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Lexus has a similar issue to Mercedes-Benz with the stereotypical target buyer seen as being a more mature buyer than say BMW, which strives to breath sportiness into the heat of every one of its cars. The new Lexus CT 200h will soon be here to address that issue.

According to Lexus’ European head Andy Pfeiffenberger the Lexus CT 200h full-hybrid hatchback is expected to win over younger drivers, thanks to its advanced modern design.

We anticipate that a whole new audience will respond positively to the CT 200h’s dynamic styling, the latest evolution of Lexus — L-Finesse design — has given the car a real contemporary appeal to attract design-conscious, younger customers,” Mr Pfeiffenberger told reporters at the Geneva auto show.

It will be interesting to see if their predictions are correct given the Lexus CT 200h is based on the Toyota Prius. It uses the same 1.8-liter petrol engine with a electric motor combination and can drive for up to 2km on electricity alone. We suspect it will also have the same 3.9L/100km fuel economy depending on weight.

“It is the right car at the right time. The compact premium segment became the largest in the premium market last year. The European buying public want smaller, less-polluting cars – but without any comprise on refinement and driving pleasure,” Pfeiffenberger said.

Lexus says the CT 200h will soon go into production first for the European market and then a release worldwide. The new entry level Lexus is destined to take on the BMW 1 series and the Audi A3.

Prices in Europe will start at about 21,000 euros (about $32,000) but no doubt it will cost more here once our taxes are added on.