A fun new GS 350 from Lexus

Lexus has been the brand for mature, responsible, and with lots of money adults.  The average age of Lexus owners are reaching the upper end, around 59 years of age at this time and it was around 60, a year earlier.  Until 2011, Lexus was the best-selling brand in the U.S. when BMW took over.

With its new GS 350, Lexus is trying to appeal to a younger generation.  Its luxury package includes 18-inch wheels, a softer suspension, and with an excellent standard brakes.  These make the car more mainstream and show a new direction for Lexus.  The GS comes with 306-horsepower V6 engine; six speed automatic transmission; driving mode selector for normal, eco, and sports + settings; and ability to hit 60 mph in 5.7 seconds.  The rear-wheel drive is priced at $57,309 with options and has a city/highway combined mileage of 23 miles per gallon.  The all-wheel drive cost additional $2,550.

The car with LED-surrounded headlights and a semi-trapezoidal grill looks ok from the front.  However, the side look is bland.  Inside look is rich with leather.  Seats are comfortable for a long drive.  Trunk has a 14.3-cubic foot of storage space.  Dash board is logically laid out with as usual complicated infotainment system.

The U.S. government’s hold on General Motors continue

During the 2009 economic crisis, the U.S. government spent a total of $51 billion to bailout the General Motors.  Through sales of stock, the U.S. government has already recouped $24 billion of its investment.  The remaining stake of the U.S. government in General Motors worth over 500 million shares and the government is unlikely to sell at a loss due to the current depressed stock price.  If the government sells its shares at current stock price, it will lose over $14 billion of its investment.  So, the government control of one-third of shares outstanding and the company continues.

The U.S. government owns more than 32 percent of the company.  In order to recoup its remaining investment, the stock price has to be around $53 a share but GM shares are selling around half of that.  Either the government sell at a loss at this time, continue to sell smaller portions or even wait until the price somewhat recover.  This is a drag on GM who is trying to get out of the government control.  Recently it took $11 billion credit line to raise funds to buy back government owned shares.  In the meantime, GM sales are slumping especially in the Europe.