Lexus USA GM Mark Templin Talks Small Cars

David Shepardson of The Detroit News recently attended a reporter’s lunch meeting with Lexus USA General Manager Mark Templin in Washington, and came away with plenty of insight into where Lexus is heading.

The entire article is worth reading, but let’s focus on what Templin had to say about the possibility of Lexus releasing a sub-compact model:

[Templin] noted that Lexus won’t need to build small “A” and “B” segment vehicles to meet new corporate average fuel economy standards — because of Toyota’s fuel efficient models.

“If you look at it realistically, I think you’re going to see a big chance change in the luxury car industry over the next 10 years,” he said.

Other luxury makers may have to build large volumes of smaller vehicles to meet the [fuel economy standards of 54.5 mpg by 2025] requirements — meaning Lexus may not regain the title by choice.

“Unfortunately in the U.S. right now, there’s not a lot of consumer demand for really small cars,” Templin said.

He said consumers aren’t clamoring for luxury small cars — and he noted they aren’t very profitable. Templin said in the long term if Lexus doesn’t build very small cars it will “probably not” be the largest luxury brand in the United States.

“That’s not important to us,” Templin said, saying they’d rather be first in quality, value, customer experience and profitability.

As the article mentions, most other luxury auto manufacturers have no choice but to import their smaller European vehicles in order to meet the soon-to-be-strict fuel economy standards in the USA, which is a requirement that Lexus doesn’t have to worry about due to the efficient lineup of their parent company, Toyota.

For the time being, I have to agree with the strategy — for better or worse, American consumers just aren’t interested in small vehicles. In my mind, I can see Lexus creating an A or B segment vehicle for Europe (& Canada) first in order to better compete in that market, and then importing it into the U.S. once attitudes change (and as a huge proponent of a Toyota IQ-based Lexus, I sure hope I’m right.)

One other highlight from the Detroit News article:

[Templin] told reporters…that the company will see “a pretty sizable increase” in 2012 in sales — as Lexus introduces nine or 10 new or refreshed models.

Templin noted that many of Lexus models had been at the end of their lifecycle – and that 2012 will be a big year.

“It’s going to be a really intensive launch year for us,” Templin said. “Those products are coming with really exciting stuff… Everything is more focused on driving dynamics.”

I’m sure we can all agree, 2012 can’t come fast enough.

[Source: The Detroit News]

EuropeFutureHybridsIn the News
Templin is right on the small car doesn't made much profit ... good example for you is the Toyota iQ , it have to be expensive because it takes a LOT to develop !
The new ES, GS, and IS, all next year, will grow the numbers. The ES and GS will have hybrids, so that makes 5 new models. The CT may gain a gas engine. GS F-Sport. New ISF  And Rav4-based mini RX? BD 
  • S
  • November 10, 2011
I am really looking forward to the next generation ES and LS and IS. Wow, the entire sedan lineup is going to be refreshed next year. So much to look forward to!
    GS next year, not LS LS early 2013 BD
    • F
    • November 10, 2011
    LS is still fresh, after all it did beat the new 7 series, S-class, A8, Panarama & XJ in USA sales last month as usual..
  • F
  • November 10, 2011
Lol these small sub-compacts aren't even popular from the likes of Toyota, Honda, Hyundai etc etc Let alone people buying small sub-compact Mercedes, BMW etc.. In USA it won't happen.. And he is right about the profitability, cheaper cars are less profitable ..
  • Anonymous
  • November 10, 2011
Ummm.   Climb into one of those little gems.  Look like a monkey making love to
Lexu is a great car !)
LEXUS NEW LINE-UP CT (will add a RWD coupe on it based on the FT-86 plus a sedan version ) HS-deleted(replaced by CT-sedan IS-(the next 3rd generation will be found in 4 forms Sedan , Coupe , Cabriolet & Sport cross) ES-deleted GS-(with it's Amazing 4th generation the GS will add to it a Coupe variant as GS-C) SC-(will come back as a real 4 doors coupe to compete with 6-series , A7 & CLS) LS-(will got a coupe variant) with CT , IS , GS , SC & LS got both F and F-sport Variants  the next RX will share the IS chassis , the next GX will share the new GS the chassis with the all new small CT-X which shares the Rav-4 its Chassis & Engines last but not least the LFA will not be limited edition model and will sold with 100,000 $ less than the current model also it will got a convertible variant!!!!!!!!!!!
  • T
  • November 14, 2011
  • M
  • January 31, 2012
I recently bought Lexus CT 1200h.It is advertised to give 42 milesper gallon. However after driving nearly 900 mikles, the average is 36.3 milles per gallon.After 600 miles took the car to Lexus dealer. They checked it no comnes on gas mileage, except that the tire pressure was litltle low. This is after 3 weeeks of car purchase. Would like to kinow other owners experience. Mansoor A. Saifi