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    Thread: Lexus hasn't made a profit in 2 years...

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      09-09-2019 10:21 AM #76
      Quote Originally Posted by 6cylVWguy View Post
      I will have to disagree with your definition. Certainly something like a Corvette that you mentioned is a fantastic example. I don;t know much about the relationship between toyota V8s, but it the V8s from the Tundra/Sequioa are in lexus cars, that's also a good example.

      Having said that, you can make any engine sing with the right parts, so the fact that something could have been designed primarily for a BOF truck platform doesn't mean it can't be partially rengineered for a performance purpose. At the end of the day, all ICEs are just air pumps anyway.
      Exactly. I think of platforms the same way. Doesn't matter how new or old the components are or where they come from, as long as they work to make something that's fun to drive.

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    3. Member GeoffD's Avatar
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      09-09-2019 10:27 AM #77
      Quote Originally Posted by CTK View Post
      Exactly. I think of platforms the same way. Doesn't matter how new or old the components are or where they come from, as long as they work to make something that's fun to drive.
      What's "fun to drive" doing in a Lexus thread? The point of a Lexus is to totally isolate you from the road. Their highest volume models aren't anything resembling fun to drive.

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      09-09-2019 10:28 AM #78
      Quote Originally Posted by TetsuoShima View Post
      I was always bummed out that Lexus never offered a manual in their IS or RC cars.
      They did on the is250 back in the day. it was pretty garbo, and paired with the dog of an engine that was the 250 it really felt low rent. I'm not surprised the take rate could be measured with a micrometer.

      Quote Originally Posted by CTK View Post
      Admittedly being loose with the definition of "truck". If the engine is shared with a crossover it's the same to me. Your M3 was prob the last car in this class with a true bespoke standalone motor.
      I think with AMG it's "omg they put this badass motor in a suburban soccer mom-mobile" not the other way around. otherwise I largely agree with your rebuttal. Also, you forgot the viper

      lexus beefed it a bit with their 200t powertrain, but otherwise I stand by my assertion that all they really need is good tech and they'd sell better (again, this is accepting the premise that they're actually not profitable/losing money).

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      09-09-2019 10:30 AM #79
      Quote Originally Posted by CTK View Post
      Don't confuse your hopes and dreams with realistic projections. Sportback sedans are about as niche as it gets. The Arteon came out with money on the hood
      While that guy's crossover comments make no sense and I know it gets you excited for VW to discount a delayed product that was always going to be discounted anyway, the global sales and margin performance of products like the 4er gran Coupe, 6er Gran Coupe, A7/S7/RS7, Panamera, and 1.5 generations of the A5 SB say that sportbacks are not "about as niche as it gets". There are plenty of product categories that sell less and make less money for their companies. It is an iconic design style that has birthed aspirational products that strengthen brands.

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      09-09-2019 10:33 AM #80
      We would have had an IS and LS in our driveway if the Lexus infotainment system wasn't such a travesty. As for their sales problems, all sedans are down and the LS went too sporty for its target market. Their SUVs are long in the tooth and Acura is putting a lot of heat on everyone in the SUV market with the new (excellent) RDX and soon to be released MDX.

      Lexus needs to get back to their core values of exceptional attention to detail, incredible customer service and embracing their Japanese-ness. They recognize this and the new ES is a signal of their return to form.

      To address the crazy conspiracy poster who insists Japan is doomed and a shell, the majority of Japan's sovereign debt is actually held by its citizens. It's a legacy of the 1989 bubble collapse when the government had to throw tonnes of money at privately held insurance and banking firms to bail them out. They then had to consolidate and eventually nationalize them. The second largest holder is the US, which is a symbiotic relationship as Japan at times the largest or second largest holder of US debt.

      The Japanese government has also been hit by misfortune after misfortune and had to introduce huge fiscal packages due to the 2008 US meltdown and the 2011 earthquake. Unlike the US, the Japanese government doesn't leave its citizens destitute after a financial or natural disaster and has spend handsomely to re-build people's lives. Lastly, there was a stimulus bill introduced in 2015 to soften the increase in the consumption tax. All of this will soften over time as higher taxes and returns on Japan's foreign lending allows them to pay off more of their debt.

      The biggest threat to Japan is their ageing population, which hampers their ability to expand the economy (and thus the tax base). In the long-run, unless Japan drastically changes its immigration stance, they are going to become dependent on foreign capital.
      Last edited by unhappymeal; 09-09-2019 at 10:51 AM.

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      09-09-2019 11:28 AM #81
      Quote Originally Posted by GeoffD View Post
      Quote Originally Posted by CTK View Post
      Exactly. I think of platforms the same way. Doesn't matter how new or old the components are or where they come from, as long as they work to make something that's fun to drive.
      What's "fun to drive" doing in a Lexus thread? The point of a Lexus is to totally isolate you from the road. Their highest volume models aren't anything resembling fun to drive.
      Again, the same could be said of any volume luxury player's top selling models. What's your point? Or do you not have one?

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      09-09-2019 11:31 AM #82
      Quote Originally Posted by JackStraw79 View Post
      Quote Originally Posted by CTK View Post
      Don't confuse your hopes and dreams with realistic projections. Sportback sedans are about as niche as it gets. The Arteon came out with money on the hood
      While that guy's crossover comments make no sense and I know it gets you excited for VW to discount a delayed product that was always going to be discounted anyway, the global sales and margin performance of products like the 4er gran Coupe, 6er Gran Coupe, A7/S7/RS7, Panamera, and 1.5 generations of the A5 SB say that sportbacks are not "about as niche as it gets". There are plenty of product categories that sell less and make less money for their companies. It is an iconic design style that has birthed aspirational products that strengthen brands.
      I wasn't saying sportbacks shouldn't exist, just that the idea that they will replace crossovers is ridiculous. And I stand by that

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      09-09-2019 11:54 AM #83
      Quote Originally Posted by VigorousZX View Post
      Not enough Japanese workers? How is that possible for a country with 150 million?

      Can you tell me how much it takes to produce a Lexus LC-500? Were the stamping sheet metal molds of the design millions of dollars to produce? At the end of the day you dont what costs what without seeing the books, that includes what Toyota has to pay in tax and loan interests.

      And what are these regulations... produce over 100k cars of a model and they have to all be stubby and appliance like?
      Look at any demographic article about Japan - it is in a crises. Negative population growth, severe young worker shortage, and large numbers of Japanese women are not having children because the country is very sexist when it comes to mothers - its basically career suicide. The general aversion to foreigners means Japan will never have much immigration. So the nation is in trouble. You can lump Russia into this predicament as well. These are two nations facing serious population problem that cannot reasonably be fixed.

      Many first world nations (France, Germany, etc...) have low birthrates, but are buoyed by strong immigration (same as the US) but Japan will never be an immigrant friendly place - Asia is and remains very hostile to Japan for it's abhorrent actions during the 20th century. As an aside, in Europe the specter of Soviet domination of W. Europe made the Europeans quickly sweep the German question under the rug as one bad actor was immediately replaced with a potentially much bigger and worse actor - the Soviet Union. From suspicion and fear of Germany - the main question that had haunted Europe since the Franco-Prussian war of 1870, the ancient threat of W. Europe - Russia - was fully realized by 1945, when the end stages of the war were simply trying to keep as much of Germany out of Russian hands as possible.

      That never happened in Asia, so Japan's 20th century legacy remains a sticking point (and sadly, deservedly so).

      The regs referenced earlier relate to things like bumper height for pedestrians, and safety things that (while necessary) affect how much leeway designers have in creating a car's look.

      https://www.npr.org/2018/12/21/67910...-rapid-decline

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      09-09-2019 01:17 PM #84
      Quote Originally Posted by CTK View Post
      Again, the same could be said of any volume luxury player's top selling models. What's your point? Or do you not have one?
      Lexus has the 2nd oldest demographic behind Caddy and the highest percentage of women buyers. Using "fun to drive" as a metric in a Lexus thread kind of pegs the irony meter. That's not the target market. It's the car for affluent 50-somethings who value reliability and ride comfort over pretty much anything else. That was my point. The Europeans have targeted the "fun to drive" segment. That's not where Lexus lives and this is a Lexus thread.

      And me? No. My car winters outdoors in Vermont. I drive an appliance that does well in winter driving where I don't need to care about road salt destroying it. If I want engaging, I ski the trees. I squander my discretionary money on things other than cars. We all make our choices.

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      09-09-2019 01:19 PM #85
      Quote Originally Posted by downytide View Post
      I honestly couldn't tell that wasn't the LS until I saw the rear badge.

      Damn.
      For real... they've done a stellar job on the ES. Looks fantastic.
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      09-09-2019 01:28 PM #86
      Quote Originally Posted by Lawrider View Post
      Many first world nations (France, Germany, etc...) have low birthrates, but are buoyed by strong immigration (same as the US) but Japan will never be an immigrant friendly place - Asia is and remains very hostile to Japan for it's abhorrent actions during the 20th century. As an aside, in Europe the specter of Soviet domination of W. Europe made the Europeans quickly sweep the German question under the rug as one bad actor was immediately replaced with a potentially much bigger and worse actor - the Soviet Union. From suspicion and fear of Germany - the main question that had haunted Europe since the Franco-Prussian war of 1870, the ancient threat of W. Europe - Russia - was fully realized by 1945, when the end stages of the war were simply trying to keep as much of Germany out of Russian hands as possible.

      That never happened in Asia, so Japan's 20th century legacy remains a sticking point (and sadly, deservedly so).
      I thought the Germans bombed Pearl Harbor?

      South Korea is aging even faster than Japan. The tax structure in those countries 20 years from now to prop up all the elderly is going to crush them. It will be really hard to manufacture high labor content products like automobiles there. It's not just labor shortage.

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      09-09-2019 02:14 PM #87
      Quote Originally Posted by GeoffD View Post
      I thought the Germans bombed Pearl Harbor?

      South Korea is aging even faster than Japan. The tax structure in those countries 20 years from now to prop up all the elderly is going to crush them. It will be really hard to manufacture high labor content products like automobiles there. It's not just labor shortage.
      Yup. That's why I mentioned in the long-run they will either have to liberalize their immigration policies or liberalize capital flows and corporate governance. Japan cannot insulate themselves from foreign capital markets or immigration forever.

    14. 09-09-2019 02:19 PM #88
      Quote Originally Posted by Lawrider View Post
      Look at any demographic article about Japan - it is in a crises. Negative population growth, severe young worker shortage, and large numbers of Japanese women are not having children because the country is very sexist when it comes to mothers - its basically career suicide. The general aversion to foreigners means Japan will never have much immigration. So the nation is in trouble. You can lump Russia into this predicament as well. These are two nations facing serious population problem that cannot reasonably be fixed.

      Many first world nations (France, Germany, etc...) have low birthrates, but are buoyed by strong immigration (same as the US) but Japan will never be an immigrant friendly place - Asia is and remains very hostile to Japan for it's abhorrent actions during the 20th century. As an aside, in Europe the specter of Soviet domination of W. Europe made the Europeans quickly sweep the German question under the rug as one bad actor was immediately replaced with a potentially much bigger and worse actor - the Soviet Union. From suspicion and fear of Germany - the main question that had haunted Europe since the Franco-Prussian war of 1870, the ancient threat of W. Europe - Russia - was fully realized by 1945, when the end stages of the war were simply trying to keep as much of Germany out of Russian hands as possible.

      That never happened in Asia, so Japan's 20th century legacy remains a sticking point (and sadly, deservedly so).

      The regs referenced earlier relate to things like bumper height for pedestrians, and safety things that (while necessary) affect how much leeway designers have in creating a car's look.

      https://www.npr.org/2018/12/21/67910...-rapid-decline
      The 'British' have invaded 90% of the world.
      https://i.imgur.com/h93l2qk.jpg

      Would it be impossible to say that Japan's power structure was overthrown before the 1900's?
      https://i.imgur.com/KG1lcFB.jpg

      How about the Bolshevik leaders, they were trained in New York and funded in the billions by elite banker Jacob Schiff who also financed the Japanese to fight Russia prior.

      History is very twisted... we can not take 'western' accounts as facts.

      That being said I believe Japan is still a shell state made to serve the western empire. Labour shortage or not, I think its a shortage of Japaneses who are not poor enough to work hard factory demands.

      In reality how does Toyota sell such a popular world wide product but yet need money to stay afloat? Because its a puppet company like all other major car companies.

      March 2009

      Toyota seeks $2bn crisis loan



      July 2019
      Toyota to raise $1.5B in debt offering
      Toyota Motor Corp. is seeking to raise $1.5 billion of debt, according to a prospectus filed June 25.
      ..
      J.P. Morgan Securities LLC, BofA Securities Inc. and BNP Paribas Securities Corp. are acting as joint book-runners for the offering.
      I also think the so called safety regulations are mostly an excuse to keep ugly cars on the road and make the consumer pay a high premium for good design.
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      09-09-2019 02:30 PM #89
      Quote Originally Posted by GeoffD View Post
      Lexus has the 2nd oldest demographic behind Caddy and the highest percentage of women buyers. Using "fun to drive" as a metric in a Lexus thread kind of pegs the irony meter. That's not the target market. It's the car for affluent 50-somethings who value reliability and ride comfort over pretty much anything else. That was my point. The Europeans have targeted the "fun to drive" segment. That's not where Lexus lives and this is a Lexus thread.

      And me? No. My car winters outdoors in Vermont. I drive an appliance that does well in winter driving where I don't need to care about road salt destroying it. If I want engaging, I ski the trees. I squander my discretionary money on things other than cars. We all make our choices.
      We were talking about the RC F FWIW the bulk of the rest of luxury brand lineups are not fun to drive either... like Lexus they specialize in luxury, not driving fun

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      09-09-2019 02:32 PM #90
      Quote Originally Posted by GeoffD View Post
      Lexus has the 2nd oldest demographic behind Caddy and the highest percentage of women buyers. Using "fun to drive" as a metric in a Lexus thread kind of pegs the irony meter. That's not the target market. It's the car for affluent 50-somethings who value reliability and ride comfort over pretty much anything else. That was my point. The Europeans have targeted the "fun to drive" segment. That's not where Lexus lives and this is a Lexus thread.

      And me? No. My car winters outdoors in Vermont. I drive an appliance that does well in winter driving where I don't need to care about road salt destroying it. If I want engaging, I ski the trees. I squander my discretionary money on things other than cars. We all make our choices.
      We were talking about the RC F FWIW the bulk of the rest of luxury brand lineups are not fun to drive either... like Lexus they specialize in luxury, not driving fun

      Plus I wouldn't be surprised if brand age were tied to pricing to some degree. The Germans keep pushing further and further downmarket which would lower the average buying age. Doesn't exactly mean a CLA is "fun to drive"

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      09-09-2019 02:45 PM #91
      I think the problem with Lexus and why they are not profitable is because they have all these dead weights. Pare back the model offering and just focus on what matters:

      Two sedan:ES and LS
      Four SVUs: UX (but make it suck less), NX, RX, and LX.

      Drop: IS, GS, RC, LC, GX

      Hybrid everything so it is standard powertrain on all the models. Making your customer pay extra for "h" on a Lexus is like Subaru making people pay extra for AWD... yes, in theory you can do it but why?

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      09-09-2019 03:40 PM #92
      I don't believe this BS, if Lexus hasn't made a profit in 2 years then Acura should already gone bankrupt.
      Last edited by Avus; 09-09-2019 at 07:40 PM.
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      09-09-2019 04:19 PM #93
      Quote Originally Posted by AeroWagon View Post
      Have not agreed with their "make it sporty and luxurious" approach, I think they should have just kept cranking out silent, wafting, comfortable vehicle instead of trying to go after the germans [sic] and their autobahn pedigrees.
      I believe Lexus made (is making) the same mistake as Cadillac. They've hitched their wagon to the wrong horse.

      This is why Lincoln is becoming quite relevant and Cadillac is struggling with identity. Having its house moved twice in the last five years probably hasn't helped Cadillac, either.

      Cadillac, like Lexus, seems to be trying to shoot for the luxurious sport segment - something others already do extremely well (and, as a result, have quite the lock on the segment).

      Lincoln, on the other hand, realized that what it does well is embrace unapologetic American Luxury combined with some serious grunt under the hood. The 2019 Nautilus I've had the extreme privilege of putting nearly 5,000 miles on since May bears that out. In Comfort mode, the thing actually floats a little. But, put the hammer down and the 2.7 pulls (especially when you're feeding it Premium unleaded). They know their role and do it well.

      Lexus and Cadillac need to do some soul-searching and get back to what made them great in the first place.
      Last edited by chrisj428; 09-12-2019 at 11:47 AM.
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      09-09-2019 04:26 PM #94
      Quote Originally Posted by chrisj428 View Post
      I believe Lexus made (is making) the same mistake as Cadillac. They've hitched their wagon to the wrong horse.

      This is why Lincoln is becoming quite relevant and Cadillac is struggling with identity. Having its house moved twice in the last five years probably hasn't helped Cadillac, either.

      Cadillac, like Lexus, seems to be trying to shoot for the luxurious sport segment - something others already do extremely well (and, as a result, have quite the lock on the segment).

      Lincoln, on the other hand, realized that what it does well is embrace unapologetic American Luxury combined with some serious grunt under the hood. The 2019 Aviator I've had the extreme privilege of putting nearly 5,000 miles on since May bears that out. In Comfort mode, the thing actually floats a little. But, put the hammer down and the 2.7 pulls (especially when you're feeding it Premium unleaded). They know their role and do it well.

      Lexus and Cadillac need to do some soul-searching and get back to what made them great in the first place.
      Can't speak to Caddy, but what made Lexus great is increasingly irrelevant.

      It used to be Lexus was a Mercedes that A) cost 60% of what a Mercedes cost and B) was super reliable, unlike the Mercedes.

      These days, MB prices have gone down and Lexus prices have gone up, and, increasingly, we are in a lease-only society so no one cares what the cost is, nor do they care about long term reliability. Plus, the Germans have gotten their act together, so at least for the first lease term, a MB is give or take as reliable as a Lexus anyways.


      Couple all that with the hideous Lexus grille and the fact that MB is moving styling and tech forward and Lexus is treading water, and lights out for Lexus.
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      09-09-2019 04:51 PM #95
      Quote Originally Posted by Avus View Post
      I don't believe this BS, if Lexus hasn't made a profit in 2 years then Acura should already gone bankrupt already.
      Just wanted to point out that not making a profit doesn't mean the bleeding money at some insane amount; they could also just be breaking even. They also obviously have a parent company that could absorb a loss *if* that's in fact happening. That's how we still have Jaguar.
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      09-09-2019 04:52 PM #96
      Quote Originally Posted by chrisj428 View Post
      This is why Lincoln is becoming quite relevant and Cadillac is struggling with identity. Having its house moved twice in the last five years probably hasn't helped Cadillac, either.
      You might like what Lincoln is putting out, but it's no more relevant today than it was 5 years ago. Does anyone buy a lincoln? Anyone under 75 who's really just a Ford person? They have what, 2, maybe 1 SUV that's interesting? The only reason why Cadillac is lost is because management has no direction for the brand. As we all know, the product is excellent.

      Cadillac, like Lexus, seems to be trying to shoot for the luxurious sport segment - something others already do extremely well (and, as a result, have quite the lock on the segment).
      I kind of wonder what experience you have behind the wheel of a lexus product to make these conclusions about Lexus. I have not driven a current Lexus so I will not comment, but just because the styling (LS, ES in particular) is a bit more adventurous doesn't mean that the brand is trying to become a canyon carver. The IS and GS have always been a bit more on the sporty side. If you buy a regular, non-F version of the LS, I would have a hard time believing it's anything other than pillow smooth. As an aside, I drove a previous LS back to back with the previous 7 series and you could definitely tell the difference between the two. IMO, the BMW was WAY too sporty for what it was. Although slower and much softer, I liked the LS quite a bit more. If I'm buying a full size luxury car, for me, comfort is paramount.

      The 2019 Aviator I've had the extreme privilege of putting nearly 5,000 miles on since May bears that out. In Comfort mode, the thing actually floats a little. But, put the hammer down and the 2.7 pulls (especially when you're feeding it Premium unleaded). They know their role and do it well. Lexus and Cadillac need to do some soul-searching and get back to what made them great in the first place.
      Stop, just stop. While I can respect and even appreciate that Lincoln is focusing more on comfort, they've been nothing other than warmed over Fords until, what, 3-4 yrs ago. Lincoln has a ton of work to do. Cadillac has been doing well at the sport-luxury thing, but what you're seeing isn't bad or even confused product, you're simply seeing management confusion about the ongoing direction of the brand.

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      09-09-2019 05:23 PM #97
      Cars are becoming commoditized. This was always the endgame as the tech from suppliers becomes more modular/plug-and-play and more evenly distributed. The future is in "transportation solutions", as people buy into a transportation service. The luxury manufacturers are responding by making their cars into ultra-techy lease-mobiles as a means to differentiate, but Lexus seems to be continuing to build their products with a more old-school mentality. They don't have anything competitive with the new X5, for instance, but I know which I'd rather own for the long-haul. Unfortunately, luxury buyers are all leasing these days so that advantage is moot.

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      09-09-2019 05:33 PM #98
      Quote Originally Posted by unhappymeal View Post
      Yup. That's why I mentioned in the long-run they will either have to liberalize their immigration policies or liberalize capital flows and corporate governance. Japan cannot insulate themselves from foreign capital markets or immigration forever.
      Nailed it quite well. One day they'll realize that they can't have their cake and eat it.

    25. 09-09-2019 07:55 PM #99
      Quote Originally Posted by TetsuoShima View Post
      I was always bummed out that Lexus never offered a manual in their IS or RC cars. I think it honestly would've eaten away sales from manual BMW's. Lexus' are known for being built really well, being pretty damn reliable and holding their value extremely well. You toss a manual in there, tweak the suspension/power settings here and there and you quickly wonder why someone would want a BMW that will plummet in value and most likely cause you headaches down the road.
      Aaah, the obligatory manual lover.

      Yes those 11 sales would eat into BMW 10 sales.



      Speaking of profits, are companies profits or losses all about strictly cars? Do they invest in other things? I worked in a company who made sure their every quarter was a "loss" for accounting purposes. The money just went elsewhere and was redistributed later. Looked bad on paper, but the company was thriving and owners were smiling wide.

    26. 09-09-2019 10:13 PM #100
      Quote Originally Posted by The_Real_Stack View Post
      Can't speak to Caddy, but what made Lexus great is increasingly irrelevant.

      It used to be Lexus was a Mercedes that A) cost 60% of what a Mercedes cost and B) was super reliable, unlike the Mercedes.

      These days, MB prices have gone down and Lexus prices have gone up, and, increasingly, we are in a lease-only society so no one cares what the cost is, nor do they care about long term reliability. Plus, the Germans have gotten their act together, so at least for the first lease term, a MB is give or take as reliable as a Lexus anyways.


      Couple all that with the hideous Lexus grille and the fact that MB is moving styling and tech forward and Lexus is treading water, and lights out for Lexus.
      Yes but Lexus carved success in segments MB was absent in, just as it started losing sales in more traditional segments. The ES for example is a uniquely Lexus product and the RX arguably invented its segment, and the hybrids were also a differentiator.

      I personally don't like MB much, I think their cars are pretty poor overall. They are designed-by-committee leased black taxis for the wealthy. There is definitely room for Lexus to be a more flamboyant version of MB with cars like the LC but the product execution in those segments has been half assed (minus the LC itself) and left to linger.

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