Mercedes Poised to Pass Lexus for U.S. Market Lead

TOKYO - Daimler AG's Mercedes-Benz may take over the top position among luxury brands in the United States after a decade of dominance by Toyota Motor Corp.'s Lexus, Bloomberg reported. The Japanese carmaker has been marred by record recalls this year for flaws across its lineup.

In the first half of this year, U.S. deliveries of Lexus models grew 19 percent to 107,430, while Mercedes-Benz jumped 25 percent to 106,972. The figures do not include Mercedes' sales of its Sprinter commercial van.

Lexus's market share may dip to 1.98 percent this year from 2.1 percent in 2009, falling behind both Mercedes-Benz and BMG AG, according to auto-industry researcher Edmunds.com. BMW, the world's top-selling luxury auto brand, sold 100,632 units this year through June in the U.S. market.

“It's very likely Mercedes-Benz may take over the lead this year,” said Jesse Toprak, vice president of industry trends for researcher Truecar.com in Santa Monica, Calif. “The cumulative impact of all the recalls hasn't really shown up yet. It's more likely to be seen in the second half.”

Problems including fuel leaks, engines that may stall and vehicles at risk of rolling over during emergency driving maneuvers surfaced after Toyota had already recalled more than 8 million vehicles under its main brand for defects linked to unintended acceleration.

“It will be a battle,” Jim Lentz, president of Toyota's U.S. sales unit, said in an interview in Torrance, Calif. “The Lexus customer is really discerning about quality issues.”

Jessica Caldwell, a senior analyst at Edmunds.com, said Lexus, Mercedes and BMW are "really neck and neck” in the U.S.

“There is a big opportunity there for the Germans,” she added.

Lexus's U.S. sales growth dropped to 2.7 percent in June while Mercedes-Benz, the second-biggest premium vehicle line globally, posted a 25 percent gain and BMW delivered 15 percent more cars.