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Ramping Up For The Kill? Lexus To Increase Production By 35%

Agent009 submitted on 2/27/2008 Official Bell & Ross Timestamp: 12:17:54 PM

73 user comments | Category: Misc News | Source: | SOURCE: www.reuters.com

Toyota Motor Corp will boost production capacity for its Lexus luxury cars in Japan by about 35 percent in 2009 to meet growing demand in emerging countries such as Russia and China, the Nikkei business daily reported on Wednesday.

Japan's largest automaker will increase annual output capacity to about 850,000 cars in 2009 by adding equipment at two domestic plants, the newspaper said.

A spokeswoman said no such decision had been made.

The plants in Aichi and Fukuoka prefectures currently have a combined capacity of 600,000 cars a year, and Toyota aims to increase that to 630,000 this year, the Nikkei said.

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as long as Toyta can make money they are going to build as many as they can, they are the 21st centuary GM...
— pchera01 (View Profile)

Posted on 2/27/2008 12:42:43 PM | reply to this comment | Votes: 3

"Lexus doesn't sell econoboxes..."

Many of your Lexus fanboy friends classify a BMW 318i or Mercedes C220 CDI as an "econobox". They seem to forget that Lexus makes an IS220d "econobox" too.
— Willis (View Profile)

Posted on 2/27/2008 1:03:14 PM | | Votes: 7

Xero,

In Europe the A class and 1 series are not viewed or even considered econoboxes, as is my understanding. Given their price tag they're considered premium cars. I believe owning a small premium car is considered trendy in Europe. Just like teenage girls here "need" to drive a BMW 3 series or a Lexus IS.
— Willis (View Profile)

Posted on 2/27/2008 1:10:12 PM | | Votes: 4

What`s so wrong with producing smaller cars with smaller engines?
What is it with americans and that big car big engine mentality?
The A3 is a fabulous car as is the 1series(but it's not a porsche).
And for the hundredth time Lexus has already announced that they are reseaching the posibility of a smaller car.
— zorbeeze (View Profile)

Posted on 2/27/2008 1:13:53 PM | | Votes: 4

Spellchecker, that should be either "Early Lexuses" or "Early Lexus cars."

Also, you did not put a period at the end of your first sentence.

Sorry, I wouldn't normally post about grammar and punctuation in blog posts. (Poor grammar and punctuation in articles and headlines is another matter.) This is just leftover bitterness/humor from yesterday. I'm sure you understand and take it for the half-witted attempt at humor that it is intended to be.
— 1970toyotamarc (View Profile)

Posted on 2/27/2008 2:16:31 PM | | Votes: 4

zorbeeze, what's wrong with making small econoboxes is that they are small, i.e. uncomfortable and cramped e.g. the Lexus IS or Mercedes C-class. I don't mind the economy part but that can be achieved with lighter weight bodies made of aluminum and/or carbon fiber. Of course the unsprung weight would have to be reduced also for a comfortable ride.

The ideal vehicle now is something like the Infinity EX, VW Tiguan or Mercedes GLK -- diesel powered of course.
— EnnNorak (View Profile)

Posted on 2/27/2008 2:33:47 PM | | Votes: 0

last time I checked the 1 series was a $40k car. nothing economy about that.
— vman1013 (View Profile)

Posted on 2/27/2008 11:48:15 PM | | Votes: 2

You're forgetting that in North America, a "Toyota" badge means a Toyota built in North America, and a "Lexus" badge means a Toyota built in Japan. Nothing more.
A US Lexus is often just a Japanese Toyota, just like an Acura TSX is just a European Accord.
— DieselRules (View Profile)

Posted on 2/29/2008 1:29:14 AM | | Votes: 1

EnnNorack, I am fairly certain part of the "econobox" allure is the lower costs associated with buying them. There are larger cars now that are built with aluminum (like high end Jag and Audi's) and carbon fiber (like high end supercars), but I don't think those will qualify as an econo-anything. Just because you WANT exotic materials to make your small econobox a large econobox doesn't mean it's possible. I'd like to win the lottery and bag Jessica Simpson, that's not happening either.
— JRobUSC (View Profile)

Posted on 3/1/2008 1:35:25 PM | | Votes: 1

35% increase in production? ARE THEY NUTS?!?!?

I take it they havent they noticed how slow the U.S. Economy is currently and will continue to be (U.S. is forcasted to grow at half the pace of the other superpowers this year) and the U.S. is Lexus' biggest market and by far...

This makes no business sense for any automaker at this moment in time unless you're a brand like Ferrari with an extensive waiting list. In the end they are going to flood dealers with cars on the lots with big incentives and rebates, "a la GM" and their $6,000 rebates.
— w209w114 (View Profile)

Posted on 2/27/2008 12:57:16 PM | reply to this comment | Votes: 3

"U.S. is forcasted to grow at half the pace of the other superpowers"
???????????
Thank god you're not an economist.
The US economy will slow down as it already has but to grow at half the pace. Compared to who, China?
— zorbeeze (View Profile)

Posted on 2/27/2008 1:16:40 PM | | Votes: 9

i believe the article says "to meet demand in china and russia"...not the US
— LexusKindaGuy12 (View Profile)

Posted on 2/27/2008 1:50:22 PM | | Votes: 3

w209w114, when you increase production you achieve greater efficiencies and economies of scale and therefore reduced cost.. I hope they overproduce like hell so that they will be stuck with inventory which will have to be offered to the suffering consumer at much reduced prices.
— EnnNorak (View Profile)

Posted on 2/27/2008 2:38:09 PM | | Votes: 1

Zorbeeze,

Youre right, reading the latest financial reports every day and being an investor does not make me an economist, but am most likely more informed and knowledgable than you.

What I stated was even broadcasted by CNN and agreed upon by many reputable economists. But dont take my word for it... Here's the video.

http://money.cnn.com/video/#/video/news/2008/02/21/news.velshi.022108.economy.cnnmoney

Good day
— w209w114 (View Profile)

Posted on 2/27/2008 4:09:08 PM | | Votes: 2

Not to mention, Lexus's sales are decreasing quite steadily in the US.
— S4cabriofoxone (View Profile)

Posted on 2/27/2008 4:13:20 PM | | Votes: 4

"I hope they overproduce like hell so that they will be stuck with inventory which will have to be offered to the suffering consumer at much reduced prices."

THAT will NEVER happen! They've never been stuck with over inventory. That philosophy goes against the Toyota Production System, which is the nukes-and-crannies of Toyota/Lexus business strategy.
— RealitySmack (View Profile)

Posted on 2/27/2008 7:52:18 PM | | Votes: 2

this is a risky move. very unlike toyota.

the US is lexus primary market (more than 75% of sales) and lexus sales have been slowing in the US every month since july '07 (see previous posts here).

so why in the world do they need this capacity? (and it's CAPACITY boys, not sales)
— enthusiastx11 (View Profile)

Posted on 2/27/2008 1:38:11 PM | reply to this comment | Votes: 3

im also pretty sure the researches from toyota and lexus know a bit more about what we on this site know. after all, they are working for a billion dollar company, and even you said they are usually more conservative. So they wouldnt do it unless they think its a good decision
— LexusKindaGuy12 (View Profile)

Posted on 2/27/2008 1:52:22 PM | | Votes: -2

Maybe since the article is about expanding sales in China and Russia you should look up how Lexus sales are increasing in those countries.
— 1970toyotamarc (View Profile)

Posted on 2/27/2008 2:18:06 PM | | Votes: 0

enthusiastx11:
no risk - no reward!
— EnnNorak (View Profile)

Posted on 2/27/2008 2:39:45 PM | | Votes: 2

But then again, Audi and BMW, respectively, have strongholds on China and both are still growing rapidly.
— S4cabriofoxone (View Profile)

Posted on 2/27/2008 4:17:40 PM | | Votes: 2

35% increase.

surely shows the growing demand of Lexus from other countries. and this is mostly from Asia from countries like China, Russia, India and neighbours. And don't forget Lexus is still not sold officially in India and neighbouring countries. Once they begin i am sure Lexus sales will drastically improve.

JUGNU
— JUGNU (View Profile)

Posted on 2/27/2008 1:42:23 PM | reply to this comment | Votes: -2

Ok? If you say so.
— VISO (View Profile)

Posted on 2/27/2008 3:38:15 PM | | Votes: 4

i just need to make a slight observation.

it seems like even if you make a just statement on this site that remotely has to do with something positive about toyota/lexus you get deboosted. seems like there are more german enthusiasts than japanese.

common! lexus fans!!! boost your fellow brother! you arent pulling your weight!!

(either that or the germans are just too childish and resort to playground politics)
— LexusKindaGuy12 (View Profile)

Posted on 2/27/2008 2:11:55 PM | reply to this comment | Votes: 6

There are only about 6 Lexus fans left. Even if we all boosted/deboosted, it could never approach the numbers of the Geman fans.
— 1970toyotamarc (View Profile)

Posted on 2/27/2008 2:19:30 PM | | Votes: 5

I'm on no one's side.

But the scale is tipped in favor of the German fanboys.
— M35MT (View Profile)

Posted on 2/27/2008 2:23:19 PM | | Votes: 5

The scale always tips to the most substantial.
— w209w114 (View Profile)

Posted on 2/27/2008 4:13:53 PM | | Votes: 4

They're gaining demand outside the US, this is only logical.
— PlanB (View Profile)

Posted on 2/27/2008 2:58:06 PM | reply to this comment | Votes: 6

I have a feeling the German fanatics hold more than 1 Autospies accounts.
— hatepusss (View Profile)

Posted on 2/27/2008 3:16:23 PM | reply to this comment | Votes: 4

850,000 units production is very optimistic considering that Lexus' sales for 2007 are not even 500,000 units globally and sales were down in Europe overall. I guess they know something we don't
— VISO (View Profile)

Posted on 2/27/2008 3:36:44 PM | reply to this comment | Votes: 2

Spell checker sounds like a fudge packer.
— autopro (View Profile)

Posted on 2/27/2008 5:07:33 PM | reply to this comment | Votes: -3

In 2007, Lexus led all the imported luxury vehicle brands in sales figures reports in China. That is probably where the growth will come from, China and Russia.
— Dan8288 (View Profile)

Posted on 2/27/2008 4:53:47 PM | reply to this comment | Votes: 3

Hey slow witted puppy killer,you must be a fudge packer too,truth hurts.
— autopro (View Profile)

Posted on 2/28/2008 11:54:48 AM | | Votes: 0

I just drove the new ISF man this car is exciting.I almost feel sorry for those poor german saps.Their geeting beat at their own game.LOL LOL!!!!!!!!!!!!
— autopro (View Profile)

Posted on 2/27/2008 5:06:26 PM | reply to this comment | Votes: -1

who the hell screams "LOL LOL!!!!!!!"?
— EvoAudi (View Profile)

Posted on 2/27/2008 8:39:36 PM | | Votes: 3

The IS-F looks very sweet, but why do you have to bash the M3 in the same breath? It's really pointless.
— S4cabriofoxone (View Profile)

Posted on 2/27/2008 9:49:50 PM | | Votes: 1

Except their sales numbers.
— autopro (View Profile)

Posted on 2/28/2008 11:52:33 AM | | Votes: -2

This doesn't surprise me a bit.

Result when you build the BEST car in the WORLD!

Just opposite reaction of what happened w/Jaguar.

Lexus is not only poised to become the world's premier Luxury company as I have predicted back in 1988 of inception date but its happening with awesome elegance, modern design, clean sheet metal looks and most importantly-Safety and even with hybrid tech. Unbelievable~~

Rest plays catch up....
— Homer008 (View Profile)

Posted on 2/27/2008 6:31:08 PM | reply to this comment | Votes: -5

La la la la la la...
— S4cabriofoxone (View Profile)

Posted on 2/27/2008 9:50:20 PM | | Votes: 1

Are there even that many old people in the world to buy all those Lexi?
— EvoAudi (View Profile)

Posted on 2/27/2008 8:37:32 PM | reply to this comment | Votes: 1

You act like bmw audi or mercedes doesn't have any old customers.Wrong again!!!!!!!!
— autopro (View Profile)

Posted on 2/28/2008 3:14:18 PM | | Votes: 1

You're grabbing for straws...
— S4cabriofoxone (View Profile)

Posted on 2/29/2008 1:18:24 AM | | Votes: 0

So much for Lexus only selling in the US. Looks like Lexus expects N.A. to go from their only market to just their largest one...for now.

w2091114,
Sort of like the incentives Mercedes-Benz Canada has right now?
$4,000 off an E320 or E350.
$8-15,000 off on S and AMG models. Do they really need incentives on these ones?
http://www.mercedes-benz.ca/index.cfm?id=6159
— huu76 (View Profile)

Posted on 2/27/2008 9:52:04 PM | reply to this comment | Votes: 0

Mercedes has no incentives at all on the C-class. The E-Class you can ALWAYS get a good deal on especially since it is an older model.
NOTICE: the same car that costs $52K in the U.S. costs $68K Canadian Dollars there so therefore 4,000 bucks represents a much smaller percentage from 68K than 52K .
This is also the time of year they start clearing up for the 09 models. Mercedes does it very early every year compared to the rest. Notice the BIG rebate on the SL550 and put it together with the launch of the heavily refreshed model.

Your comparison is not only misleading, its totally flawed because of what I just mentioned. I was referring to 35% increase of ALL models which results in overstock of across the line.

Thanks
— w209w114 (View Profile)

Posted on 2/28/2008 1:17:13 AM | | Votes: 2

Interesting story, I had heard Lexus was very popular in Russia. Bold move, since the slowing of the US economy usually effects the rest of the world. That said Russia does have a lot of oil money to burn.
— theoptimisticpessimist (View Profile)

Posted on 2/28/2008 3:40:41 PM | reply to this comment | Votes: 1

W209,
X amount off is still X amount off. There's nothing stopping someone from driving over the border if they want to pay the lower price.
You claim one company needs incentives but can't handle the fact your brand does it too.

Canada also gets the C230 Kompressor, which is pretty pathetic imo.
— huu76 (View Profile)

Posted on 2/28/2008 8:48:55 PM | reply to this comment | Votes: -1

Ummm okay, did you not read what I wrote? Are you aknoledging that what you said was misleading??? And yes most car companies do offer incentives especially towards the end of the model year. I stated that.
— w209w114 (View Profile)

Posted on 2/29/2008 1:26:15 AM | | Votes: 1

acknowledging**
— w209w114 (View Profile)

Posted on 2/29/2008 1:27:03 AM | reply to this comment | Votes: 1

Lexus will crank production and tank prices to try to compete in China, where VW/Audi stole the market.
A few years back, VW had 35% of the market share in China, and sell more cars in China than in Canada and US combined (their share is higher in Canada than in US).

Toyota will try to buy their way into the growth markets with cut pricing as a last-ditch effort to gain some momentum. Its a wise move, because perceptions, once established, are hard to change.
— DieselRules (View Profile)

Posted on 2/29/2008 1:38:57 AM | reply to this comment | Votes: 2

on one of these autospies threads, it was mentioned some Lexi models were going for $150-200,000 in china.

there are also no FOUR-cylinder Lexus models there to dilute the image of THE premier prestige brand.

— XYZZ (View Profile)

Posted on 3/1/2008 5:27:13 AM | | Votes: 0

#1 - "lexus said..." so how come their average buyer is still 55+? where are these wildly new products that will appeal to 35 year olds?

#2 - largest growth potential? really? they're pretty much insignificant outside of the US. do share your insights.

#3 - your predictions are useless since they have no factual backing.
— enthusiastx11 (View Profile)

Posted on 2/29/2008 2:14:55 AM | reply to this comment | Votes: 0

obama:

"Lexus will probably have more new models then anyone else in the next 5 years. "

yeah, probably. lexus has never had NEARLY as many models as bmw or mercedes. they operate on a model of 'one size fits all.' that's why bmw currently has over 45 models in the US while lexus is at an all time high of 18. mercedes has even MORE. this is part of the reason the germans command premium prices...you can have a car as you want it. you won't just have the EXACT SAME silver ES or LS that 3 of your neighbors have.

that doesn't mean lexus won't do very well. they will. aging boomers are a huge group of affluent buyers. they don't care much about cars and want a good value. lexus should thank god for the huge 55+ market and stick to what they do best. (and so far they have...the ISF is the ONLY exception).
— enthusiastx11 (View Profile)

Posted on 2/29/2008 12:16:44 PM | reply to this comment | Votes: -2

It takes time and alot of money to expand your product line.Lexus has only been around 17 yrs.The next ten years their product line and market share will grow,big time.
— autopro (View Profile)

Posted on 2/29/2008 12:26:45 PM | reply to this comment | Votes: 0

further, it's not like lexus has to have a model to match ever 1-series, A- and B-class, etc. etc.

there are the toyota and scion lines for that. lexus has the market/positional luxury of being able to concentrate EXLUSIVELY on true luxury cars.

— XYZZ (View Profile)

Posted on 3/1/2008 5:33:38 AM | reply to this comment | Votes: 0

so the REALLY funny thing is, that the german "luxury brands" are now cranking out stuff to compete against TOYOTA and SCION brands! LOL!

mb tries to expand UPmarket with the maybach. good for them. but how much volume does that add? VW tried too with the Phaeton, the biggest Phlop in auto marketing since the Edsel.

toyota has the most well thought out strategy: Scion for 1st time car owners, Lexus EXCLUSIVELY with luxury cars, and papa Toyota covering everything in between and sideways (like pickup trucks).
oh yeah, plus Hino for big trucks and commercial vehicles, so as not to DILUTE the luxury image with COMMERCIAL stuff like MB does.

toyota has been ramping up for DECADES. that Lexus is now ramping up too, just shows how brilliant and successful the company was since 1989, and still is.

— XYZZ (View Profile)

Posted on 3/3/2008 3:06:53 AM | | Votes: 1

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Ramping Up For The Kill? Lexus To Increase Production By 35%

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