• Mar 22nd 2008 at 4:02PM
  • 12
In trying to establish a Japanese-market foothold for Lexus, Toyota has seemingly fallen prey to the same tactic that made the Cadillac Cimmaron such a maroon. When trying to launch a brand, especially an upscale brand, it's not advisable to rebadge existing models and crank up the price. It doesn't seem to matter how good the car is, or how swanky the new $10-million-a-pop showroom is, once an Altezza, always an Altezza, and paying 20 percent more for the same car with a different logo is rightfully galling.

Japanese luxury car buyers also have quite a taste for European iron, specifically German cars from the likes of Audi, BMW and Mercedes. Enthusiasts in Toyota's own backyard echo the universal car-guy complaint that Lexus vehicles lack personality. There's no denying that Lexus cars are well-made and capable, and the IS-F may finally infuse the brand with enough attitude to woo buyers of storied marques. Currently, most Lexus buyers in Japan are stepping up from Toyota ownership. Less than 5 percent of sales are conquests, and actual sales have lagged behind projections. Lexus offerings have been expanded from the initial IS, GS, and SC models to include the LS, and the RX will be coming in 2009. While it may appear less than successful so far, Toyota can afford to be patient. American buyers have fully embraced Toyota and Lexus nameplates to the point where they're both smashing successes. In another two to three years, we're betting Lexus will have a cheery song to sing in Japan.

[Source: Businessweek]

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    • 1 Second Ago
      • 7 Years Ago
      Few things:
      - Toyota has Crown brand in Japane, which is IS/GS competition and outsells both MB and BMW together.
      - LS is now half of Lexus sales in Japan :-).

      They only sell IS/GS/LS/SC in Japan.
      • 7 Years Ago
      The article omits the fact that Lexus brand is badged as Toyota in Japan which is a major factor in reducing the Japanese buyer appetite.
        • 7 Years Ago
        Do you live under a rock? The Lexus brand has been available in Japan since 2005. It's funny you say "The article fails to mention". READ THE ARTICLE CAREFULLY and it'd tell you that Lexus cars are sold in Japan as Lexus cars.
        • 7 Years Ago
      • 7 Years Ago
      Tagg, I don't buy your argument about the Japanese government having more strict import standards... their emissions and crash test standards are no worse than Europe or North America, and German cars aren't horribly more expensive than in North America. (In fact, they're cheaper than the equivalent models in Canada...)

      Japan IS protectionist regarding several industries, but they're almost universally industries where Japan has little chance of competing on its own merits... mining, agriculture, etc.
      • 7 Years Ago

      Any one know how well Cadillac is doing in Japan? For that matter are Cadillacs sold in Japan?
      • 7 Years Ago
      That's because they know what it is. A glorified appliance from Toyota. But--they knew we in the US would buy it. Why? Because when it came out it looked like a Mercedes for less money and Americans like cheap, that's how Wally World became the #1 employer in the US.

      • 7 Years Ago
      Hmmm, very interesting article. Total quality management practices did not become popular until Japanese companies embraced improving quality management- business practices.

      How is quality linked to an organization's strategic plan and strategic objectives? Who has the ultimate responsibility for quality assurance? (government, politics, management, consumers...perhaps.)

      I think Toyota/Lexus luxury brand will do well in Japan. I think markets in Japan are interesting to study. I think Japan has a rich/traditional cultural identity.

      I do believe today's younger generations in Japan are attracted to other car companies/markets because of it's uniqueness. Cultural diversity...

      Vehicles such as Audi, BMW, Porsche, Aston Martin, Mercedes, Infiniti, Acura, Cadillac and others are great luxury vehicles that performs well.

      I think as a company continues to branch out into broader markets around the world, the acceptance of it's products and sevices may ultimate depend on quality.

      Very interesting article...
      • 7 Years Ago
      The Japanese simply know it's just over priced.
      • 7 Years Ago
      This is why Toyota and Honda are full of win. Japanese consumers will stand for nothing but the best, and so in order to sell vehicles in Japan, you have to be the best.

      GM, Ford, and Chysler would have started getting better a long time ago if consumers had come around sooner and stopped pitying them simply because they are American Companies.
        • 7 Years Ago
        It doesn't hurt that the Japanese government has some very strict import standards to protect their industry either.

        I don't disagree with you about the Japanese demanding very high quality but the U.S. is no slouch either when it comes to quality. I say that with confidence because that is the reason you don't see any Fiat's or Renault's here anymore.

        Lexus fails in Japan because they simply do not buy into the marketing that you can't have a really nice Ford or Chevy. You have to have a Lincoln or a Cadillac to because a Ford or Chevy just isn't good enough because of the badge.

        Need proof? Google VW Phateon and you'll see it.
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