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Old 19th September 2018, 10:47   #1
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Default Lexus: 80 percent of Indian customers are Toyota owners!

Lexus India President - Mr. P B Venugopal, in his recent interview with Autocar India has stated that 80% of Lexus customers in India are Toyota owners.

He further goes on to state that it was their initial hypothesis about the Indian market and they are glad it is happening this way. 'Customers who own the Innova, or the Fortuner or the Camry or the Corolla, are high net worth individuals who also want to own the Lexus'. The remaining 20%, specially in the case of the ES, considered it over the Germans - specially the E class.

Lexus: 80 percent of Indian customers are Toyota owners!-screen-shot-20180919-10.37.18-am.png

Another interesting statistic is that 60% of Lexus customers considered the brand because it was a hybrid. He further states that he 'Thinks its a combination of many factors - environment conscious, fuel efficiency, and many of the customers also speak about the technology that has gone behind the hybrid'. 40 -50% of overall sales come from near the NCR region!

Full interview -



IMHO, Looks like a good and bad situation to place the brand in -

+ Customers have identified Lexus with the same known Toyota virtues.
+ Many rich households own an Innova or a Fortuner along with their Germans. This could pose good upgrade opportunities in the future.

- The existing customers for Luxury German brands hardly seem to have taken notice.
- Petrol hybrid tech over diesel Germans seems to be main USP, but could be diluted in the near future with the Germans coming in with their hybrids and electric.

Last edited by CrAzY dRiVeR : 19th September 2018 at 10:50.
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Old 19th September 2018, 10:56   #2
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

I wonder how many of those Toyota Owners are actually Toyota or Lexus Dealership Owners.

Last year I saw a cavalcade of Fortuners and Lexus cars near Kodai which all belonged to the Lanson Toyota group.
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Old 19th September 2018, 11:16   #3
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

Mr Venugopal may have a point there.

If all goes well, and the my home minister permitting the financial outgo, I intend buying a lux car some day. The choice will be between a petrol M-B, a BMW or a Lexus. Audi is unlikely. Although I might feel differently after driving my cousin's brand new Audi S5 delivered just yesterday.

Given my decade+ long experience with Toyota and based on V Narayan's brilliant thread on his Lexus experience, a Lexus is certainly high on my shortlist. But then I am a bit concerned about a hybrid car's battery life. And then there's the pleasure of driving a M-B or a BMW an altogether different experience. So they remain on my list of high probability choices.

Last edited by R2D2 : 19th September 2018 at 11:18.
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Old 19th September 2018, 11:19   #4
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

Quote:
Originally Posted by CrAzY dRiVeR View Post
.. stated that 80% of Lexus customers in India are Toyota owners.
I would be curious to know if most of them would be Toyota owners who also own German luxury cars. If someone is a high net worth individual and keeps a Toyota as the primary car, then he/she is likely to be very particular about the image his/her car projects and the value for money aspects of car ownership. In that respect Lexus is not very different from the German counter parts in India at current prices. Of course, Hybrid powertrain is likely to be their main draw.

Last edited by androdev : 19th September 2018 at 11:21.
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Old 19th September 2018, 11:24   #5
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

Quote:
Originally Posted by CrAzY dRiVeR View Post
Lexus India President - Mr. P B Venugopal, in his recent interview with Autocar India has stated that 80% of Lexus customers in India are Toyota owners.
Not surprised there, most Toyota owners swear by their vehicle's reliability and are unwilling to compromise on that factor in their next car. The Lexus offers a good opportunity in this regard.

Quote:
'Customers who own the Innova, or the Fortuner or the Camry or the Corolla, are high net worth individuals who also want to own the Lexus'. The remaining 20%, specially in the case of the ES, considered it over the Germans - specially the E class.
The Camry/Corolla owners might consider it as an upgrade, but I highly doubt Innova and Fortuner owners considering the Lexus. Maybe the chauffeur driven Innova owners might be swayed, but there is no way a Fortuner owner would consider a Lexus.

Quote:
- The existing customers for Luxury German brands hardly seem to have taken notice.
- Petrol hybrid tech over diesel Germans seems to be main USP, but could be diluted in the near future with the Germans coming in with their hybrids and electric.
Lexus has got a first mover advantage in a segment where the differentiating feature (like the Hybrid) sways customers more than the outright pricing. However, considering their pricing, they need to start CKD operations ASAP. I agree that quality control is a positive for imported cars, but its high time they offer competitive prices to the Germans and not one segment over.
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Old 19th September 2018, 11:30   #6
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

Lexus need to do 2 things. First get those ugly front grilles replaced with something more subtle, second get your pricing right. The sales will just increase and will pull buyers who would be considering the German trio.
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Old 19th September 2018, 11:40   #7
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

Quote:
Originally Posted by CrAzY dRiVeR View Post
- The existing customers for Luxury German brands hardly seem to have taken notice.
I see this as a win win for Toyota-Lexus that the current customer are preferring to stay within the brand. Also, every luxury car buyer also has a beater for everyday use and in most cases that a Toyota (from Innova to Fortuner) and they might want to stay within the fold too, including the one's with a German luxury car.
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Old 19th September 2018, 11:42   #8
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

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Originally Posted by extreme_torque View Post
I see this as a win win for Toyota-Lexus that the current customer are preferring to stay within the brand.
Lexus would have been happy if 80% Toyota owners bought a Lexus.

I'm interested to know the overall sales figure too - to know the actual relevance of this 80%. Somehow I have seen only a couple of Lexus cars here on the roads in Bangalore.
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Old 19th September 2018, 12:45   #9
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

Quote:
Originally Posted by CrAzY dRiVeR View Post
The remaining 20%, specially in the case of the ES, considered it over the Germans - specially the E class.

Another interesting statistic is that 60% of Lexus customers considered the brand because it was a hybrid.

- Petrol hybrid tech over diesel Germans seems to be main USP, but could be diluted in the near future with the Germans coming in with their hybrids and electric.
I guess the market share of Lexus is minuscule compared to the Germans. So MB may have barely noticed those few who chose Lexus over E class. Otherwise, I think a high preference for hybrid cars would've triggered the Germans to launch their own hybrids already. It's not like they don't have them ready, especially if they launch them as CBUs (which as GTO says MB loves to do every other week).

My friend inquired about GLC hybrid back in May. He was told that he could not order one until October 2018, and even if he places the order in October, he can hope to get it only in May 2019! Then he asked about the C-class hybrid and got similar answer about the timeline for placing the order and that he could get it probably in August 2019!!
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Old 19th September 2018, 13:09   #10
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

To make sense of this statistic, we need to know what percentage of E-Class/A6/5 series owners in Metro cities (where Lexus operates) are Toyota customers. The percentage is likely to be very high because of popularity of Innova/Fortuner/Camry/Corolla in multi-car well-to-do households.
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Old 19th September 2018, 13:10   #11
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

My controversial reaction would be that here we have people who have not hesitated in OVERPAYING for say a Toyota Innova, Camry or Fortuner; Obviously they would be fine OVERPAYING for a Lexus. The Same TG.

Hey! This seems to be a PR effort for the sake of PR, there is no point in analysing the customer segmentation of what is a micro player in the Luxury market right now.

I see Toyota vehicles being grossly overpriced and feel the same about Lexus. That said Toyota is doing well in it's product segments so it should have sufficient customers prepared to upgrade for more of the same.

Both Toyota and Lexus being reliable is of course another way of looking at it, and that they are both essentially the same or more of the same yet another. (Platform sharing like for VW and Audi).

Last edited by ACM : 19th September 2018 at 13:12.
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Old 19th September 2018, 13:44   #12
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

Saw the new ES in person a couple of times and its bling level next. Its the perfect car for India IMHO. The E, 5 & A6 all look boring in front of it and i can see it getting many many customers in India.
The Hybrid transmission does really help. My dad didnt like it as he's 65 but hey, how many 65 year olds are buying them these days. The 45 year old is the target customer for this car.
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Old 19th September 2018, 13:49   #13
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

Most members have echoed my thought in the above posts: Statistics are useless unless the sample size is big enough. It is like saying, 100% of the people in my room are scientists (my room essentially housing me alone). While the statement might be true, it does not help us in understanding the general population.
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Old 19th September 2018, 13:50   #14
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

Maybe its just a very cautious approach being taken by Lexus in India, but given the present line-up of Lexus' offerings in India, it shouldn't be a surprise that maximum customers for Lexus at the present moment are from the Toyota brand. Also isn't really an indicator of whether that's a good thing or worse. Also, not sure it the total number of cars sold so far, has been to Toyota's expectations (no use saying that out of the miniscule number of cars sold, 80% are from Toyota owners!!)

Rather than the Germans, the biggest competition Lexus faces today, with its current portfolio is from the Toyota Brand itself. Tha Camry makes a solid case for itself over the ES. Yes the ES is bigger and more powerful, but does it offer more value than the Camry? Same for RX and LX, one would rather buy a Prado (not comparable to RX though) or a Landcruiser. Today, the people who can afford cars from this price range are savvy and educated and would know what to pick and choose. Only the LS makes a little sense. However, to take on the 3 series and the C-class, the IS should have been offered and also the GS.


A small percentage of folks who would simultaneously own the Germans and experience the peace of mind/reliability of the Lexus cars over them, would eventually help to grow their footprint. But to establish the cars, to be of substantial reliability over the Germans, will also take about 5-7 years of overall ownership and more. But then, the demographic of the people who buy these cars, usually switch every 4-5 years, if not less. So the first owner is also most likely, to not benefit much, but the one's who buy pre-owned, which will dictate resale prices and the depreciation. So this brand establishment would certainly be time consuming (kind of the same that happened with Toyota's first offering in India - The Qualis)
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Old 19th September 2018, 14:01   #15
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Default re: Lexus: 80 percent of Indian customers are Toyota owners!

Quote:
Originally Posted by CrAzY dRiVeR View Post
- The existing customers for Luxury German brands hardly seem to have taken notice
They haven't but should because, (as same interview highlights):

Quote:
Another interesting statistic is that 60% of Lexus customers considered the brand because it was a hybrid.
Lexus buyers seem to gravitate towards the brand because of their experience with Toyota. 80% is a very high number. Couple that with the 60% statistic related to the hybrid makes it Lexus' USP then.

Given that Lexus hasn't exactly struck gold, that means:

a) Toyota/Lexus haven't been able to make the most of this - OR - India doesn't really care about hybrids yet. One big factor is price, of course.

b) Once the German 3 + Volvo come up with hybrids, where will Lexus stand?

The other thing: for a brand-neutral person shopping in that price bucket, Lexus isn't exactly being noticed.
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