Lexus' loss, Genesis' gain? Why Genesis G70 could be the big winner after the shock Lexus IS axing

Genesis could become the big winner of Lexus’ shock decision to axe its popular IS mid-size sedan. 

At the start of this month, Lexus announced it will stop selling the IS, along with the RC coupe and CT small hatchback, due to changes to local safety regulations.

While sedan sales have been in decline, the mid-size premium segment remains steady and is actually up 20 per cent year-to-date, to the end of June 2021.

The departure of the IS leaves a sizeable gap in the market, with the IS being the third best-selling model in 2021, behind only the Mercedes-Benz C-Class and BMW 3 Series, with more than 700 units sold.

Which brands will pick up those sales will be interesting to watch when the IS become unavailable from November this year.

There are some obvious candidates that will be hoping to pick up would-be IS buyers, notably the Audi A4, Volvo S60 and Alfa Romeo Giulia. 

However, arguably the best candidate to benefit is Genesis, with the Hyundai-owned premium brand the most similar in concept to Lexus, while the G70 is a very similar model to the IS in both concept and price.

The G70 range consists of the 2.0T at $63,000 (plus on-road costs) and the 3.3T Sport priced from $76,000, which line-up nicely against the IS300 Luxury at $61,500 and the IS350 F Sport at $75,000.

In a case of good timing, the facelifted G70 has just gone on sale, and the GV70 mid-size SUV is about to launch, which should bring more attention to the brand plus Genesis is expanding its local retail presence.

The second Genesis Studio in Australia has recently opened in Melbourne’s Emporium shopping centre, joining the original Sydney ‘studio’.

A third location is planned for Brisbane in 2022, but before then ‘Genesis Test Drive Centres’ - which are more like traditional dealerships than the Apple Store-like Studios - will open in Melbourne, Brisbane and the Gold Coast before the end of the year.

Sales of the G70 have been slow to date, with only 44 sold so far in 2021, but the brand is targeting a major jump in total sales by the end of the year.

Genesis is hoping to triple its sales total from 2020, which would mean a jump from just over 200 sales to about 600 or more.

While the GV70 is hoped to attract a significant proportion of those new sales, if the G70 can appeal to potential Lexus customers, it would help the brand’s growth significantly.