I could take your point the IS is not China friendly at the moment but that could be the exact reason why Lexus want to make it in China: to receive exact same treatment as BMW 3-Series. The current IS does not sell because it is the original BMW 3 in Lexus badge. Making a longwheel base version will help a lot. Why do they want to make the hassle? Because the target audience for IS and BMW 3 is critical to their success in China: young, affluent and adventurous owners who love to try new things and will probably stick to the brand when they get older.Probably next year.
Chinese auto press are consistently unreliable when it comes to rumors. We've been hearing about the Corolla getting the BMW B38 (1.5t Inline-3) since 2015 except it's not happening. They predicted last year the new GA-L Crown will be produced at FAW when there was solid information on Avalon replacing the Crown. They even reported end of Prado production when that thing is selling 5k per month (although the recent facelift is a major flop and end of production could be a possibility). So I will consider the IS rumor BS with maybe 0.2% credibility.
The IS is the most 'un-China' car you can imagine due to its abysmal rear legroom. They would have to make an IS-L that will basically be the spiritual successor to the GS. Oh, wait, that may actually be a good idea.
Anyway, seeing how the 'unattractive' 6ES is now consistently a best seller, they will have zero incentive to produce 7ES at FAW in the short term. The only way I can see a made-in-China Lexus is after 2022, when China completely removes restrictions on percentage of ownership in the JV (currently 50%) for foreign automakers. That way TMC can have maximum control over every Lexus vehicle produced.