Lexus targets new luxury buyers with IS
BROOKLYN, Mich. — Lexus takes a big step toward shedding its image for bland styling with the IS that it previewed last month for journalists and industry analysts at Michigan International Speedway.
“The target from the start was to make the new IS the most ‘fun to drive’ vehicle in its class,” said Owen Peacock, Lexus national marketing manager.
Lexus has never fallen short on quality or interior comfort, but it needed to step up its game to compete in a growing entry-level luxury-car segment.
“The Lexus IS was always intended to compete with the BMW 3-Series and MercedesBenz C-Class, but it wasn’t really known for performance,” said Dave Sullivan, an analyst with AutoPacific. “This is probably one of the most overlooked cars in the Lexus brand.”
The redesigned 2014 Lexus IS will arrive in dealerships in a couple months with a more aggressive look and more pep in its power-train step. Japan’s No. 1 luxury brand is trying to regain leadership in the luxury market, now dominated by BMW and Mercedes-Benz.
“This IS gives us a strong foothold in the fastest-growing segment in luxury,” Peacock said.
Showcasing an updated treatment of the signature Lexus spindle grille, the new IS shows off a more sculpted body and a slightly larger interior featuring the best materials and easy-to-use controls.
Sullivan said the grille differentiates this model from its German competitors.
Beneath the hood, there are two choices: the IS 250 with a 2.5-liter V-6 that delivers 206 horsepower. The IS 350 is powered by a 3.5-liter V-6 that puts out 306 horsepower.
Sales of entry-level luxury cars are up 9.6 percent through the first four months of this year, better than the overall industry’s 6.5 percent increase.
“Luxury manufacturers have had to pay special attention to their latest redesigns since the market has grown far more competitive in recent years,” said Alec Gutierrez, analyst for Kelley Blue Book.
Gutierrez said a recovering real-estate market and a wave of customers reaching the end of leases have helped to boost luxury sales.
Peacock said the average age of the current Lexus IS owners is 45, slightly lower than the average age for the Audi A4, Mercedes-Benz CClass or BMW 3-Series.
“Reaching a younger consumer with traditional marketing can be challenging,” Peacock said. “They are busy professionals with very active lives.”
Mercedes-Benz announced during February’s Super Bowl that it will sell the new CLA compact sedan for a base price of less than $30,000 when it goes on sale in September.
Lexus said Tuesday it will raise the base price of the Lexus IS 250 by $885 to $35,065 but will lower the Lexus IS 350 starting price by $835 to $39,950.
Lexus has added features valued at more than $1,400 as standard equipment that was optional on the outgoing model.
Sullivan said the Lexus IS is likely to face increasing pricing pressure from competitors and remains exposed to the rising value of the Japanese yen.
Most Lexus models, including the IS, are made in Japan, but in April, Toyota President Akio Toyoda announced the company will begin building the Lexus ES sedan in Georgetown, Ky., beginning in 2015.