Lexus’ UX will test market for flexible lease options

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The Lexus Complete Lease package on the UX is aimed at attracting first-time luxury buyers. Photo credit: Krishnan M. Anantharaman

SEATTLE – The "all-inclusive" lease package that Lexus offers on certain markets, with its new UX subcompact crossover, will be a test of how many new luxury customers are willing to pay for simplified, flexible alternatives to ownership.

The Lexus Complete Lease, announced last month, is a two year lease program, 20,000 miles for the UX with insurance, maintenance, tire and wheel protection and telematics services in one payment. The add-ons have fixed prices, but Lexus said the total monthly price will be set by dealers in the selected markets.

"For us it's really important that the dealers are the ones, first and foremost, to work with the customer, because that's where the relationship is," said Cynthia Tenhouse, general manager of Lexus for product and consumer marketing.

Lexus has not identified the insurance provider. The other products come from the financial department of Lexus.

The Lexus Complete Lease services package is similar to that of Volvo's Care by Volvo, a flat-rate plan that costs $ 600 to $ 700 per month for the XC40 compact crossover. The Volvo deal also includes a trade-in option after 12 months, a higher mileage allowance and the possibility to order the pass online.

The Lexus program is aimed at attracting first-time luxury buyers who have the flexibility of a shorter commitment and a simpler payment structure. It will initially be available in the Los Angeles, Boston, Chicago and Miami areas. Those cities have the highest rental penetration in all of Lexus' business regions, told Tenhouse Automotive News on a media preview here.

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"If we feel that we feel like it, we will definitely expand," she said.

& # 39; Move-up & # 39; buyers

Lexus executives talked about the UX as a candidate for a kind of subscription, which they say are still being formulated for a small pilot project.

Competing brands such as Cadillac and Porsche offer their customers the option to pay a fixed monthly fee of up to $ 3,000 for access to a range of vehicles with the privilege of exchanging vehicles from time to time. But such schemes are usually too expensive for the target customer of the UX, which according to Tenhouse is usually a first-time & # 39; upward & # 39; is a luxury buyer.

"I do not think we are convinced that a subscription is the only way," she said. "There are different methods of ownership, so we felt that convenience is the most important thing for this buyer: convenience and value are going to outdo everything."

At the same time, she said, Lexus would not want to make the short-term lease program "attractive" in price.

"We want to know what the threshold is for this," she said. "It must be well priced."

Lexus raises the UX among young, urban customers or people with a city-centered lifestyle, promoting the limited turning circle; standard Apple CarPlay; safety devices that can detect and brake pedestrians or cyclists; and a mobile app that brings Amazon's speech-driven capabilities into the vehicle.

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Lexus has ruled out that it is under the $ 30,000 price for its entry-level products and strictly adheres to that policy for the UX. It will compete against crossovers of the three major German luxury brands – the Mercedes-Benz GLA, BMW X1 and Audi Q3 – and the Infiniti QX30.

December arrival

The basic petrol powered UX 200 model, which will arrive at dealerships in December, starts at $ 33,025, including shipping, with an F Sport package that adds $ 2,000. It comes with a 2.0-liter inline four-cylinder engine coupled to a continuously variable transmission with a fixed first gear.

The hybrid four-wheel drive model that arrives in January starts at $ 35,025, including shipping, with the same available F Sport upgrade. It uses the same 2.0-liter petrol engine along with a pair of engine generators for the hybrid system. The awd function, supplied by the second motor integrated into the rear differential, is expected to increase the speed of the hybrid model.

Lexus said the UX 250h hybrid EPA rated fuel economy of 39 mpg combined is the highest of any viaduct without a plug.

The UX fills a keyhole in the line-up of Lexus utility vehicles, including the popular RX mid-size and NX compact crossovers, plus larger SUVs that focus on the body. This year the brand finally got a crossover with three rows.