A Luxury Hybrid: Lexus Shows off $104,000 'Green' Car

Lexus announces high-end luxury car; says it also protects the atmosphere.

May 17, 2007 — -- The Lexus LS 600h L shimmers in the light, does zero to 60 in 5.5 seconds, and has the equivalent of 438 horsepower under the hood. It has leather trim throughout, Bluetooth and voice activation technology, and a built-in navigation system.

The suggested price when it reaches the market this summer is $104,000 -- the most expensive car Toyota, through its luxury Lexus line, has ever sold.

And -- oh, by the way -- the company says it's environmentally friendly. The emissions from its tailpipe should be 70 percent cleaner than those from comparable cars. Toyota says the tailpipe emissions should be "cleaner than the ambient air in some major cities."

Do Green and Gold-Plated Match?

The LS 600h L is both a hybrid and a top-of the-line luxury car, for those who believe one can have it all. Lexus says it is trying to compete with such models as the BMW 7 series and the Mercedes-Benz S600.

But while the Mercedes, with its V12 twin-turbo engine, gets 12 miles per gallon in city driving, Lexus says its new car will have comparable power -- and get nearly double the gas mileage. (Under new EPA rules for 2008 models, the Lexus would get 20 miles per gallon in the city and 22 miles per gallon in highway driving.)

"We know there are a lot of luxury buyers who've said to us, 'Hey, I like my Prius, but what about a car with all the amenities I'm used to?'" says Greg Thome, from Lexus' U.S. headquarters in Torrance, Calif.

Environmental Chic

Keep in mind that Torrance is not far from another California town -- Hollywood -- where it's been fashionable to show up at the Oscars in Toyota's hybrid Prius instead of a limo.

There's a social statement that goes along with it -- passing on opulence for the sake of the environment. The Prius is rated at 60 miles per gallon in the city, though various reviwers say it gets in the high forties in real-world driving. And you can drive one home for about $23,000 plus taxes and fees.

In other words, you can get four Prius hybrids for the price of one new Lexus LS 600h L. The car comes from the same company, and, depending on whose numbers you use, may get three times the gas mileage.

So is there a market for a green car that costs over $100,000? Can you be green and gold-plated at the same time?

Toyota insists the answer is yes.

"We certainly feel there are people out there at many price points," says Thome.

At the new car's launch today in Tokyo, the company's president, Katsuaki Watanabe, said, "This car takes the concept of luxury beyond the conventional parameters and into the 21st century."

Others say that with its high price and less-than-impressive mileage, the new Lexus might be a hard sell to luxury consumers.

"In theory, it's a perfect combination -- luxury and hybrid -- and Lexus is one of the most purchased brands by wealthy consumers," says Pamela Danziger, the president of Unity Marketing, a boutique marketing consulting firm.

"But that's an awful lot of money to make yourself feel good about the environment," she adds. "That's almost four times as expensive as the Prius. People will look at that carefully and say, 'Does it really give me the value?' That remains to be seen."

Grant Lyons, who owns Firstride.com, an online store that sells hybrid cars, does not plan on selling the new Lexus.

"It's geared to middle-aged men who want to keep the style and comforts of their SUV while doing their bit for the environment -- a way to assuage their guilt without giving up the luxury," he says.

But Lyons calls it a step in the right direction, and says it become a status symbol akin to Apple's forthcoming iPhone.

"Everybody is going to want to have one -- a nice luxury toy that makes you feel good," he says. "And they're going to sell basketloads."