” he says. WardsAuto estimates Model S sales tallied 4,600 units through May, down 6.2% from the same period year-ago.
Smith believes most S-Class sales are to brand loyalists who wait for a new generation of the sedan, but some LS buyers may be trying a Tesla.
“They’ll probably come back,” he says. “I think the question remains to be seen how many people will buy a second Tesla.”
As to whether the S-Class is a game-changer, as some in the auto industry are claiming, Smith believes the elements that make the Mercedes unique are not significant enough to sway LS buyers long-term.
“The things that I notice: the (pillow-like) headrests, the (scent) generator, the (LED interior) lighting, all that stuff is incremental improvements, but they’re certainly not game-changers,” he says, adding every entrant in the segment pretty much is now on even footing in terms of performance and handling and looking for ways to differentiate themselves.
When the refreshed LS debuted in ’13, Lexus executives expected the car’s segment to continue to see further decline, which this year hasn’t proved true.
Thanks to growth from the S-Class, as well as Audi’s A7 and the Porsche Panamera, WardsAuto Upper-Luxury Car sales rose 4.0% through May to 23,818 units.
However, in the LS’ launch year of 1990, Lexus sold 42,980 copies of the car.
Smaller luxury sedans, such as Lexus’ own ES and IS, continue to impact large-sedan sales, as does the growth in CUVs.
Smith believes the CUV trend is more of a result of product-cycle timing than a long-term shift by luxury buyers away from cars.
“As we get around to launching some new sedans, coupes, those kinds of products, it’s going to keep the car segment pretty strong,” he says.
With the brand new S Class out, and Model S being so well received, I am not particularly troubled by the drop off in LS sales this year. What does bother me is that if the rumors are to be believed, it won't be fully replaced until the 2017 model year.
Maybe Lexus is content to let the sales dwindle as they prepare for the new model, but I think it's going to start to tarnish the model's image if sales steadily drop to just a few hundred units a month over the next two years.
07-04-14, 07:57 AM
#2
Lexus Test Driver
Besides reliability and overall build quality, there is no other reason to get an LS at this point.
All of its main competitors are superior in power, driving dynamics, luxury features, and customization.
Sclass, 7series, A8, XJ
All of its main competitors are superior in power, driving dynamics, luxury features, and customization.
Sclass, 7series, A8, XJ
07-04-14, 08:52 AM
#4
Lexus Fanatic
I still love the current LS. I think it is a masterpiece in design, especially the incredible interior.
But, I have to admit when Lexus has faltered. The LS is sort of akin to the refreshed Tundra in the truck segment, it will appeal to the Toyota fans.
07-04-14, 11:47 AM
#5
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I agree. Now that the sales figures are starting to show, it appears Lexus did make a mistake with the refresh of the LS. Even though it does have 3000 different parts.
I still love the current LS. I think it is a masterpiece in design, especially the incredible interior.
But, I have to admit when Lexus has faltered. The LS is sort of akin to the refreshed Tundra in the truck segment, it will appeal to the Toyota fans.
I still love the current LS. I think it is a masterpiece in design, especially the incredible interior.
But, I have to admit when Lexus has faltered. The LS is sort of akin to the refreshed Tundra in the truck segment, it will appeal to the Toyota fans.
07-04-14, 12:31 PM
#6
2014 LS looks pretty damn good... the segment is dying - just because Ward Auto added Panamera and A7 and Tesla S to it, doesnt meant it is not dying.
I would think that a lot of Tesla S buyers would never consider car like LS or S class. IMHO Panamera and A7 are not exactly the same class.
As to competition being better, obviously MB is all new, but LS can easily hold its own vs A8 and 7 series, as the sales numbers show - it outsold them all YTD.
I would think that a lot of Tesla S buyers would never consider car like LS or S class. IMHO Panamera and A7 are not exactly the same class.
As to competition being better, obviously MB is all new, but LS can easily hold its own vs A8 and 7 series, as the sales numbers show - it outsold them all YTD.
07-04-14, 12:46 PM
#7
Instructor
We have bought two LS in the past. I guess you can call us loyal Lexus fans. We love the Lexus reliability and wanted very much to get the 2013 LS when it was launched in late 2012. However, I have to be honest with you guys, the current LS looks so hideous! We hardly see any new LS around town. We have leased two MB GL450 in the past years. When/If Lexus designs a classy and nice looking LS we will come back to the Lexus family. Until then, we are Lexus expatriates 
Last edited by BrickHead; 07-04-14 at 03:43 PM.
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07-04-14, 12:48 PM
#8
The pursuit of F
In extending the life out of the current gen with a 3000+ parts renewal in the '13 LS, this tells me one thing only. That Lexus is taking the necessary additional 3 years in perfecting the next gen LS.
MY '16 look out S-Class!
MY '16 look out S-Class!
07-04-14, 12:56 PM
#9
Lexus Fanatic
Originally Posted by LexsCTJill
But, I have to admit when Lexus has faltered. The LS is sort of akin to the refreshed Tundra in the truck segment, it will appeal to the Toyota fans.
The difference, though, was that it took Toyota some 15 years to finally get their T-100/150 and Tundra larger-truck series suitable for the American market. The LS, in comparison, was (and is) a superbly-done vehicle, going all the way back to Day One, in 1990, when it was first introduced.
07-04-14, 01:39 PM
#10
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If you judge Tesla soley as a vehicle, I think very few people would buy a second one. When I rented one the first time, I was blown away by the electric drivetrain, the pull, and the novel center display screen. When I rented it a second time, I noticed severe wind noise from the front window seals, pretty bad wear in places, and rattles from the trunk/rear seats. Insideline's long term Model S has been far from flawless, with a few issues regarding the drive unit. Sure the electric car is very novel but I think it would wear off quickly due to these quality issues.
Since the Lexus vice president seems unfazed and says the new S class doesn't have game changers, lets see what they bring to the table. A car like the S class doesn't really need to be a game changer. Sometimes, the small things and details are what make the vehicle. Things as simple as Magic vision control ( the wiper blades that have the laser drilled holes for window washer fluid build it) are what make the S class so great.
Since the Lexus vice president seems unfazed and says the new S class doesn't have game changers, lets see what they bring to the table. A car like the S class doesn't really need to be a game changer. Sometimes, the small things and details are what make the vehicle. Things as simple as Magic vision control ( the wiper blades that have the laser drilled holes for window washer fluid build it) are what make the S class so great.
Last edited by RXSF; 07-04-14 at 04:35 PM.
07-04-14, 02:09 PM
#11
Lexus Fanatic
If you judge Tesla soley as a vehicle, I think very few people who buy a second one. When I rented one the first time, I was blown away by the electric drivetrain, the pull, and the novel center display screen. When I rented it a second time, I noticed severe wind noise from the front window seals, pretty bad wear in places, and rattles from the trunk/rear seats. Insideline's long term Model S has been far from flawless, with a few issues regarding the drive unit. Sure the electric car is very novel but I think it would wear off quickly due to these quality issues.
Since the Lexus vice president seems unfazed and says the new S class doesn't have game changers, lets see what they bring to the table. A car like the S class doesn't really need to be a game changer. Sometimes, the small things and details are what make the vehicle. Things as simple as Magic vision control ( the wiper blades that have the laser drilled holes for window washer fluid build it) are what make the S class so great.
Since the Lexus vice president seems unfazed and says the new S class doesn't have game changers, lets see what they bring to the table. A car like the S class doesn't really need to be a game changer. Sometimes, the small things and details are what make the vehicle. Things as simple as Magic vision control ( the wiper blades that have the laser drilled holes for window washer fluid build it) are what make the S class so great.
07-04-14, 02:11 PM
#12
Lexus Fanatic
We have bought two LS in the past. I guess you can call us loyal Lexus fans. We love the Lexus reliability and wanted very much to get the 2013 LS when it was launched in late 2012. However, I have to be honest with you guys, the current LS looks so hideous! We hardly see any new LS around town. We have leased two MB GL450 in the past years. When/If Lexus redesigns a classy and nice looking LS we will get back in the Lexus family. Until then, we are Lexus expatriates
07-04-14, 03:46 PM
#13
Instructor
07-04-14, 06:28 PM
#14
Lexus Fanatic
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I would think that a lot of Tesla S buyers would never consider car like LS or S class.
as GREAT as the ls is, i still don't consider it in the same league as the s-class, and of course the ls is now old even with the extensive refresh.
IMHO Panamera and A7 are not exactly the same class.
i personally think a big comfy sedan just isn't that great because if you want to haul more than 2 people around in comfort a luxury suv is way better.
while this is a big step up from the older interior, there's several details i don't like. i REALLY don't like leather boots on auto shifters... they make no sense, look 'messy' to me, take up more room than necessary, and collect dust and dirt. the touch controller with 'arm rest' is HUUUUGE... takes up way too much center room. i'm sure things will be improved greatly with a new one though, and the LS ride is still wonderfully smooth and quiet.
07-04-14, 06:37 PM
#15
Lexus Fanatic
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edit, i did just find the the LS600hL DOES do away with the shifter leather boot... yay! that must be worth the $25k difference. 
that must be worth the $25k difference.