As Lexus Limps, BMW and Mercedes-Benz Gun for First Place

Lexus executives may have officially given up hope of nabbing the U.S. luxury-auto sales crown for 2011, but the top contenders for the prize are revving their engines. Mercedes-Benz slightly narrowed BMW's lead in October, to about 7,000 total vehicles from about 8,000 vehicles through the end of September.

Luxury-segment sales have trailed the growth in overall U.S. auto sales so far this year, in large part due to the supply disruptions for Lexus, Acura and Infiniti (which is launching production in China next year) because of the March natural disaster in Japan.

Both camps play down their sprint to the finish. "If we beat BMW, I'm not going to say I wouldn't be happy, but it's not our target to beat them," Mike Slater, vice president of sales operations for Mercedes-Benz USA, told brandchannel. "We don't focus on that. If one day we happen to be Number One, that'd be nice."

But regardless of what BMW and Mercedes executives say (or don't say) about it, we're in for a torrid finish. Both brands have been nearing 200,000 sales for the year, with Mercedes posting its highest October volume on record. As always in the auto industry, new products goose sales more than anything else, and on that score both BMW and Mercedes have been giving showroom shoppers plenty to look at. BMW has its new 528i and the full lineup of its new 6 Series. Meanwhile, Mercedes touts an all-new C Class compact sedan and M Class midsize crossover vehicle.

Another element of the competition is ever-rising levels of incentive spending. BMW, for instance, led the U.S. industry in incentive spending in October with an average of $3,434 per vehicle, according to Edmunds.com.

Other rivals are enjoying the spectacle. "Who wants it more? That seems to be who's willing to discount [prices] more," C.J. O'Donnell, group marketing manager for Lincoln, told brandchannel. "It's an interesting squabble. I'm not sure it means much from a business point of view, but someone wants to be on top each year, and they work to do it."