Hybrid Car Review

Sales of the HS 250h, the first dedicated luxury hybrid from Lexus, is well below what Toyota had targeted (source: Ward). Initially, Lexus thought they could sell 25,000-30,000 HS annually. But after the rush of sales in Japan, Lexus started keeping more units in Japan, rather than shipping them to the US.  Lexus subsequently downgraded their target to 20,000-22,000 units annually.

"Right now, there’s so much demand for that product in Japan…maybe 20,000-22,000 might be more realistic," Mark Templin, Lexus Div. group vice president and general manager-Toyota Motor Sales U.S.A. Inc., told Ward’s in November.

But now the feeling is that target may have been a stretch.

"I think we underestimated the power of the Prius brand," he says, referring to the Toyota brand’s purpose-built hybrid. "And we overestimated what the market would look like based on gas prices. But if we can do over 1,000 units a month, 1,000-1,500 units a month, we feel really good about what we’re doing in the marketplace."

Since August, when the HS 250h first went on sale, Lexus has sold just over 11,000 units. So far in 2010, they are on target to sell under 14,000 units.

The HS 250h has been affected by more than just the Prius. The Toyota recalls have affected Lexus sales, and the soft market in auto sales has been lingering.