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More on Lexus USA’s Future Strategy

In an interview with BusinessWeek, Toyota’s new North American chief Yoshimi Inaba shared his view that Lexus needs to be “redefined and rethought for the future”:

When it comes to Lexus, the issue is pretty clear: The luxury brand is far too dependent on just two of its nine models. The ES330/350 sedan and RX350 line account for two-thirds of sales. The GS sedan lineup—rear-wheel-drive sedans meant to take on German brands—haven’t caught on, selling just 3,500 cars this year.

Inaba sees two problems he needs to tackle: First, he says, Toyota has been making too many decisions about new models and designs in Japan. “We are becoming more regionally focused now and pushing decisions down to the places where the vehicles will be sold,” he said. To that end, several “global” job titles have been eliminated. Second, he believes Toyota’s vehicle designs must be jazzed up. “It’s been a fair criticism that our designs do not have enough excitement,” he said.

The fact that Toyota is moving away from a Japan-centric perspective is sure to bring some real change into the Lexus lineup. In fact, we may have already seen the first result with the announcement of a small Lexus hatchback, which is certainly directed straight at the European market.

It’s no small coincidence that the GS is used as the primary example of an underperformer, where the vehicle’s central issue is outlined by consultant Jim Hall:

The GS, notes consultant Hall, has been a very good sedan, but it takes on neither the BMW 3 Series 5 Series nor the Mercedes E Class in size, performance, or price. “It’s in the middle and that can be a tough place to be,” Hall says. “That car needs to take on one or the other in sales volume for Lexus to grow.”

One of the biggest knocks against the GS is the driving experience, and a push towards 5-Series performance would be a serious step in the right direction.

[Source: BusinessWeek]