Lexus lost more than other premium brands from leaving the Russian market last year, its sales in the European region declined as a result of this departure by about a third. Now the situation is improving, sales are growing, and in 2024 Lexus plans to fully compensate for the loss of Russia from its sphere of interests.
The main market for Lexus was and remains the United States, but Russia occupied an important place in the sales structure of the Japanese premium brand, not so much in terms of volume as in profitability: Russians bought high-margin models (the most popular was the RX crossover) and spent a lot of money on servicing them in conditions of the harsh Russian climate.
According to the results of the last full legal year of operation, 2021, Lexus, according to the AEB, sold 19,362 cars in Russia. Lexus sales in Europe in 2021, according to ACEA, amounted to 47,604 vehicles (Europe in this case means the European Union, Great Britain and countries that are members of the European Free Trade Association).
The business publication Automotive News Europe, citing Lexus Europe director Matt Harrison, reports that last year was very difficult for the brand in Europe, when its sales decreased by 30% to 50,467 units. (in this case, we mean the geographical region that includes Russia), but Lexus plans to finish 2023 in the region with a result of 74,000 cars sold, and next year it will sell more than 90,000 cars and break the 2019 record.
The optimism of Lexus management is inspired by the almost doubling of demand for the compact crossover NX this year and the most affordable subcompact SUV in the range, the Lexus LBX, which debuted last summer (in the title photo) – it should sell at least 25,000 copies per year.
Meanwhile, Lexus management admits that if the brand can make up for quantitative sales after leaving Russia relatively simply and quickly, then achieving the level of profit that the Russian market provided will be much more difficult. The problem here is not only that Russians bought more expensive Lexus models than what Europeans buy today, but also that Lexus in Europe does not have such a strong aura as in Russia, the competition is very high, including from on the part of Chinese brands advancing on the European market – such as Nio and Zeekr.
Europe is also now demanding more electric vehicles from automakers, and Lexus in the EV segment still has a very modest offer, and in all markets, and not only in Europe. Japanese companies frankly slept through the electric car race and are now trying to catch up with discounts and launching more affordable versions of their models. The development of new, more competitive electric vehicles of the new generation requires time and money, while the Russians willingly bought what they had and did not require any costs from Toyota and Lexus to meet their specific consumer needs.