Lexus and Infiniti Reach 25th Birthdays, Proving Their Challenges Worked

The philosophy behind the attack on the luxury market was that high-end buyers wanted more reliable cars, and ones backed by dealers that would pamper them. Toyota and Nissan had the product development and balance sheets to lay siege to the established brands. Loyalty to Ford Motor Co.’s (NYSE: F) Lincoln and General Motors Co.’s (NYSE: GM) Cadillac had already started to slip due to the advance of German imports.

Fast forward to 2014, and in August Toyota sold 32,809 Lexus cars and SUVs, up 10.4%. The Mercedes number was 28,958, or up 10.7% for the month. BMW weighed in at 27,214, up 11%. Infiniti, on the other hand, barely competes with Cadillac. Infiniti’s unit sales volume was 9,164, down 22.9% in August. The Infiniti count looked more like Lincoln’s, which for the month was 8,146, down 0.6%. Although better off than Infiniti, Cadillac’s chance to catch the market leaders has fallen apart for now, as its August sales were 16,650, down 17.8%.

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One argument about why Lexus has prospered and Infiniti has not is that Lexus has a very broad line of models. Infiniti offerings are built around a very modest line of coupes and sedans, with very little in the way of crossovers, wagons and SUVs. Infiniti is at least in the midst of launching several new vehicles, led by the QX80 big SUV and a sedan that will be among the fastest in the world — the Q50 Eau Rouge. Too bad, the Q50 is based on the Nissan GT-R, which is too powerful and too expensive for most buyers with a base price of more than $100,000.

Lexus, though, is expected to release three vehicles, a launch rate that is closer to that of Mercedes and BMW. Lexus has also been aided by its image as a car company that offers luxury cars priced below the two leading Germans, along with quality rankings that often top the industry. Its sales figures indicate the push has worked.

Twenty-five years past the launches of Infiniti and Lexus, the notion that the Japanese could build luxury cars been proven, even though one attempt has been hugely successful and the other has stumbled.

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