In 1983, Toyota Chairman Eiji Toyoda called a secret meeting of company executives asking them a question that would change the luxury segment as we know it today. “Can we create a luxury vehicle to challenge the world’s best?”
“Back when it started, there were a lot of questions whether Lexus would work or not,” Dave Illingworth, a senior vice president at Toyota who was in charge of Lexus in its first stages, told The Detroit News.
Now, within 11 years, Lexus’ has become the best-selling luxury brand in the United States. Toyota now hopes to continue that success around the world and transform the premium brand originally made for the U.S. market into a global luxury name to rival Mercedes and BMW. Currently BMW’s and Mercedes-Benz’s sales are twice that of Lexus’.
However, Lexus is off to a slow start as it expands into growing markets such as Russia and China. Even in its home turf, Lexus missed its sales target in 2005 and 2006 when it was introduced two years ago. However demand is starting to pick up with the new LS sedan.
Lexus’ biggest problem is Western Europe, the world’s number one luxury car market and. The Japanese luxury auto maker sold less than 37,000 vehicles in Europe as compared to the 322,000 units it sold in the U.S. Since most Lexus customers in Western Europe have leaned towards the RX hybrid, Lexus hopes to offer the region more hybrid variants of its models to gain more market.
Now the question is whether Lexus should adapt one global strategy or cater to a regions needs as they see fit. Yuki Funo, a member of Toyota’s board , said he thinks Lexus should aim for one global identity. Stating the main difference between Toyota and Lexus, Funo believes that localization is the wrong approach. “We have to maintain the identity of the brand. That’s different from Toyota, which should be localized. Lexus should be global.”
So what”s in the works for Lexus in the next couple of years? Well you already know about the Lexus IS Coupe and Convertible coming by 2009, but Lexus is hard at work developing a small SUV based on the RAV4 to compete with the BMW X3 and the upcoming Mercedes GLK. The long awaited seven-seater crossover is also expected in 2009.
Lexus is also working on a dedicated hybrid-only model that, according to Steve Settle who is the head of Lexus UK, will be one of Toyota luxury brand”s least expensive hybrid when it arrives in 2009. The Lexus hybrid-only model will be slightly roomier than the current IS lower-premium sedan.
Source: The Detroit News
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