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Lexus News: The Uncertain Future of the Lexus GS and IS

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3 hours ago, balthazar said:

Ideally, mainline brands in 2020 (Chevy, Ford, Nissan, Mercedes, etc) should build 2 sedans, small & mid-sized.
The luxury brands should build mid- and full-size.
 

See my other post, but the 2 of the top 3 selling luxury vehicles in the USA are small sedans, with a mid-size crossover being the 3rd.  And the XT5 is up there too, a mid-size crossover.  Look at CTS and CT6 sales or Continental sales, all dead in the water, Infiniti Q70 and Lexus GS, dead in the water with one foot in the grave.  The only full size luxury car that consistently sells over 1,000 units a month is the S-class, and most of the mid-sizers struggle to hit 2,000 a month unless it is a an E-class or 5-series.  Disregarding small luxury cars is a horrible idea.

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42 minutes ago, smk4565 said:

That is odd because the top 3 selling luxury products in the USA last year were the Lexus RX, 3-series and C-class.  And small sedans as a segment were about flat last year...
...I am not buying into people don't want small cars...

3-series was down 16% vs. 2016 (70K > 59K) while the 5-series was up 25%.
MB CLA was down 20%. The bottom is falling out of small 'lux' sedans, too.

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26 minutes ago, regfootball said:

 

with regards to GM and the sedan market in the USA

 

Cadillac:

ATS was a great idea but it had less space inside than it should have.  And so unless there is a huge need in another market for a compact Cadillac (CT3) I think they don't need one for 2020.  I do think that any future compact Cadillac could be flexible on a RWD vs FWD chassis depending on execution.

Upcoming CT5 IMO is likely to be in a slot between what we traditionally have considered CTS sized and STS sized.  At a minimum the interior needs to have more accommodations than the now current CTS.  But not much more, if any, larger physically.

CT6 of course will continue and is 'large enough' I think.  My only thought on CT6 size is it could be wider by a couple inches inside. 

If cadillac were to add a range topping sedan, it should be more to create a splash with a new design theme or to really break the mold.  For example.... Something Escala like, CT6 sized or larger, or something with a hatch.  Or something sexier than a Tesla  (or all of that).

The CT6 is either replaced by the new design or coexists with it.  The CT6 is the old persons Caddy in that scenario then, and the new design is the young persons large caddy.

Buick

I still like the idea of a Verano but admit it doesn't have the sales legs anymore.  I do think since the Regal sportback is the entry Buick 'sedan' now, it is just fine for that, but they nice to watch prices and redo the packaging for greater value and equipment.

Since the LaCrosse exists, in 2020 I have no issues with it carrying the large sedan torch for Buick, but I do think interior improvements and similar value and packaging propositions are in order.  With fewer sedan buyers, this car really should be increasing sedan market share based on value and ride comfort.  

I really do think the Avenir could have rebooted the large sedan market at accessible price, and if they did that for 2020 (pipe dream) I would endorse it and might even sign on for it 'replacing' the LaCrosse unless the Lacrosse were repackaged to move downscale some and replace the Impala.

 

 

Image result for buick avenir

 

 

Chevy

I still see the Cruze sedan being needed even if it is selling fewer copies.  This is a class of car for entry level new car buyers.  Cruze should grow a bit to be a size clone to match Civic if they redo it.

Malibu needs to continue in this catch all midsize segment.  However, if Impala is discontinued then Malibu needs to increase some in size and offer more flexible packages to allow for larger engine choice easier etc.

I think the Impala can literally continue in its current body 2-4 more years (with an interior redo), or it could be axed if Buick were to take on those sales with the LaCrosse.  If in 2-4 years sedans rebound then they can redo the Impala.  But i think the Impala name right now may be better off transferred to some kind of sexy large crossover which doesn't seem to be the sort of thing GM is capable of.

If the LaCrosse or Avenir or combo of LaCrosse and Avenir could pick up lost Impala sales then it may be ok to kill the Impala.  Then sedans really do become more of an effective niche with a Buick tag on them IMO.

 

 

 

Cadillac is supposed to get a small car, so they would have a 3 sedan line up, I don't see any reason for a car bigger than the CT6, which already has the footprint similar to the Escalade, that is a big vehicle, and the CT6 isn't lighting up any sales charts, why make something bigger.  If you want to load up content and make it nicer and more expensive great.  CT5 is already testing, we'll see in a year or two what it is.

Chevy I feel becomes the Cruze and Malibu, I can't see the Impala surviving Sedan-ageddon.  Unless they downsize the Cruze to like 176 inches long, and make it replace the Sonic and be competition for the Accent, Versa, and cars like that.   Then make the Malibu 185 inches long, sort of like Pontiac Grand Am size where it is a little bigger than a Corolla or Civic but similar price point and then make the Impala like Honda Accord size, or current Fusion size of 195 inches long.  I prefer that plan because you keep the Impala name plate and you keep an entry level car.

Buick I think its possible they have no sedans past 2020.  If they do, then I imagine it would be a larger mid-size, in between the current Regal and Lacrosse, those 2 can merge into one product.  

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14 minutes ago, smk4565 said:

I don't see any reason for a car bigger than the CT6, which already has the footprint similar to the Escalade, that is a big vehicle...

Simple- the CT6 isn't large enough to be the final range topper from Cadillac.
And 204-in isn't 'large', it's just larger than the mid-size cars. A Rolls is 227".

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6 minutes ago, balthazar said:

3-series was down 16% vs. 2016 (70K > 59K) while the 5-series was up 25%.
MB CLA was down 20%. The bottom is falling out of small 'lux' sedans, too.

2017 sales volume in the US, (China and Europe could be a whole other story)  These are the top sellers from each brand

Lexus RX: 108,307

BMW 3+4 series:  99,083

MB C-class: 77,447

Cadillac XT5: 68,312

Audi Q5: 57,640

Acura MDX 54,866

Infiniti Q50: 40,749

And as honorable mentions, the RDX, E-class, GLE and Lexus ES and NX all topped 50,000 units.   So of the top 12 you have 3 small sedan, 2 mid-size sedan, 3 small crossover, 4 mid-size crossover.  The MDX is the biggest thing on this list, if I were a luxury brad I wouldn't be pouring money into full size product, unless it is something like an Escalade or S-class that is a cash cow.

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5 minutes ago, balthazar said:

Simple- the CT6 isn't large enough to be the final range topper from Cadillac.
And 204-in isn't 'large', it's just larger than the mid-size cars. A Rolls is 227".

I suppose Cadillac could do a Phantom or even Ghost sized car for $150,000 but who is going to buy it?  I just can't see them finding a business case for something like that.  

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OK, so you want to combine model lines into 1 total.

BMW has a 2-dr, 4-dr and conv in the 4-series, and (2) 4-drs and a wagon in the 3 series. That's 6 body styles. I don't know/care if all 6 were there in 2016, but in 2017, combined, those two lines fell 7%.

But the 3 is no longer the small sedan at BMW- that's now the 2-series (2-dr, conv, and wagon) plus I assume you'll want to add in the 1-series (4-dr hatch) to be consistent.

2 series alone was down 24% last year and is only running at 28% of the volume of the 4-series. The demand is weak at best. Add to the pot the much thinner margins at the bottom end and ask yourself why a lux brand would want to wade into the mucky shallow end of the lake.

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3 minutes ago, smk4565 said:

I suppose Cadillac could do a Phantom or even Ghost sized car for $150,000 but who is going to buy it?  I just can't see them finding a business case for something like that.  

I know you're super literal, but try and follow the big picture.
There's a LOT of room between 204" and 227"- that's all I'm saying.

CT6 sold 10,5xx units in the US in '17, which was up 15% over '16 (tho I think '16 was the ramp-up year, right?) That's still positive growth. Thru March, the CT6 ticked up another 3%, still positive growth on a high margin product. If it were showing a 16% or 20% drop, I'd have to look at the bottom line WRT recommending it's continuation.

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50 minutes ago, balthazar said:

I know you're super literal, but try and follow the big picture.
There's a LOT of room between 204" and 227"- that's all I'm saying.

CT6 sold 10,5xx units in the US in '17, which was up 15% over '16 (tho I think '16 was the ramp-up year, right?) That's still positive growth. Thru March, the CT6 ticked up another 3%, still positive growth on a high margin product. If it were showing a 16% or 20% drop, I'd have to look at the bottom line WRT recommending it's continuation.

But the CT6 is a 2 country car, USA and China, so we are talking like 20k units a year and that is with a $56k starting point. If they go over $100k, how much demand is there for a Cadillac at that price point?  The E-class outsells the CT6 about 5-1,  CT6 also sells a bit like an Audi A6 in the USA, if you put a Cadillac in the $100k+ range and is outsold 5-1 the way the S-class outsells the A8, then you are talking like 300 cars a month maybe, another 200 or so in China.  There isn't a lot of volume to be found.

I think they are better off with an SUV above the Escalade if they want to do a $100,000+ vehicle.  

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I'm still standing here talking, and now you're way across the cornfield talking at the sky.

We were talking size, now you're wrapped up in price. All I said is, there's room above the CT6 in size at Cadillac. Do I prefer 10,000 CT6 per year, or 100,000? 10,000 every time, as long as it's profitable.

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I see the CT6 continuing to grow volume, particularly after the XTS goes away. By then the new will be gone and they will have a greater percent of the lesser msrp cars. And Cadillacs always sell at discount. It won’t be new anymore so I see them repacking the CT6 to sell in greater volume once the XTS dies and a lot of the development cost of the CT6 is skimmed off the first couple model years. It will become more accessible like a DTS was. You’ll have a bunch that sell with the 3.6 at cheap price and they’ll make money on the twin turbo 6 and 8

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14 hours ago, smk4565 said:

That is odd because the top 3 selling luxury products in the USA last year were the Lexus RX, 3-series and C-class.  And small sedans as a segment were about flat last year, while mid-size sedans dropped and large sedans got crushed.  Small crossover is the fastest growth segment.  So I am not buying into people don't want small cars, people deemed the CR-V and Rav4 too big so they had to get products smaller.   I don't see Honda or Toyota putting out stuff bigger than the Pilot or Highlander due to demand for big vehicles, and Toyota has let the Sequoia die on the vine because there is no point dumping money into a dinosaur that CAFE will kill off.

You completely blew past the word "CARS" and assumed everything small is a "car".

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14 hours ago, balthazar said:

OK, so you want to combine model lines into 1 total.

BMW has a 2-dr, 4-dr and conv in the 4-series, and (2) 4-drs and a wagon in the 3 series. That's 6 body styles. I don't know/care if all 6 were there in 2016, but in 2017, combined, those two lines fell 7%.

But the 3 is no longer the small sedan at BMW- that's now the 2-series (2-dr, conv, and wagon) plus I assume you'll want to add in the 1-series (4-dr hatch) to be consistent.

2 series alone was down 24% last year and is only running at 28% of the volume of the 4-series. The demand is weak at best. Add to the pot the much thinner margins at the bottom end and ask yourself why a lux brand would want to wade into the mucky shallow end of the lake.

BMW does that goal-post moving all the time.  They like to claim they have 76 models, but they count the 3 body styles of 3-series and 3-body styles of 4-series as a single sales number.

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13 hours ago, smk4565 said:

But the CT6 is a 2 country car, USA and China, so we are talking like 20k units a year and that is with a $56k starting point. If they go over $100k, how much demand is there for a Cadillac at that price point?  The E-class outsells the CT6 about 5-1,  CT6 also sells a bit like an Audi A6 in the USA, if you put a Cadillac in the $100k+ range and is outsold 5-1 the way the S-class outsells the A8, then you are talking like 300 cars a month maybe, another 200 or so in China.  There isn't a lot of volume to be found.

I think they are better off with an SUV above the Escalade if they want to do a $100,000+ vehicle.  

The E-Class is used as a taxi, that's where a huge bulk of the volume comes from. It is the Crown Vic of Europe. It is the Caprice of China.

CT6 doesn't get used as a taxi

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12 hours ago, regfootball said:

I see the CT6 continuing to grow volume, particularly after the XTS goes away. By then the new will be gone and they will have a greater percent of the lesser msrp cars. And Cadillacs always sell at discount. It won’t be new anymore so I see them repacking the CT6 to sell in greater volume once the XTS dies and a lot of the development cost of the CT6 is skimmed off the first couple model years. It will become more accessible like a DTS was. You’ll have a bunch that sell with the 3.6 at cheap price and they’ll make money on the twin turbo 6 and 8

I think you're half right.  I do see them increasing in volume, but not by discounting it.  With the extremely handsome update to an already handsome car coming, I doubt they'll feel the need to discount the car any.  They will increase volume simply by moving mid-range XTS buyers  to CT6 (base AWD XTS is only $3k less than base CT6 AWD), and base XTS buyers will either step up to CT6 or down to CT5.  XTS V-Sport ($71,490) buyers will feel quite comfortable in a CT6 Premium Luxury 3.0TT AWD ($68,290 before any options).

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i guess when i mentioned the discounting i sort of was thinking there would be a greater inventory supply of the 70k +/- versions instead of the insane 90k versions, LOL

 

and then the dealer discounts etc is another 10 grand off.

Edited by regfootball

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13 hours ago, balthazar said:

I'm still standing here talking, and now you're way across the cornfield talking at the sky.

We were talking size, now you're wrapped up in price. All I said is, there's room above the CT6 in size at Cadillac. Do I prefer 10,000 CT6 per year, or 100,000? 10,000 every time, as long as it's profitable.

So you want a car that is 10 inches longer than a CT6 at like $75k?  They are going to run into the same product overlap problem they now with sedans.  They would have to go to $100k to clear the CT6 V8.

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1 hour ago, Drew Dowdell said:

The E-Class is used as a taxi, that's where a huge bulk of the volume comes from. It is the Crown Vic of Europe. It is the Caprice of China.

CT6 doesn't get used as a taxi

And yet the E-class still has more status or brand appeal than a CT6.  They have had E-class taxis for 40 years and that hasn’t hurt Mercedes image one bit.  The huge volume keeps the dollars rolling in to support Daimler’s massive R&D budget.

13 hours ago, regfootball said:

I see the CT6 continuing to grow volume, particularly after the XTS goes away. By then the new will be gone and they will have a greater percent of the lesser msrp cars. And Cadillacs always sell at discount. It won’t be new anymore so I see them repacking the CT6 to sell in greater volume once the XTS dies and a lot of the development cost of the CT6 is skimmed off the first couple model years. It will become more accessible like a DTS was. You’ll have a bunch that sell with the 3.6 at cheap price and they’ll make money on the twin turbo 6 and 8

Agreed, I could see the CT6 being Cadillac’s Dodge Charger/Challenger.  You advertise the high trim V8 model but in reality 80-90% of the sales are the base V6 with little equipment.

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6 minutes ago, smk4565 said:

And yet the E-class still has more status or brand appeal than a CT6.  They have had E-class taxis for 40 years and that hasn’t hurt Mercedes image one bit.  The huge volume keeps the dollars rolling in to support Daimler’s massive R&D budget.

Agreed, I could see the CT6 being Cadillac’s Dodge Charger/Challenger.  You advertise the high trim V8 model but in reality 80-90% of the sales are the base V6 with little equipment.

Er... no.  Most CT6s are sold at least mid-level.  Dealers don't even stock the base 2.0T, it is by order only. 

The E-Class has more status here because it was never used as a taxi.  It has no particular status in the EU.  Europeans understand it can be optioned up nicely, but they are just as likely to get into an orange/beige one and driven to the airport.  The vast majority of E-Classes in Europe are not privately owned... just like the Crown Vic here.  Germans buy german vehicles.  This isn't rocket science.

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25 minutes ago, smk4565 said:

So you want a car that is 10 inches longer than a CT6 at like $75k?  They are going to run into the same product overlap problem they now with sedans.  They would have to go to $100k to clear the CT6 V8.

Why not start it at like 90-95k? I mean at this size we're talking ultra premium type of vehicles so they shouldn't cheapen out anywhere on a vehicle like that. 

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14 hours ago, smk4565 said:

 The E-class outsells the CT6 about 5-1,

http://media.daimler.com/marsMediaSite/en/instance/ko.xhtml?oid=32692930&ls=L3NlYXJjaHJlc3VsdC9zZWFyY2hyZXN1bHQueGh0bWw_c2VhcmNoU3RyaW5nPTIwMTcrbWVyY2VkZXMtYmVueitzYWxlcyZzZWFyY2hJZD0xJnNlYXJjaFR5cGU9ZGV0YWlsZWQmYm9yZGVycz10cnVlJnJlc3VsdEluZm9UeXBlSWQ9NDA2MjYmdmlld1R5cGU9bGlzdCZzb3J0RGVmaW5pdGlvbj1QVUJMSVNIRURfQVQtMiZ0aHVtYlNjYWxlSW5kZXg9MCZyb3dDb3VudHNJbmRleD01&rs=1

This is the global report of which in 2017 the E-Class sold 350,000 units world wide of which China and India more than doubled E-Class Sales of the extended length version to services and Europe picked up on buying the extended length E-Class again in services.

Services is hidden code for Taxis / limo driving. 

Did they sell a ton of E-Class? YES

Did it outsell CT6? YES

Is it sold heavily into fleets? YES

Comparing CT6 to E-Class is an Apple to Orange comparison if you go by price or total sales as CT6 is not fleet sold that anyone is aware of. E-Class is FLEET SOLD.

So do you want the girl that is passed around to everyone or the Princess?

I take the Princess, aka CT6.

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1 hour ago, Drew Dowdell said:

Er... no.  Most CT6s are sold at least mid-level.  Dealers don't even stock the base 2.0T, it is by order only. 

The E-Class has more status here because it was never used as a taxi.  It has no particular status in the EU.  Europeans understand it can be optioned up nicely, but they are just as likely to get into an orange/beige one and driven to the airport.  The vast majority of E-Classes in Europe are not privately owned... just like the Crown Vic here.  Germans buy german vehicles.  This isn't rocket science.

But the 2.0 is gone for 2019.  so the 3.6 sort of becomes the base level.  there will probably be a fairly even split of 3.6 vs 3.0tt.  to make up that 90+ % of CT6 sales.

the 2.0t CT6 will become collectibles.  and will be selling cheap at auctions.  Non snow state buyers will get a nice used 2.0t RWD for midsize chevy money in about 1-3 more years.

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Yes, the 2.0 is gone, but that won't effect sales since no one was buying it or even stocking it. Don't expect a price drop for the 3.6  except that there will be a RWD 3.6 available, so an option delete credit there. I'm wondering if the 2.0t will continue in China though.

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6 minutes ago, Drew Dowdell said:

Yes, the 2.0 is gone, but that won't effect sales since no one was buying it or even stocking it. Don't expect a price drop for the 3.6  except that there will be a RWD 3.6 available, so an option delete credit there. I'm wondering if the 2.0t will continue in China though.

Considering the stupid displacement tax they have, I would totally think they would keep the 2.0T 4 banger going for China.

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      The last-generation Lexus LS felt a bit lost. It had many of the qualities of previous LS models, but it could not fully compete with the likes of Mercedes-Benz S-Class, Audi A8, and BMW 7-Series. People pointed out the somewhat plain design, lackluster performance of the V8 engine, or the confounding infotainment system as possible reasons. But I think the reason comes down to Lexus not having something that made the LS stand out. How do you right the ship of what many considered to be at one time, the best luxury sedan on sale? If you’re Lexus, that means making some very drastic changes.
      Lexus has tended to play it safe with the LS’ design to fit with the general idea of a flagship sedan - providing a presence without shouting. But this new generation decides to stray away from that idea. The front end features a lot of inspiration from LC coupe with a wide grille, protruding cutouts for the faux vent, and a lowered hood. A set of Z-shaped LED headlights help the LS stand out from other Lexus models. The rest of the design looks to be an evolution of the previous model with slightly wider fenders and a new trunk lid design. 
      One of the places that LS surprised me was the interior. The layout is quite attractive with a flowing dash and contours on the door panels. A clever touch is the horizontal slat pattern used on the center part of the dash that somewhat disguises the center vents. Material quality is top-notch with leather, real wood, and metal used throughout. 
      This particular test vehicle was equipped with perforated leather upholstery which had a unique snakeskin pattern. I quite liked it, but some who rode in the vehicle found it to be a bit gaudy. This seat pattern is only available on the F-Sport, all other LS models have a plain design. The front seats are quite comfortable and provide numerous power adjustments, along with heat and ventilation. Rear seat passengers will find plenty of legroom, but tall passengers will be annoyed by their heads touching the roof liner, a major downside to the lower roofline.
      The interior also houses a big disappointment; Lexus Remote Touch. The touchpad controller is still confounding and distracting to use as you need to be precise with your finger movements to correctly select the function you want. Otherwise, you’ll end up on another screen and want to scream. This is disappointing considering that Lexus Enform has improved a lot. The system is noticeably quicker in various functions and can use Apple CarPlay and Amazon Alexa.
      Despite the 500 designation, there is not a 5.0L V8 under the LS’ hood. Instead, Lexus is using a twin-turbo 3.5L V6 engine with 416 horsepower and 442 pound-feet of torque. A ten-speed automatic routes power to either the rear or all four wheels like in my test vehicle. The twin-turbo V6 is disappointing when leaving a stop as there is a considerable amount of turbo lag between pressing the accelerator and the engine responding. Once you get past this, the V6 provides plenty of scoot. Never once did I think that the V8 would be better whenever I need to merge or speed out of a corner. It is also noticeably quieter and more refined than the old V8.
      Fuel economy is rated at 18 City/27 Highway/21 Combined if you opt for AWD. Stick with RWD and the numbers rise to 19/30/23. My average for the week landed at 20.2 mpg on a 60/40 mix of highway and city driving.
      Picking the F-Sport trim will get you a revised suspension setup and uprated brakes. It will not transform the LS into something like an Alpina B7 or a Mercedes-AMG S63, but it does make the vehicle feel a bit more poised on a winding road. When put into S+ mode, Body roll is kept in check and the steering is quick to respond. The coil springs used on the LS F-Sport are a bit stiff, which will provide a more choppy ride. An optional air suspension is reportedly better at dealing with bumps and other imperfections, but I will need to try it out before saying it is better or not.
      This drastic move by Lexus with the new LS could have gone wrong, but it pulls it off. The new model is more interesting to look at, luxurious and offers improved driving dynamics when ordered with the F-Sport package. There are still some thorns Lexus needs to extract such as the poor initial performance of the twin-turbo six and the mess that is Remote Touch. If you’re willing to deal with these issues, then the 2019 LS is a very viable alternative to the Germans.
      How I would configure an LS 500: Most likely I would build one similar to the one seen here, although I would get it in red as I think the paint really makes the design pop. 
      Alternatives to the LS 500
      Mercedes-Benz S-Class: The S-Class is still considered by many to be the best of the best. Considering its wide range of engines, very smooth ride, and impressive interior quality, it is tough to argue this. But the LS comes very close to matching the S-Class's interior quality, along with a more eye-catching design. It doesn't help that the S-Class is about $7,000 more than the LS. Genesis G90: Still the bargain in the flagship sedan class with a base price of $69,350 and coming with almost every feature you would expect. The twin-turbo 3.3L V6 offers better off-the line performance than the 3.5 found in the LS. But the LS offers higher quality interior materials than what is available in the G90. Disclaimer: Lexus Provided the LS 500, Insurance, and One Tank of Gas
      Year: 2019
      Make: Lexus
      Model: LS
      Trim: 500 F-Sport
      Engine: 3.5L Twin-Turbo 24-Valve DOHC V6
      Driveline: 10-Speed Automatic, All-Wheel Drive
      Horsepower @ RPM: 416 @ 6,000
      Torque @ RPM: 442 @1600 - 4800
      Fuel Economy: City/Highway/Combined - 
      Curb Weight: 5,027 lbs
      Location of Manufacture: Tahara, Aichi, Japan
      Base Price: $84,420
      As Tested Price: $88,605 (Includes $1,025 Destination Charge)
      Options:
      Mark Levinson Audio System with 23 Speakers - $1,940.00
      24-Inch Heads-Up Display - $1,220.00
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