Luxury discounts rise as Lexus, Mercedes, BMW fight for sales crown

U.S. consumers are getting better deals on luxury cars and SUVs this year as the top brands clear out old models and race to be No. 1 in sales.

Toyota Motor Corp.'s Lexus has led the rise in customer incentives. Lexus boosted discounts on its cars by 54 percent this year and its SUVs by 60 percent, according to researcher Autodata Corp.

Mercedes-Benz increased incentives 11 percent and BMW AG by 6.9 percent, compared with a 2.2 percent gain in industry-wide promotions.

"You have these three brands that are all very close to one another and that's going to put incredible pressure on pricing," said Tom Libby, lead North American analyst for R.L. Polk & Co. "That's going to cause incentive wars. "

Lexus was the top-selling luxury-auto brand in the United States for 11 years, until BMW took the crown last year.

Mercedes leads BMW by fewer than 2,000 vehicles through May and Lexus by more than 18,000.

All have increased deliveries faster than the total U.S. light-vehicle market's 13 percent gain.

Lexus sees little chance of winning the U.S. sales race this year, said Mark Templin, Toyota's U.S. Lexus chief.

The brand's goal is for 250,000 U.S. sales this year, less than 1 percent more than BMW's 2011 results. BMW sales are up 14 percent so far this year.

Regaining the sales title would be a goal "if possible," Kazuo Ohara, senior managing officer for Lexus, told reporters in February.

"Spending is up this year because last year we didn't have anything to sell," Templin said. "If you go a year from now, in terms of incentives, you won't see big growth."