Lexus 460: More Luxury for Less

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High Drag Coefficient

The LS 460l is rated to get 18 mpg in the city and 27 on the highway. In 369 miles of largely highway driving, I got 20.7 mpg. One reason mileage is so high on the highway is that the LS 460 has a co-efficient of drag (a measure of how slippery a car's exterior is) of just 0.26, one of the lowest such ratings of any vehicle.

However, if that combination of power and decent mileage isn't good enough for you, wait a year and buy the hybrid LS 460h L. The company promises it will not only have the luxury appointments of the gasoline-powered version but the speed and power of a V12 engine and fuel efficiency that "will equal or better the combined fuel-efficiency ratings of smaller, V6, all-wheel drive mid-sized luxury sedans."

Lexus expects to sell about 30,000 LS 460s this year and figures the 460l will account for about 30% of that total. The new model is already off to a good start. Lexus, like Toyota, had its best January ever, with U.S. passenger car sales up 18.7% to 13,574 units. LS sales soared 142.5% vs January, 2006, with sales of the LS 460 hitting 3,006 for the month. The average LS 460l spends a mere eight days on a dealer's lot before selling, according to The Power Information Network.

Behind the Wheel

For such a big vehicle, the LS 460l is scary fast. Lexus says the regular LS 460 can jump from 0 to 60 in 5.5 seconds but I figured the long version would be slower. I was wrong. The 460l weighs 4,332 lbs, just 88 lbs more than the 460, and it's equally fast. I consistently got 0 to 60 times of 5.4 and 5.5 seconds in the 460l, which about matches the lightening speed of the Mercedes S 550 (see BusinessWeek.com, 5/10/06, "The New S 500: Sportier, Sexier, More Expensive").

Out on the highway, the LS 460l is so quiet and smooth you often find yourself going far faster than intended. When I first started driving the car I found myself going as fast as 110 mph without realizing it. The car felt as smooth and quiet over 100 as it did at 65. Even after (in the interest of avoiding speeding tickets) I began to be more careful, I regularly found myself inching up to 85 or so, unaware that I was going so fast until I glanced at the speedometer. When you have to pass, or accelerate out of a dicey situation on the freeway, you feel confident that this car will perform any reasonable task effortlessly.

The eight-speed automatic is incredibly smooth and helps increase the Lexus' fuel efficiency. But you have to wonder why Lexus just didn't go with a continuously variable transmission, which doesn't shift at all?

In normal parking situations the Lexus is easy to maneuver because its 36-ft. turning radius is far shorter than that of any of its main rivals. And believe it or not, Lexus' self-parking system actually works once you get the hang of it. (Forget about the TV personalities who had trouble with it—they either never took driver's ed or didn't read the instructions.) I didn't want to risk denting a stranger's car so I set up my own cars on the side of the road to test it out. I needn't have worried. The car steers itself when parking, but the driver controls the brake. So, if something goes wrong you just hit the brake and start over.

Not In New York

Basically, you just get the car in place as you normally would, next to the car you want to back in behind. Graphic indications appear on the little video screen and when you're lined up properly, the car backs itself into the spot. I even tried it in a heavy snowfall on a slight incline. The main catch is to use the brake to keep the car moving very slowly. Then if you line it up correctly, it usually backs right in.

How useful the system is debatable. For it to work, the parking space needs to be about six feet longer than the car. You'd really have to be a lousy parallel parker not to be able to get into a space that big. The system is no help at all in say, Manhattan, where you typically have maybe two feet of extra room at best, and where there's usually a taxi honking at you to hurry up and park and stop blocking the road.

As with other Lexuses, the new LS's cabin is intelligently designed and made of attractive, high-grade materials. The controls on the navigation system, sound system, and other gewgaws are a lot more intuitive to use than on a BMW. There are numerous thoughtful features you notice over time, such as the fact that the rearview mirrors tuck in against the car automatically when you shut off the engine.

However, I have a few bones to pick with the car's design. I found legroom in the front seat surprisingly tight, for one thing. At 5 ft. 10 in. tall, I didn't have to stretch to reach the pedals, even with the driver's seat all the way back. Another nitpick: The LS 460l normally has 18 cubic feet of trunk space, which is plenty, but that shrinks to just 12 cubic feet when you go with the optional rear seat air conditioning.

Finally, I don't know about anyone else out there but I find the LS 460's styling too bland. It looks too much like a generic luxury car to me.

Buy It Or Bag It?

The Lexus LS 460l offers a lot of value when you compare it to the competition. The LS 460l starts at $71,715, and tops out at around $98,000 (including the Executive Seating package). The only model in the same category that's cheaper is the long version of Ford's (F) Jaguar XJ8 (see BusinessWeek.com, 7/1/05, "A Jag That Roars—and Coddles"), which for '07 starts at $67,750 and tops out at about $76,350. I like the big Jag a lot, but it doesn't seem as refined or technologically advanced as the 460.

If you stick with a V8 engine, the German competition costs more than the Lexus if you load up on options. Here are the comparative numbers I came up it for rival German models when I loaded them up with options:

The '07 Audi A8 (see BusinessWeek.com, 9/22/06, "Audi A8: Autobahn Burner") starts at $73,600 and costs about $106,000 loaded up with options (though that includes all-wheel drive, which the Lexus doesn't have); the BMW 750li starts at $78,795 and tops out at about $115,000; DaimlerChrysler's (DCX) Mercedes S 550 starts at $87,525 and goes to about $117,000. (Of course, if you opt for a 12-cylinder engine on one of the German cars, the sky is the limit—the base price is way over $100,000).

The price differences are less pronounced but the Lexus is also at the low end in terms of the real world prices people are paying for the car. The average recent price paid for the Lexus LS 460l is $81,988, about $1,000 more than the average price of the Audi A8, according to the Power Information Network. By comparison, the BMW 750Li is selling for an average of $84,649, and the Mercedes S 550 for $94,018, Power says. (Like BusinessWeek Online, The Power Information Network is a unit of the McGraw-Hill Cos. (MHP).)

If you test-drive these cars against one another, you may end up preferring the looks of the Mercedes or the edgy driving characteristics of the BMW and Audi. But dollar for dollar, feature for feature, Lexus has set a new standard for luxury cars.

Click here to see more of the 2007 Lexus LS 460l

Thane Peterson reviews cars for BusinessWeek.com.