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Lexus sees drop in premium market share

Belinda Poole, the head of Lexus GB, is looking at ways of making the business more profitable for dealers.

The move comes as Lexus’s revealed the network is averaging a 0.3% return, dragged down by some outlets which are loss-making as the premium brand suffers from the product onslaught of its German rivals.

Its share of the premium market has dipped to 2.2% from 3.8% in 2007, when it sold a record 15,119 units.

This year, the brand is targeting 8,000 registrations, around the level it achieved nine years ago.

Long-term, its future looks brighter as the product focus shifts from US market demands to meet European customers’ desires. The IS range has just gained a sub-150g/km emissions model. The RX450h arriving later this year will also be below that threshold, and a C-segment model is likely within two years.

But short-term, the Lexus GB team, led by Poole, is working to help dealers improve performance and profitability in the areas where they can make a mark – aftersales, used cars and customer retention.

“From the retailers perspective we’re looking at how to make it a more profitable business model for them,” said Poole. She has looked at specific key performance indicators for dealers, including used cars, service absorption, generating retail aftersales work and winning back lapsed customers.

The network has decreased to 50 centres. Lookers’ outlets in
Southend and Brighton and Arnold Clark’s in Aberdeen dropped new car sales to become authorised repair centres in the last year.

Poole said: “The rest of the retailers will remain stable. The centre network has to be at the right size
to provide the right geographical coverage for our customers.”

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