Lexus Struggles to Maintain Momentum in Europe

Posted by Kevin on January 11th, 2023

Lexus had a tough year in the United Kingdom, with 2022 sales down 31% and its market position plummeting below even Jaguar & Porsche. It was even worse across Europe — from Autocar:

Lexus sales to the end of November in the UK reached just 9034, down 31% to put it behind even beleaguered Jaguar, according to UK automotive lobby group the SMMT. Even in its best year, 2019, it only sold 15,713.

Despite those small numbers, the UK’s still a relatively big market for Lexus compared to the rest of Europe. The brand sold 30,265 to the end of October across the region, down 27%. according to the SMMT equivalent for Europe, ACEA.

The discontinuation of sales in Russia can account for most of Europe’s drop, but supply is also a major culprit — Europe would struggle to divert inventory from bigger markets like the USA and China. The lack of vehicles is evidenced most clearly by the announcement that the entire 2023 NX allotment is already sold.

That Toyota is persisting with Lexus in Europe is a compliment really, given how little it needs us. The brand notched up an impressive 760,012 sales globally in 2021, dominated by the US (332,000) and China (227,000). Europe, including the UK, for the same period was just 47,604.

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spwolf

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they dont have vehicles to sell, so they cant sell them... Due to chip shortage
 
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LordByronUK

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Also used car sales of Lexus are much much more popular here in the UK than new cars given how reliable they are and how well they hold value used. The price of new Lexus cars here in the UK is a big ridiculous quite frankly, they need to be more aggressive on pricing.
 
Will1991

Will1991

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The only proper car they sell in Western Europe (given our tastes) is the NX450h+ which has been in low supply with a extended waiting list.

  • UX250h has an awfully small boot and the UX300e still uses ChaDeMo. The UX is also more expensive but smaller than the competition (GLA/XC40/X1).
    • Volvo is making a killing with the XC40 PHEV due do local subsidies and tax cuts
  • ES300h needed to be PHEV to take advantage of local subsidies and tax cuts (The ES300h is much more expensive as a company car than the 530e).
  • LS500h is going for a almost non existent market.
  • RX main market around here was Russia
  • RZ is still 2 months away.
 
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Tragic Bronson

Tragic Bronson

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LordByronUK said:
Also used car sales of Lexus are much much more popular here in the UK than new cars given how reliable they are and how well they hold value used. The price of new Lexus cars here in the UK is a big ridiculous quite frankly, they need to be more aggressive on pricing.
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I thought Lexus were really cheap to buy, but that was 5 years ago.
jalopnik.com

How Much Does Your Car Cost In England?

That old Lexus wagon right there? That’s my car. It’s a 2002 Lexus IS300 Sportcross. When I bought it last year it had the all-clear from a Lexus dealership, and roughly 73,000 miles on it. I paid (not to brag) $10,250 for it, which was roughly market rate. A very similar car just sold in...
jalopnik.com jalopnik.com
This is a 2002 Lexus IS200 Sportcross, just sold in England for the princely sum of £500.
Click to expand...
 
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Levi

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Lexus does nothing for Europe, I mean that is peanuts. All Lexus in Europe are sold to those that know/buy Toyota. Marketing wise Lexus has no brand value/image/recognition in Europe (except Eastern Europe.) But Eastern Europe also like German cars, Lexus would sell even more there if they were more competitive (more models, powerful versions). The only way for Lexus to gain market share is to target a customer profile that has high influential power.
 
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They have just LS500 H in Switzerland as sedan.
How they expect to sell enough when they have not enough models to compete with European rivals?
There is No IS, No ES, No Rc anymore, no LS turbo
and what they have as SUV is even not available.
So what they expect.
I Love LEXUS cars and it's a pity that they don't really invest in Europe.
Even the LC has no 360 camera with 145000 francs pricetag.😔
 
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Sulu

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Dody said:
They have just LS500 H in Switzerland as sedan.
How they expect to sell enough when they have not enough models to compete with European rivals?
There is No IS, No ES, No Rc anymore, no LS turbo
and what they have as SUV is even not available.
So what they expect.
I Love LEXUS cars and it's a pity that they don't really invest in Europe.
Even the LC has no 360 camera with 145000 francs pricetag.😔
Click to expand...
It is not always a "build it and they will come" situation. Sometimes, even with an automaker's best intentions, they are just unable to sell. The automaker may not be able to sell enough to justify importing certain models, much less building cars locally. Each model requires a certain critical mass of sales to buyers before they can justify selling (importing or building). A special model, aimed specifically at the European market, may be able to sell, but if that particular model will not sell in other markets (such as Lexus's largest markets, the USA and China), the automaker cannot make a business case to design and build that model.

I suspect that is the situation in Europe for Lexus. Lexus is just not able to break into a market so long- and largely-dominated by such well-known brands as BMW and Mercedes-Benz and Porsche.
 
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Levi

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Sulu said:
It is not always a "build it and they will come" situation. Sometimes, even with an automaker's best intentions, they are just unable to sell. The automaker may not be able to sell enough to justify importing certain models, much less building cars locally. Each model requires a certain critical mass of sales to buyers before they can justify selling (importing or building). A special model, aimed specifically at the European market, may be able to sell, but if that particular model will not sell in other markets (such as Lexus's largest markets, the USA and China), the automaker cannot make a business case to design and build that model.

I suspect that is the situation in Europe for Lexus. Lexus is just not able to break into a market so long- and largely-dominated by such well-known brands as BMW and Mercedes-Benz and Porsche.
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Marketing is not Japanese's forte.
 
Tragic Bronson

Tragic Bronson

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Levi said:
Marketing is not Japanese's forte.
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Not necessarily...Lexus did very well in the US with their early commercials. Lexus EU had gone with a different ad agency, while USA has had the same one for since inception.
www.thedrum.com

Lexus on the realities of putting a creative agency in its headquarters

Lexus is two years into an experiment with The&Partnership which has seen a team of 30 creatives from the WPP agency move into its European headquarters. It's resulting in "bolder work" says the marketer charged with leading it, but it hasn’t all been smooth sailing.
www.thedrum.com www.thedrum.com
 
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