Lexus keeps lead over BMW in U.S. luxury-vehicle sales

LOS ANGELES November 22, 2002; Jeff Green writing for Bloomberg reports that John Fintland says he saved about $6,200 off the $54,000 sticker price on the GS 430 sedan he bought in August from Toyota Motor Corp.'s Lexus unit.

Fintland, a 43-year-old engineer in Los Angeles, is among 24,123 buyers that month who took advantage of lower lease rates, loan discounts and dealer price breaks, helping Lexus pull past Bayerische Motoren Werke AG in U.S. luxury-vehicle sales. Lexus was ahead of BMW through October and analysts expect the lead to hold up for the Toyota brand's third straight annual title.

"It's more than just wanting to beat BMW, they want to show that Lexus can grow in the U.S.," said CNW Marketing analyst Art Spinella, who tracks automakers' price and loan discounts. "Obviously, they are willing to use incentives to do that."

The two automakers have used new sport-utility vehicles such as the BMW X5 and Lexus RX 300 and updated versions of cars such as the BMW 7-Series and Lexus GS 300 to take market share from General Motors Corp.'s Cadillac and Ford Motor Co.'s Lincoln. Asian and European automakers with better reputations for quality have been able to rely on lower levels of incentives than U.S. makers to sell their cars and trucks, Spinella said.

"Clearly Lexus will throw them on when they need them," he said.

The August discounts led to a monthly sales record for the Japanese automaker's luxury brand, erasing a slim BMW lead. Through October, Toyota was ahead 192,155 to 188,185.

Lexus incentives in August averaged about $2,500 per vehicle compared with $1,411 at BMW, Spinella said. Luxury-vehicle incentives are highest at U.S.-based makers, averaging about $5,000 per car or truck sold, he said.

"I waited until August to buy because I knew that's when I'd have the most leverage," said Fintland, the Los Angeles engineer who bought the 2002-model Lexus sedan. "I never considered any other brand. Lexus has the best features."

Lexus routinely has a Golden Opportunity sale in August to push the current year's vehicles and make room at dealers for the next model-year cars and trucks, which start selling in September, said spokeswoman Nancy Hubbell.

BMW doesn't have an August sale, said Martha McKinley, a spokeswoman for the German automaker. BMW's luxury sales total doesn't include its Mini cars, which the company began selling the U.S. this year.

Since 1998, Lexus, BMW and DaimlerChrysler AG's Mercedes have moved ahead of the U.S.-based rivals. Honda Motor Co.'s Acura this year passed Lincoln and is fifth behind Cadillac. Cadillac and Lincoln's combined share of U.S. luxury-vehicle sales slid to 21.4 percent this year through October from 29.8 percent in 1998, according to Ward's AutoInfoBank.

Lexus is expected to finish this year with U.S. sales of 231,185 cars and light trucks, compared with 228,023 luxury vehicles for BMW, said Rebecca Lindland, senior analyst for forecasting company Global Insight Inc., formerly DRI-WEFA.