Lexus backs GS, future large liftback likely

LEXUS Australia chief executive Peter McGregor has rejected reports that the next-generation GS large car has been cancelled, pointing instead to a possible evolution of the traditional sedan into a more fashionable coupe-style model.

The current, fourth-generation GS launched in Australia in 2012 and is due for imminent replacement, however Lexus globally has not yet communicated a timeline for the successor for its BMW 5 Series and Mercedes-Benz E-Class rival.

A report from Japanese magazine MagX earlier this year quoted an internal Lexus source saying that the next-generation GS had been cancelled, however that appears to be incorrect, according to Mr McGregor.

“I think it (new GS) would still be a four-door sedan in terms of its application, but the exterior styling may appear to be more liftback,” he told GoAuto at the national media launch of the Lexus LC in Tyabb, Victoria, this week.

“I’m not saying anything about the future, I’m just saying if you … want to talk about how we’re going to reinvigorate the sedan market, I think you can probably take a clue from the design of the next-generation LS.

“The styling of the vehicle is very much moving from a traditional three-box sedan, if you will, to more of a liftback body style. And I think that that change will actually add great appeal to the sedan market.”

While cautioning that he “can’t really speak about those future models” in detail, Mr McGregor admitted that even a new-generation GS would struggle to improve the overall fortunes of the large passenger car market.

“Do I think it (a new liftback) will reverse the trend to SUV?” he asked.

“No, I don’t. I think what we’re seeing with SUVs is going to be something that will be impacting our luxury market as it’s impacted luxury markets around the world for a period of time.

“But I don’t think that means that we give up on sedans at all.”

The $70K-plus large sedan and wagon market is up 37 per cent year-to-date, according to VFACTS May 2017 results, however this is entirely on the back of volume warfare between the just-released 5 Series (688 sales so far this year, up 196.6 per cent) and the barely older E-Class (876 units, up 135.5 per cent).

The fresh German duo have decimated rivals in the segment, with the Lexus GS down 17.4 per cent to 76 year-to-date sales, and the Audi A6 (129 units, falling 43.2 per cent) and Jaguar XF (98 sales, down 49.2 per cent) only slightly ahead.

Although the Lexus RX in the $70K-plus large SUV category has achieved 768 sales this year, down 6.7 per cent, according to Mr McGregor it is not a fait accompli that the Japanese luxury brand would abandon the large sedan market.

“It's pretty competitive,” he acknowledged of the situation.

“(But) the answer to that is not to withdraw, I don’t think. The answer to that is okay, our time will come, let’s make sure that we continue to offer great customer service and let’s make sure when our new product does arrive that they will understand the benefits of that product.” Asked whether Lexus dealers thought there was still room in showrooms for both the GS and its slightly smaller ES mid-size sedan sibling, Mr McGregor replied: “I think what dealers like is a full line-up.

“They want to be able to offer a competitive product that meets the market requirement in every key segment,” he continued.

“While we see the sedan segment in decline, and while we understand that based on competitive life cycles that sometimes that you have an older model while a competitor has a new model, and that impacts things, we understand that.”

The ES, which starts from $63,750 plus on-road costs compared with $76,220 for the GS, has recorded a slightly higher and steady 109 sales this year – down by a single unit compared with May last year.