AUTO SPIES PERSPECTIVE: Could this innovative Lexus strategy be the magic bullet to kill the competition?

Lexus Chief Bob Carter



To all the Lexus ES naysayer’s criticizing it because it doesn’t perform as a BMW 550 or Mercedes E500, we say you’ve missed the whole point of this car AND its part in the master strategy of Lexus.

To make it clearer, not being in the same performance class as those cars is just fine for the new ES.

In case you don’t realize it, the ES is purely a luxury focused car aimed at an audience that the rest of the competition is ignoring.

BMW 3-series, 5-series, Mercedes E-Class, Infiniti M/G-class, Acura TL, Audi A4/A6-class, Lexus IS/GS-series.

All aimed at the demographic looking for extra ‘SPORT’ in their purchase…BMW being the MOST skewed toward the ‘Sport’ end of the spectrum.

Now let us pose the question to you.

Who in this competitive landscape is focusing on the customer who prefers more ‘LUXURY’ than sport?

And do you know how many customers there are in that segment who could care less how sporty the car is?



Let’s just say, there are A LOT of people who just want a reliable car that they don’t have to think about, dripping in luxury and comfort.

THAT, is the customer that Lexus built the ES for.

The customer that thinks the original Lexus LS is just fine for them, thank you very much, but don’t want to spend over 40k to get it.

Just look at the the specs on the new ES.

It’s basically a prettier, modernized LS400, with way more luxury features.



For those who say it’s not sporty enough for them, Lexus says that’s fine.

We have the IS and the GS for those customers.

Lexus has identified an opening that should end up being very lucrative for them because there is virtually no one left in this space.

Just like their strategy of three SUV’s that perform three different roles, the ES is part of a strategy of two offerings (Entry-Luxury) starting in the $30k price bracket.

One for the performance/sport crowd (IS/GS) and one for the luxury based clique (ES).

We think it’s a brilliant strategy that will end up confounding the competitors again.

And even though we’re not in the customer demographic for the ES, it’s a mighty fine car and it is MUCH better looking in real life than in the pics.

Year after year, Lexus keeps showing us they know the market better than anyone else.

More photos of this car are in our Chicago auto show gallery.

Click here to view the 2006 Chicago auto show gallery

Special thanks to Lexus for sponsoring the 2006 chicago auto show photo gallery!

nielsera1 - 2/11/2006 5:22:20 PM

+1 Boost

Bottom line, its still just a Lexus (Toyota).

DiamondJim - 2/11/2006 6:32:22 PM

+1 Boost

great essay.....

nielsera1 - 2/11/2006 7:14:58 PM

+1 Boost

You don’t get it....

There is prestige, status, stature, esteem....
that is achieved with owning/driving a luxury vehicle.

It is not realized in a Lexus (Toyota), Phaeton (VW), Cadillac(GM), Lincoln(Ford)......

There is more to a luxury vehicle than changing the fenders and the badging.

nielsera1 - 2/11/2006 10:57:55 PM

+1 Boost

Thanks for setting me straight.

Which new Caddy or Lincoln are you getting?

JUGNU - 2/12/2006 12:36:17 PM

+1 Boost

Ohh Now Autospies saying the same thing which i said in my last comment(4 days ago) on ES.
That Lexus is providing two cars in it's entry or Luxury segment.GS for some sporty mind and ES for a little more Luxo.
Whereas BMW,Audi..etc all have only one car in this segment.A6,5 series,E class.

Thatswhy i think this Lexus strategy of giving two cars will give buyers more flexibility in choosing a mid luxury car,therfore they will gain many coustomers old and new both and it will not be easy for them(serious buyers) to walk out of the showroom without taking one.

Yes offcourse "this innovative Lexus strategy be the magic bullet to kill the competition"

JUGNU

JUGNU - 2/12/2006 12:36:17 PM

+1 Boost

Ohh Now Autospies saying the same thing which i said in my last comment(4 days ago) on ES.
That Lexus is providing two cars in it's entry or Luxury segment.GS for some sporty mind and ES for a little more Luxo.
Whereas BMW,Audi..etc all have only one car in this segment.A6,5 series,E class.

Thatswhy i think this Lexus strategy of giving two cars will give buyers more flexibility in choosing a mid luxury car,therfore they will gain many coustomers old and new both and it will not be easy for them(serious buyers) to walk out of the showroom without taking one.

Yes offcourse "this innovative Lexus strategy be the magic bullet to kill the competition"

JUGNU

TheDonII - 2/13/2006 11:42:13 AM

+1 Boost

My point exactly..This is not in the realm of the IS, BMW 3series, Audi A4,6.

A class all of its own..Thats y it is a best seller.

Let me copy it back again to this post.

The Don - 2/9/2006 2:21:48 PM
Title: The ES..My take
Comment:
......This car is in a class all of it's own. Probably you could say it is a smaller version of cars such as the LS, BMW 7series or the Mercedes S class.

It is not a sports sedan like the IS, the 3 series, the C class Merc. If you need a sports sedan buy the IS or other car makes.

Again Lexus is very good in the art of pleasing varying tastes.

It is for this reason that the ES is the best selling luxury car within that price range because it caters to people who are looking for Luxury at an affordable price and at the same time not a sports sedan but one that just pampers you.

Lets give these guys the credit they deserve. Their products are consumer driven not by what a few car critics dole out in car magazines.

I only wished they hadn't gone so over board with the dash.

TheDonII - 2/13/2006 11:59:50 AM

+1 Boost

Guys let me remind you of something...As you know our car makers (meaning american) are failing because they concentrated a lot of their R&Ds on TRUCKS!!!TRUCKS!!! and more trucks and by the time they could realize it, nobody was buying their cars and as truck sales fell so did their profits.

Now we see them getting back into the market but most of their designs do not meet our tastes except for Chrystler who I believe are designing the real "AMERICAN CARS".

Lexus must have seen that loop hole and created the ES..I am sure most of those who end up with the ES may have looked at the A4&6, the G35, the BMW3 series, the Merc C series, the IS, etc. before deciding on the ES.

This should be a lessons learned for these other car companies including the europeans that there are varying tastes out there which they should cater to.

Once again good Job Lexus..though some people are yet to come to terms that you build good products..As the saying goes "build it and they willl come".

wac77 - 2/17/2006 12:54:04 AM

+1 Boost

The ES may be great for Lexus sales, but it also conflicts with the goal of matching the European competition.

If Audi were to start selling a slightly more luxurious FWD Passat (sized like the A6 but priced like the A4), everybody will see that as a mistake that would most likely cannibalize A4/A6 sales (instead of a clever way of bringing a different class of luxury car buyers to the brand).

janos2769 - 2/17/2006 11:24:00 AM

+1 Boost

My 2 cents ...

There are people who like sporty all the way
There are people who like 90% sporty 10% luxury
There are people who like 80% sporty 20% luxury
There are people who like 70% sporty 30% luxury
There are people who like 60% sporty 40% luxury
There are people who like 50% sporty 50% luxury
There are people who like 40% sporty 60% luxury
There are people who like 30% sporty 70% luxury
There are people who like 20% sporty 80% luxury
There are people who like 10% sporty 90% luxury
and there are people who like 100% luxury

To think -and even worse, to say- that Lexus is so smart in targeting this market is either paid by Lexus, owns a Lexus and will proudly and blindly defend it or is just plain senseless. Even a good percentage of people who prefer luxury only will shop for a German car (BMW, Audi, MB), and will most likely end up with a MB (the most luxury oriented of the Germans).

This is Toyota's strategy. Make the Camry, add a few features and get the Avalon, change badges throw in diff colors and wheels and call it an ES. At the end of the day, it's a similar car for the same market. I've driven the Camry and ES and they are boring. So much so that they are a danger to the road (you can literally fall asleep at the wheel from boredom!).

Audis, BMWs and MBs are called Sport Luxury for a reason, they not only offer Luxury (and plenty of it) but they make their cars fun to drive. If you don't like sporty driving then ease off the gas! simple.

TheDonII - 2/17/2006 1:10:15 PM

+1 Boost

I am tired of people who just can see passed their nose...

Ford has many subdivisions, Lincoln, mercury, jag etc..some share either the same platforms,or engines or suspension except body panels. Do you call them all fords NO!!!!!! In fact the front of the new Jag XK looks like a cut and paste Ford Taurus and the interior like the Ford 500.

The General's sub divisions Cadillac, Pontiac, Saturn, Saab, again some share same platforms, engine except body panels...They are not all lumped together as GM.

Daimler/Chrysler same thing..

People think...

Man I am tired of this. Cant they post an article about Lexus without all these energy suckers coming out of the woodworks??