Speaking to Automotive News recently, Ted Ogawa, the new Toyota North America CEO has made some interesting admissions about the Lexus brand.
He said "I have no worries about the Toyota lineup, but in the case of Lexus, the cadence is an issue," Ogawa admitted. "So for this year, the LC convertible is new. Profit-wise, it may be OK, but in this sense, the Lexus dealer body wants to see more product sooner." This essentially means that Lexus needs to kick its new vehicle development into high gear to play catch-up. "
"We need to change the cadence and the product and the powertrain," he said. "Cadence is a planning concept, so that's a No. 1 priority. And then product, next to the powertrain, right now is a second order."
Ogawa also admits that the brand's rivals often rely on aggressive discounting strategies to get ahead. "Yes, product and the cadence, and No. 2 is the cost competitiveness. Aggressive incentives from German brands, in particular, are impacting the market. So we need to change the luxury market, which has been tough for us. Customers rely on the quality of our products, but dealers have issues with cadence. I can improve product and cadence because those are in my hands. But I cannot control the market, so that's very difficult, and I don't have the right answer yet for that."
Ogawa also admits that the brand's demographics are changing, which means Lexus must take action on that front as well. "Yes, our [average] customer is becoming older, so we need to rejuvenate, to make products that are more appealing to the younger generation. That is something that I will have to think about. Of course, an attractive product at an affordable price, so in the background, costs must be massively competitive. So we need to think about that, both with our suppliers and with ourselves."
Source: Automotive News
