Lexus explains why it slashed more than $40,000 off the price of its electric SUV

Lexus Australia has attributed heavy discounting of its RZ electric SUV down to reduced manufacturing costs and increased competition, rather than over-inflated launch pricing.

The new RZ500e Luxury is priced from $84,500 before on-road costs, down $36,559 on the RZ450e Luxury it replaces, while the RZ500e Sports Luxury is priced at $91,000 plus on-roads – a markdown of $42,059.

Those are reductions of just over 30 per cent, and follow similar – but far less substantial – cuts made to the prices of the RZ’s Toyota bZ4X and Subaru Solterra platform-mates with their latest updates.

However, Lexus Australia doesn't think it got RZ pricing wrong the first time around.

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"I think there's a number of contributing factors that go into the price repositioning in terms of battery technology and production efficiencies," Lexus Australia CEO Jack Hobbs told CarExpert.

"Three years has been a long time, actually, and we've seen lots of improvements over that period.

"The market is also shaping and moving the direction of where a vehicle like this is best placed."

Local RZ sales fell off a cliff last year, with just 41 finding customers after a combined 480 examples were delivered across 2023 and 2024.

However, Mr Hobbs expects the RZ to attract far more attention this year given its renewed price-competitiveness and an uptick in EV interest.

"We're excited to have the RZ as it stands, because it really does fit that nice battery electric option for our customers, and we think it has broader appeal at the price point that we've been able to offer," he said.

"There's been some global events that are reshaping the market, and certainly we've seen enquiries improve in BEVs, as well as plug-in hybrids and even hybrids, to some extent. In that sense, we're also very excited."

Despite considerable price cuts, the updated RZ boasts better technical specifications and more standard equipment than before.

The dual-motor all-wheel drive RZ500e produces 50kW more than the outgoing RZ450e thanks to revised electric motors, bumping total power to 280kW. Torque is unchanged at 537Nm.

There’s also a larger-capacity 74.7kWh battery, up from 71.4kWh, yielding a 16 per cent increase in WLTP range to 460km. The AC charge rate has also been doubled to 22kW.

Lexus says the RZ has received additional bracing and body rigidity measures, as well as retuned dampers and springs front and rear, plus measures aimed at reducing noise, vibration and harshness.

Improvements to existing RZ models have been supplemented by the introduction of a new, range-topping RZ550e F Sport variant, priced at $105,000 excluding on-roads. It’s the only RZ to not slot in under the Luxury Car Tax threshold for fuel-efficient vehicles, with the Luxury and Sports Luxury now eligible for Fringe Benefits Tax (FBT) exemptions.

MORE: Explore the Lexus RZ showroom