By Robert Farago
September 11, 2007 -
During my brief stint in British advertising, I had the distinct pleasure of working with one Paul Harvey Douglas. Paul was the world’s best headline writer. He could distill an entire advertising campaign down to a single sentence, a phrase, a word. I wonder what PHD would have made of Lexus' ad for its new F-Series automobiles. “What is F?” the two-page Autoweek center spread asks. “F is everything you thought we weren’t,” it answers. I could almost hear Paul’s derisive snort. “F means their brand’s in ‘effing trouble,” he would have pronounced. Too right, mate.
Let’s start by parsing the imagery. I have no idea what the smoke drifting through the heart of the “teaser” ad is supposed to mean. It’s not, as savvy enthusiasts might expect, tire smoke. It looks more like cigarette smoke. More specifically, advertising cigarette smoke. You know: the kind of photo-shopped psychedelic smouldering that’s been carefully crafted to hide nightmarish images that stimulate your subconscious desire to, uh, smoke.
After copious quantities of Clos De Bois, I can make out a dragon’s head, a couple of demonic faces and a Toucan-beaked hoodie-wearing beastie. And I feel a strange desire to fire-up a doobie. Anyway, the background above the horizontal plume is elegantly pin-striped, like a City gentleman’s business suit. The background below is jet black. As “F” is Lexus’ new performance sub-brand, the change is a subconscious signal that Lexus is about to offer both baby Bentleys and supersonic stealth bombers.
So here we have an ad that clearly signals Toyota’s intention to take the idea of Lexus as provider of floaty-drifty sarcophagi-on-wheels to America’s well-moneyed set and burn it in the same furnace the Vatican uses when the Cardinals get together to elevate one of their own to God’s CEO. Presumably, when you see the white [demon-filled] smoke rising heavenwards, you’ll know Lexus has been reborn, ready to kick some major league sports sedan ass.
Why? Why does Lexus need to build a sports or even a sporty car? I asked this question before, after attempting to cane the thoroughly unrewarding IS 350. I’ll ask it again. How many customers walk into a Lexus dealer thinking right, THIS is the place where I’ll finally find a car that’ll blow the doors off an M3 on the Nürburgring! That’s a bit like rocking-up to your local Volkswagen dealer looking for a $95k luxury sedan. Or heading over to a Porsche dealer for an SUV. Or journeying to a Chevy dealer for a $60k sports car.
Don’t get me wrong: those are all wonderful cars. And I know Mercedes’ in-house performance division sells more $100k+ automobiles than any other manufacturer in the world. But that doesn’t mean they should. In fact, the fact that they have may have had a little something to do with the fact that Lexus’ LS is kicking Mercedes S-Class in the ass (the score so far: 23.4k to 17.5k).
I also understand that you kinda expect a Lexus to offer at least modicum of body control and a soupcon of genuine forward thrust. But that’s because you’re a pistonhead. For the vast majority of Lexus buyers, it’s all about rock solid build quality, sumptuous materials, tomb-like silence, obsequious service, snob appeal and mindless wafting. IF the average Lexus customer thought about it, they’d probably think that the idea of a sporty Lexus is… confusing. And that’s because it is.
In fact, let’s say you weren’t a pistonhead and didn’t know that F is supposed to be the new M. If you read the AutoWeek ad headline literally– “F is everything you thought we weren’t”– you’d have to think a Lexus F is going to be cheap, nasty, loud, uncomfortable and unreliable. And that would make the new F Lexus’ evil twin. You don’t have to Google Garth Knight to know how THAT plot line turns out.
In short, the whole Lexus F thing is what branding experts would call The Mother of All Stupid Ideas. And there’s only one reason why a brand so strong my appliance installer called my new Kitchen Maid the “Lexus of dishwashers” would want to launch an anti-brand brand: boredom. I firmly believe that halo cars, sporting sub-brands and wacky brand digressions are simply a way for bored executives to avoid facing the long, tough, often dull slog that good branding– and product development– requires.
If Toyota wanted to build Porsche-killers, it should have created a new brand. Of course, Lexus’ decision to take its eye firmly off the ball is good news for its competition. Well, it would be if the other luxury automobile brands weren’t making the same mistakes: too many models at too many price points, too many genres, conflicting subdivisions, etc. At this point, Ferrari, Maserati and Bentley are the ones to watch. At the moment, they’re everything you think they are.
[Listen to branding guru Al Reis discuss Lexus' F below]
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End of Comments
September 11th, 2007 at 4:08 pm
Speaking of poor Lexus marketing…
I was watching the US Open finals this weekend (sponsored by Lexus) and one of the prizes was a new Lexus IS-F (never heard of it before). The Vice President of Lexus made the presentation and described it as something new and something we wouldn’t expect from Lexus. Granted, if I haven’t heard of a car, then it hasn’t been in the public that much (between here and my casual reading of Jalopnik, I generally know what’s going on), but the way he presented it really made it look bad and unknown. What he should have done was talk about it like it’s all the rage and that everyone already is dreaming of having one in their garage now. Then the folks who don’t know what he’s talking about would just assume that everyone else does and that it’s an awesome car. My guess is that the current ad firm working for Lexus is dumb.
September 11th, 2007 at 4:35 pm
Oh no! Another “Brands can only have one facet” conversation! ;O)
I think Lexus making some Porsche killers sounds like a corking idea! Toyota are turning Lexus into a proper luxury division. Let’s face it it didn’t do Jaguar any harm with the X-type and the XK, BMW with the 3 series and the M series, Audi with their regular sedans and the R8 and Mercedes and their AMG engineered cars.
If anything, it’ll bring Lexus into line with their German counterparts, which is exactly where Toyota should take Lexus.
Personally, I think Porsches are so “done”. If I was in the market for a premium sports cars, Aston Martin is the one for me. Beautifully styled, understated brand and British! What more could you ask for…..?
September 11th, 2007 at 4:41 pm
Seems like there are two separate questions here.
1. Should Lexus have a performance division? Sure. It helps expand their brand in a new direction, and doesn’t necessarily conflict with the anaesthetized cruisers they sell now so much as complement them nicely.
2. Is this the right way for Lexus to market its new performance division? No F-ing way. Why denigrate all your current accomplishments and seem ready to kiss off the brand you’ve already built?
September 11th, 2007 at 4:49 pm
“What is F?”
Too close to WTF in my opinion.
September 11th, 2007 at 5:02 pm
Chris Gaines thinks that a sports car Lexus is a great idea.
September 11th, 2007 at 5:03 pm
Performance and luxury are two discrete things that well-heeled pistonheads have decided belong together. Nobody can really tell me a Porsche is a luxury car, they are kind of crappy inside and they are loud. They are performance cars.
Lexus is a luxury car brand. BMW straddles the two, but with a growing preference for suburban bloat and luxury over performance.
I agree that F-cars are retarded. I would love a performance minded Toyota, the IS should have been one, and the Supra should return. This new Ferrari killer should have just been the new 2000GT, a car that was beautiful and a perfect fit for Toyota which needs some exciting halo cars. Hell, the IS, if it was a bit cheaper, could have been a Scion just like, hopefully, the new AE86 will be.
There is no question that if I was being chauffeured around, I would pick an LS over an S-class, the massaging seats see to that.
September 11th, 2007 at 5:08 pm
Blame the growing appreciation of the sporting characteristics of Nissan’s performance division on Toyota’s need to “spice up” Lexus.
Toyota has been patiently chipping away at the Germans who had a few decades headstart of Lexus to build a reputation, but I don’t think they are willing to stand still and allow domestic competition from Infiniti to force them into fighting another upstart Japanese brand on an additional front.
I don’t think the “F” is as much a shot across the bow at AMG and M..as it is an attempt to smother Infiniti before it becomes an accepted player in circles generally reserved for the Germans and Lexus. It fought too hard to be the only Japanese mass luxury brand in the hunt…Infiniti is making gains. They want to be the new Mercedes, but they don’t want to inherit a new BMW in the process.
September 11th, 2007 at 5:13 pm
F is a horrible moniker for a sporting division, imo. F? Like “Hey I made a cool car but the reviewer gave it an F” F? Failure F? Booooooo. Also the logo is weak-sauce.
I think the introduction of luxo sport models is OK, similar to the M models for BMW, but from a pure branding perspective it would be better to maintain focus. Problem is, starting a brand is darn tough, and the cachet of the Lexus name was probably too tempting to pass up.
Lexus for me presently represents precise, quiet luxury; black cars with rich people inside of them. They’re going to lose that mindspace and become more muddled. However, in the short term they’ll probably make money off it, and that’s all that counts in the minds of the bigwigs. Not the best move if you take a 100-year perspective, as superbrands would…
September 11th, 2007 at 5:16 pm
The Garth Knight reference nearly killed me. You should really put up a picture of him in order to make your point.
I generally agree the branding sucks, but if the cars are good, who cares? There are a lot more confusing, stupid marketing campaigns, and I’m sure WIF? will be ditched once an expensive consultant tells Lexus it’s not increasing awareness. I think the S-classes issues vis-a-vis the LS are more to do with Lexus putting out a superior product than AMG brand devaluation. I mean, it can park itself! With only superficial damage!
Saab’s tagline “Born From Jets” is pretty untouchable in the forehead-slappingly ridiculous tagline category.
September 11th, 2007 at 5:20 pm
Sometimes we all need to come out of the “extreme” auto-enthusist box and see the world for what is really is!
RF, I love cars but sometimes I think you overstate the issue here. Porsche is Prosche and Ferrari is Ferrari but for the most part Audi, BMW, MB, etc are all just brands. If the Germans can successfully market sports oriented cars under their brand name why on earth would lexus not be able to do so?
The word on the street is so different from what you see here that it is important to remember that most folks do not care about all of the deep down details of their cars. Yes, even those lucky enough to own Porsches and Ferraris.
Lexus is currently considered a top dog player in the premium auto market. They do have the clot necessary to sell sportier models here in the USA. The name Lexus is synonymous with luxury and quality as well and excellent engineering and technology.
On top of this Lexus has built up one hell of a loyal customer base over the last 15 years. These folks have the means and they will traffic Lexus showrooms. Many of them will be more then happy to trust in Lexus and give them a shot (provided they get the sports car right).
BTW, There are quite a few people who are looking for the anti-Porsche today. All of us 30 to 40 somethings that managed to spend some time behind the wheel of any of the great Japanese sportscars of the 1990s 300zx TT, RX7 TT, Supra TT, MR2 Turbo, Miata, and NSX. We tend to see the current Porsche lineup as more show than go. We also know Toyota, Nissan, Honda, or Mazda could each give porsche a “run for the money” if they decided to go there. Come on how hard would it be to make a CaymanS killer and price it $25,000 less!
September 11th, 2007 at 5:38 pm
Link to the ad?
September 11th, 2007 at 6:10 pm
rjzinger :
It’s a print ad; I can’t find a link.
whatdoiknow1:
If the Germans can successfully market sports oriented cars under their brand name why on earth would lexus not be able to do so?
The Germans and Lexus can dilute their brands (and make money at it as well). But that doesn’t mean they should.
foobar:
expand their brand in a new direction
That’s like saying “take your bike on an ice rink.”
September 11th, 2007 at 6:15 pm
Right on! Toyota proved with Lexus that they could start a successful high-end brand from scratch. Why not just replay the same script and call the new cars something else entirely?
September 11th, 2007 at 6:37 pm
RF,
You point is well taken but are not high-end sportcars by definition luxury cars today? The days of the Porsche 944 (the affordable Porsche) are long over. We live in a time were a bare bones Elise will still set you back well over $50,000. With the exception of the Mustang, MX5, and 300z there is nothing remotely resembling a true sports car that does not scream luxury product!
GM is the company with the sportcar image problem, do to the fact that the Corvette (one of GM most expensive products) is stuck in low-end Chevy showrooms. This hurts the Corvette and adds to the precieved POS factor. The Corvette a $50,000 to $60,000 car should be sold in Cadillac dealerships. At that price it IS a luxury vehicle like it or not.
I think us car enthusist will be the last to admit (bite my tongue) that for the most part the concept of true sportcar is losing relevence in todays world. Come on, we live in a time when any number of sports sedans can pull 60 in 5.0, hold over .90g, and twist through the cones at over 60mph. What this means is that the need to jam our bodies into low slung cramped cars that we can’t see out of is fading. Cars like an M3 make any number of sports cars look like silly adolescent toys.
Honestly if Lexus existed in 1967 would not the 2000gt be sold as a Lexus back than? My point cars like the 300sl, XKE, M1, help maker MB, Jag, and BMW into the brands that they are today.
September 11th, 2007 at 6:38 pm
Toyota proved with Lexus that they could start a successful high-end brand from scratch. Why not just replay the same script and call the new cars something else entirely?
That would take another two decades. It’s easier and cheaper to leverage the existing brand than it would be to start over. Toyota’s branding did not have (and continues not to have) the brand equity needed to sell a luxury car, but Lexus does have the brand value needed to support a specialty badge.
That, and I see that this is akin to S- and RS-level Audis or M-class BMW’s. The likely goal here is to cultivate cachet value for the mainstream products by having a halo product or two hovering above them. Everyone does it, and I can’t see why Lexus would fail with an initiative that has historically benefited its competitors.
But the “F” moniker is a poor choice, perhaps the execs in Japan don’t realize that Americans are raised from early childhood to regard an “F” as a failing grade, not the mark of distinction that you’d like to bring home to Mom and Dad. Perhaps all of the really cool letters are taken, but come now, out of the 25 others in the alphabet, isn’t there a better one than this?
September 11th, 2007 at 7:27 pm
The Corvette a $50,000 to $60,000 car should be sold in Cadillac dealerships. At that price it IS a luxury vehicle like it or not.
*coughCadillacXLRcough*
When you have halo cars of that level, they’re really above the badge that’s on the hood. You’re not going to see a Corvette in the same way you’ll see a Cobalt. You’re not going to see a Viper in the same way you see a Neon.
Anyway, that’s all irrelevant to the “F” campaign. Lexus doesn’t need it, but if they’re going to go toe to toe with BMW M’s, Mercedes AMG’s, and even Cadillac V’s, they’ll have to toss their ‘F’ into the alphabet soup fray.
September 11th, 2007 at 7:34 pm
The performance division of these manufacturers, AMG for M-B, M for BMW, S for Audi, V for Cadillac build “halo” vehicles for the rest of the car line.
The Germans are at the point where they “performance tag” every model of their car line, and are reaching a point of overkill. It does get people to drool. Do a video of the performance version doing hot laps at the Nurburgring, and the lease program on the bread and butter version gained effectiveness.
Does Lexus need the F to sell cars, perhaps not, can Lexus enhance its brand / image with the F blasting around the Nurburgring, sure.
September 11th, 2007 at 7:57 pm
AGR :
Does Lexus need the F to sell cars, perhaps not, can Lexus enhance its brand / image with the F blasting around the Nurburgring, sure.
Hello? The whole point of this editorial is that F does NOT enhance the brand; it confuses the brand.
Can someone please explain how F HELPS Lexus? I mean, a coherent argument.
September 11th, 2007 at 8:02 pm
I think they realize that a lot of current or former Toyota owners want something sporty, or at least the dreams of it. The Supra was so many kids’ dream car and its name is still very strong. No one actually bought a new one though, so Lexus knows that no one has to buy its halo cars to get that halo effect.
More importantly, $35k sports sedans have overtaken $35k sports cars in importance, and a halo car to mess with Lexus’s brand identity will allow those to sell.
September 11th, 2007 at 8:37 pm
Robert Farago :
Can someone please explain how F HELPS Lexus? I mean, a coherent argument.
It goes something like this: High-strung alpha males buy performance sub-marque cars like AMG and M because of their personalities. Said high-strung alpha males (the marketing dweebs would call them “influencers”) are looked upon as aspirational behavior models by lower-status members of the pack (er, company). Thus the fact that the boss is driving an IS-F means that driving an ES or RX will increase your status in his eyes, and he can’t look down on your choice of car because to do so would be to dilute the status of his car slightly, which he would never do.
That’s the theory at any rate, and it probably helps to explain both the number of M cars I see in the parking lot at ye Fortune 100 Company headquarters and the vast sea of 325i/328is I see in the parking lot every morning. Of course where the theory falls down is that if your boss is one of these mobile coronary disease incubation units, he probably hates your guts anyway, so it really doesn’t matter what you drive.
If Lexus really wanted to follow through on this, their first F model would be an LS-F. BMW’s refusal to build an M7 (the Alpina B7 doesn’t count) leaves a gap open that an LS-F could fill quite nicely. The IS-F is entering a field which is extremely crowded with good models and offers nothing I can see over the S4 or even the 335i. Doing an LS-F would instead establish F as being the ultimate Lexus which competes in the rarified $100k+ range and offers both performance and luxury above an “ordinary” Lexus. Well, something other than F, at any rate.
September 11th, 2007 at 8:42 pm
carlisimo :
Show me ONE shred of reasonably scientific evidence that supports the theory that halo cars help sell less expensive models.
It’s a shibboleth. Something to do with the Beach Boys, I think.
September 11th, 2007 at 8:42 pm
Perhaps the F-line of cars won’t enhance the Lexus brand, but perhaps it’ll allow them to be competetive without having to compromise their vehicles as much. If they were to create a whole new brand, we’d accuse them of having too many makes (like GM). If they were to build performance cars, and not have the F-designation, they’d have an unclear image. So, they either have to overlook an important part of the market (fast still sells, and Lexus has long been weak on emotion), or do as they did, and create the performance lineup - obviously, these are still Lexi, with all the typical Lexus traits, they’re just fast now.
September 11th, 2007 at 8:54 pm
Ryan :
Perhaps the F-line of cars won’t enhance the Lexus brand, but perhaps it’ll allow them to be competetive without having to compromise their vehicles as much.
What's this about being more competitive? I wasn't aware that Lexus was hurting for business. As for compromising their vehicles, that's exactly what F is about to do. This goes back to some themes I've set before you wolves before. Namely that too much choice is a bad thing, not a good thing. And a brand should have a single coherent message.
As for Brian E's suggestion that automotive alphas influence those beneath them (I want to be a man, man-cub), I used to be a believer. Now, I'm not. I think that whole trickle down theory is nothing more than motorized humanism: made by us for us to make us feel better about us.
Does a Nissan Skyline make someone want to buy a Nissan Altima? Doubt it. And if it does, the buyer needs a baseball cap that says "statistical anomaly." As does anyone who thinks that any large chunk of 3-Series sales can be attributed to their M product. Or that the SLR makes a mess of Merc buyers want to buy a C350.
And while those AMG, M, S, RS, V, SS, etc. models may sell well, the depreciation curve is… awesome. To me, that indicates a disconnect between the halo and bread-and-butter models.
September 11th, 2007 at 8:58 pm
RF: If you’re arguing that Lexus should not make a sporty Lexus even if doing so increases Lexus’s overall, long-term return on investment, you’ll have a tough row to hoe. If you’re saying that even if the sporty car by itself generates profits, it’s a bad idea because in the long run it will undermine overall Lexus ROI by diluting the brand, I could maybe see your point. Only time will tell. Such distinctions aside, though, I am not at all convinced that there’s no room at Lexus for a sporty car. What if the Lexus brand is simply the “pursuit of perfection” that they have trumpeted? High quality, reliable cars with (I hear) unbeatable customer service. Easy to squeeze a sports car in there somewhere!
The IS 250/350 issue is a fascinating one. I liked the first generation IS but have to acknowledge that it was not a good match as an entry level Lexus. Too sporty inside and out. I think Lexus made progress in the second generation in terms of attracting the upscale, fairly staid market. What could be more logical than finding another slot for a performance Lexus–that is, a slot other than the staid first-step-up-the-Lexus- ladder slot?
September 11th, 2007 at 9:00 pm
HawaiiJim :
What could be more logical than finding another slot for a performance Lexus–that is, a slot other than the staid first-step-up-the-Lexus- ladder slot?
Building a better LS. Again. And again. And again.
September 11th, 2007 at 9:01 pm
“Can someone please explain how F HELPS Lexus? I mean, a coherent argument.”
maybe. without knowing how many people out there are like me, and without knowing how much development and marketing money was spent on F, i can’t give you a good idea of ROI vs. lost sales from confused wafters.
i do believe that the car has a point and a purpose. i love to drive fast, and i love to drive the snot out of whatever i own at the time. i have no room in my life for service departments, and just about any auto repair psychologically strikes me as a ripoff regardless of its price. i would love to have a boxster, but i can’t stomach the oil changes. i’d love an M3, but after seeing the service costs of a friend’s bimmer, no thanks. we all make fun of camrys and corollas because of their soulless appliance nature, but…
somebody needs to make an appliance-reliable sportscar, and i would prefer that toyota do it.
make it fast, make it stick, make it fun, and make it so that i don’t have to think about it. i’ll change the oil, i’ll rotate the tires, and other than that, i want to be left alone to pound on it.
i do have a problem with the IS-F only being an auto (though an 8 speed auto sounds kinda cool), and i’m still waiting for a real sportscar (not just a hotted up sedan), but it’s a step in the right direction.
the oldsters and the snobs probably won’t even notice the F, so it may not harm the brand. people like me love fun but are so risk averse that many sportscars are out of the question. i also like to be invisible, and part of me thinks that NOBODY is going to notice the IS-F.
i don’t need a whole new brand, but a different letter would have been good. for some reason i just keep thinking “O-face”
September 11th, 2007 at 9:04 pm
now that i think about it more, they should have just called it the IS 500 and not said another word.
but they still should have built it.
so to answer your coherent argument question, RF: no.
September 11th, 2007 at 9:07 pm
Lexus are currently known as gussied up Toyotas. The last thing an exec dropping $75k on a car wants is for someone to ask if it’s a Camry with leather. Lexus management also know this, and know they’ll hit a price limit nobody will pay because of their more humble roots (Phaeton anybody ?). Hence they introduce a performance line; it may muddle the brand, but it’s better than the brand being muddled with Toyota.
September 11th, 2007 at 9:28 pm
Does a Nissan Skyline make someone want to buy a Nissan Altima? Doubt it.
One of Nissan’s greatest mistakes in the US market was getting rid of the Z cars, despite the fact that few people will ever buy one. Bringing them back in conjunction with a much-improved Altima helped to restore credibility to the brand image of Nissan as something more than just a dowdy transportation provider, and helped to save the company from ruin.
VW was on the verge of pulling out of the US market when it reintroduced the Beetle. The best thing about the Beetle is not how many copies it sold, but how it got people into VW showrooms who subsequently bought Jettas and Passats. They didn’t necessarily want or even like the Beetle, but it created a certain vivaciousness to the brand that made it interesting again.
If halo cars didn’t work, then I think that the successful automakers wouldn’t bother with them at all, yet they do. Performance builds credibility in the eye of the consumer, even if the consumer doesn’t need or want the performance for himself. The heritage makes the buyer more comfortable that a bit of it has rubbed off onto his lower echelon version of the product.
But forgetting the brand for a moment, these specialty models help with product positioning. There is an old marketing gimmick for consumer products that involves creating three product tiers. The idea is to use the highest and lowest tiers to support selling more units of the middle variant. Many consumers will view the middle choice as a sound compromise between the cheapo bottom version, which is too pedestrian and low rent for consideration, and the high-end version that may be nice but is too extravagant. But to have a middle, you need to have a top, which is where the halo comes into play.
Also, I would bet that the halo cars help within the company. Not only do the products become R&D mules that create improvements that eventually trickle down, but they also provide programs to which ambitious engineers can aspire. If automakers don’t have exciting places for employees to move on to, then they are more likely to leave the company entirely. Even if a hot-car specialty unit failed to sell a single unit, if it kept valuable employees on the payroll and created product advances that could benefit the breed, those benefits alone might be worth the cost.
September 11th, 2007 at 9:43 pm
I suspect ever increasing wealth concentration at the very top has something to do with this. Lexus knows full and well the customer segment whose purchasing power increases the fastest, are the ones who can already afford Ferraris, McLarens and Bugattis. Some of those guys, despite Maybach qualifying wealth, are Lexus drivers, and hence stop by Lexus dealerships on occasion. Having a nice looking, ‘faster than a Porsche’, high margin, 3rd, 4th, or 11th car to sell these guys is probably too lucrative to pass up.
September 11th, 2007 at 9:48 pm
Pch101 :
Well, you’ve certainly done an excellent job presenting all the traditional arguments for halo cars. But I don’t believe a word of it.
Altima sales were NOT helped by the Z, old or new. Accord or Altima Darling? Oh, let’s go for the Nissan. I like the Z. Does that sound remotely credible to anyone other than a pistonhead? Altima sales were helped by the new Altima. Period.
And even if it DOES sound plausible, that doesn’t make it true. Where’s the evidence? Given the billions of dollars required to produce these marketinf department divas, you’d think someone, somewhere would study the correlation– real or imagined– between sales of the high-priced wheat and the lower-priced chaff. If someone knows of such data, clue me in. Otherwise, I’m from Missouri.
If halo cars didn’t work, then I think that the successful automakers wouldn’t bother with them at all, yet they do.
That sort of sophistry doesn’t cut it with me, Bub. In other words, Ford GT. Friggin’ awesome machine– that did sweet FA for Ford's fortunes. As we pointed out way back when the GT was THE bright shiny thing sparkling in the light, the Studebaker Avanti was another populist (if not popular) halo car that presaged the company's collapse.
Performance builds credibility in the eye of the consumer, even if the consumer doesn’t need or want the performance for himself.
I want a nice sensible snoozemobile. I’ll buy the one with the optional V10 even though I don’t want the V10 because it’s nice to know that someone else will enjoy its power. C’mon. We’re truth seekers here. Pay attention to that man behind the curtain. He’s trying to get you to bring him the witch’s broom. Or something like that.
Not only do the products become R&D mules that create improvements that eventually trickle down, but they also provide programs to which ambitious engineers can aspire. If automakers don’t have exciting places for employees to move on to, then they are more likely to leave the company entirely.
When a company starts building models to amuse internal "customers," it either has too much money or not enough brains. As Mr. Reis said, halo cars are both a waste of resources and creates perception problems for "lesser" models. What was top of the line becomes middling (e.g. the Maybach downgraded the value of the top S-Class). In that sense, these halo cars can actually be the devil's horns. Beep-beep.
September 11th, 2007 at 9:52 pm
stuki:
Nope.
A Ferrari driver doesn’t want a Lexus that drives like a Ferrari.
Sure, they may want a BMW that drives like a Ferrari, but I hardly think “they” constitute a large part of Lexus’ market. Or BMW’s, for that matter.
And anyway, that Lexus as Ferrari driver’s luxury car strategy would pit Lexus against BMW on BMW’s terms. How smart is that?
September 11th, 2007 at 10:51 pm
I think it is a fact that the automotive line is one of the most dynamic and theoretically perfect mediums to apply branding to - a cohesive design language, a few targeted offerings, consistent copy and a well-managed creative department could work together to create glorious, textbook examples of branding with which the consumers could identify mentally, viscerally, and emotionally.
I think it is also a fact that if any company wants to make serious money, they have to kowtow to the market, and branding decisions are tempered by financial and business decisions. The F line is a good example of this - it will unquestionably dilute the Lexus brand but will most likely generate sales and reward stockholders. That’s it. That’s the end game. Especially in publicly traded companies, the image of a brand will be constantly compromised by market demands.
Branding is an art and a science, but business is business. Very few companies are willing to sacrifice the low-hanging fruit of instant profits and increased market share in order to preserve the precious brand they should be protecting (i.e. the Cayenne and Panamera). I think it’s a shame and an outrage and sometimes almost irreparable to a businesses reputation (i.e. the Cimmaron) but that’s just how it is.
Also I would like to reiterate my utter disgust and bafflement with the “F” moniker… mind blowing. The letter doesn’t even convey any sense of speed and precision! V is sharp, S is speedy, M is manly and powerful, AMG is an abbreviation of a crazy name, and F is like a fat sloth and I hate it more the more I think about it.
September 11th, 2007 at 10:53 pm
I can understand the reason for the F-Series’ (due apologies to Ford there) existence. For starters, Toyota is spending what seems like billions in major racing series with absolutely no return on the marketing investment (does a Camry or Corolla buyer gravitate to ToMoCo because of their presence in F1? I’d bet at least half the farm on “no”). For another reason, Lexus is probably at the end of the line when it comes to expanding on their solid lineup of– what did you call them– sarcophogii, they seem to have the range covered unless they start treading in S-Class/Bentley/Rolls territory. Where do you go next?
Like full-size trucks, Toyota’s track record on the performance side of things is uneven but if Lexus, with its rep for bulletproof reliability and high-class call girl levels of customer service can poach some dissatisfied BMW and Porsche customers and hang on to them, then it is mission accomplished. I mean, that’s how they got to where they are today– stealing dissatisfied Mercedes and Cadillac customers.
As for the ad, “what is F?”. Sounds like a result of a banal creative brief and a convoluted “gotta do it all” brand plan. I mean, guys if you aren’t going to tell me what “F” is, then I can’t tell you.
Hmmm, alternative headlines.
Black Sheep
Silence is Golden. Screaming is Exhilerating.
Never give Engineers a Day Pass
I don’t know, I’m trying to build RV ads right now…(!) Maybe Lexus can do that next.
September 11th, 2007 at 11:17 pm
“If Toyota wanted to build Porsche-killers, it should have created a new brand.”
I couldn’t disagree more. If Lexus wants to build a performance two door coupe or roadster there is no reason to give it a whole new nameplate.
Your logic would imply that Mazda should have come up with a new nameplate to sell the Miata or that MG in it’s heyday should have had two different divisions, one making cheap and cheerful sports cars and the other build family sedans.
This is just silly.
If anything I would argue that Mercedes was foolish to pull the old Maybach name of out the hat for it’s over the top sedan. For heaven’s sake, we have too many automotive “brands” already. Different models of Lexus can quite readily be targeted at completely different customers. BMW and Mercedes already do so very well.
In many ways the Lexus brand’s customer perception has always been: “Great clones of high end German cars with better reliability, better service and a 25% discount.” Mercedes was clearly the first target. More recently a bit of BMW cloning has been going on at Lexus. Following this logic, a great Porsche fighter makes total sense.
Now I wouldn’t name it What The F, but that is a different conversation.
September 12th, 2007 at 1:53 am
The Lexus F cars will still be a Lexus through and through. That means the Lexus F cars will STILL be refined, comfortable, high quality and luxurious but just at another level of performance compared to a regular Lexus.
Why didn’t Toyota make a new brand instead of a sub-brand? Very simple, it’s because the F cars will STILL have most of the attributes and characteristics that people associate with a Lexus.
If the F cars were COMPLETELY different from a regular Lexus (which they are not) then and only then would it make sense to have a new brand.
RF, you ask for any sort of proof that halo cars help sell lower end cars. Let me ask you this; do you have ANY proof that halo cars DON’T help to sell lesser models? Do you have any proof that halo cars DON’T help the overall image or reputation of a brand?
Do you think BMW would be the same today in terms of image and rep if they never came up with their M sub-brand?
September 12th, 2007 at 2:32 am
You know, I think religion and politics have caused less arguments than “Can brands have more than one facet?”! Poor Mr Farago is on the verge of a nervous breakdown! ;O)
Putting aside the issue of the name of this performance moniker (whether it’s stupid or not), I reckon that Lexus can pull this off. It did the Germans no harm with their M series, AMG engineering and Quattro/S moniker. I don’t think it’ll dilute the brand as Lexus holds the “Higher bracket” echelon for all potential Toyota buyers (Much as Cadillac was to Chevrolet). If Toyota/Lexus created a new brand for their sports car division, then they’d be making the same mistake as a certain General who’s fallen on hard times. By the same logic, Toyota, should have created a new brand for their pick up trucks and another for their SUV’s.
All Lexus are trying to do, in my opinion, is bring themselves more into line with their German competitors.
September 12th, 2007 at 3:00 am
All Lexus are trying to do, in my opinion, is bring themselves more into line with their German competitors.
Oh, I hope not. Back when my dad was working, one of his duties was to take his boss’s car (company car, really), a Mercedes S-Class, in for servicing. Dad used to tell me horror stories in getting the dealer to do just what the manual said was necessary, but even so it still cost a small fortune. When the boss retired, knowing the poor reliability of the Mercedes and the Toyota-like operating costs of the Lexus (aka cheap), guess what he bought for himself?
As for emulating AMG, why not? So what if it kills the brand, Toyota will persevere. (It’s their one most teeth-gnashing virtue. They should have ended their Formula One misadventure years ago; lesser companies would have.) Think about it, however: AMG-like performance with Toyota-like reliability and operating costs.
Even if they did an IS-F with 500 horsepower, however, I still don’t think it will be the BMW M / AMG-killer they desire. All current Toyota products suffer from a distinct passion deficit–and it will be the same engineers doing the, um, engineering. You can’t just will a car to be a Ferrari; the passion–the soul–has to be embedded in the company culture from Day One.
September 12th, 2007 at 3:17 am
c/s Katie:
All Lexus are trying to do, in my opinion, is bring themselves more into line with their German competitors.
All the cool kids are doing it.
They’re just trying to meet the Germans..and IMO Infiniti on on equal ground. The have successes with the LS drawing in what would otherwise be S-Class/7-Series/A8 customers…why wouldn’t set your sights on AMG, M-Power and S line customers next? As is, well heeled Lexus customers have to swap brands when they want a toy..I’m sure Toyota is looking to remedy that.
My rear-guard against Infiniti theory is probably tinfoil lined armadillo helmet material to some, but I think it’s a factor as well. Toyota isn’t into rivalry IMO…Toyota is into winning.
It’s the only way to explain one brand dumping major ad dollars into a Prius and a Tundra with zero shame…every base covered under one roof. If there is money in any niche..there needs to be a Toyota to scratch that itch.
Toyota doesn’t want to be synonymous with “fast car”, “luxury car”, “hybrid car”,”sensible car” or anything of that sort…they want to be synonymous with “car” plain and simple. Like Google..to search..
September 12th, 2007 at 3:53 am
To all the people who seem to be picking on me.
My point was how can Lexus expect to be thought of in the same vein as their German competitors, if their product range isn’t the same? For Lexus to snatch sales away from “das motherland”, they must emulate their strengths (whilst providing brilliant service and reliability. Something which the Germans are lacking). It is while the Germans are weak, Lexus must capitalise. Get disillusioned customers over to them and don’t let them go. I’ve said it before on TTAC, why do people buy German cars, when Japanese cars are more reliable, better quality and cheaper, pricewise?
Lexus need to shake off the image of “Lexus is for Toyota customers with a bit more money” to being thought of as an individual luxury brand, like BMW. By creating a range of products which bear no resemblance to Toyota’s range that is a step in the right direction. Who wouldn’t like a car as luxurious and reliable as a Lexus but with the power of an AMG? Maybe “F” (which is a daft name, I agree) could be a engineering option like AMG is to Mercedes-Benz? So if you want a IS car you pay extra to have it engineered by “F”?
September 12th, 2007 at 5:08 am
“The Corvette a $50,000 to $60,000 car should be sold in Cadillac dealerships. At that price it IS a luxury vehicle like it or not.”
Caddy dealers should start selling Ag equipment as well then? Priced a big JD tractor lately? Price does not a luxury car make. As someone else pointed out, Porsche isn’t a luxury car, despite it’s high price.
To me Mercedes has no real market niche - is it a luxury car? Is it the well engineered car (no, it’s lost that aspect of it’s brand immage) is it a performance car? I don’t really know what it is. I guess it just depends on the model, and the options. There is no consistant brand immage.
Lexus should be careful about going down this road.
September 12th, 2007 at 6:39 am
Dynamic88 :
Lexus should be careful about going down this road.
In fact, they shouldn’t go at all.
And to all those people who keep saying Lexus will be able to pull this off, and will gloat when F cars are a raging success, remember: the chief argument against this move is that it damages the brand LONG TERM.
Do you think BMW would be the same today in terms of image and rep if they never came up with their M sub-brand?
Good question. And when you answer it, try and do so from the average consumer’s POV, not an enthusiast’s.
Better still, contemplate that question when considering the Mercedes brand. It’s been clear to me for some time that AMG products are what ALL Mercedes products should be– in terms of build quality and price.
Only now ALL Mercs are getting the AMG treatment. Do we think that’s a good idea? If you can see the flaw in that logic, then you’re halfway to understanding why Lexus needs to stick to the knitting.
September 12th, 2007 at 8:27 am
Here’s a video of the 2008 unveiling of the Lexus IS-F:
http://www.youtube.com/watch?v=0KecmtQ60Ic
My $0.02: Eight-speed, sport-shift transmission… jeez. Get a freakin’ clutch.
The exhausts are hideous.
I’m going to attending this year’s “Taste of Lexus” event. I’ll look forward to (perhaps) driving it. I sincerely doubt it’ll pull me away from BMW’s M3, or even the 335i, V8 or no.
September 12th, 2007 at 9:16 am
First article on TTAC I’ve whole-heartedly disagreed with. IMO Lex-yota saw available space in the market for people who wanted greater performance closer to Ss and Ms without the headaches of actually owning them (read: service costs and reliability). I should know - I’m that customer. I bought an A4 with the express intent of building a daily-driver-friendly road course car and was fanatical about attending track events at Road Atlanta; went to Petit LeMans every year to cheer on the R8s; devoured every bit of technical data I could about upcoming Audis, etc. Alas, I grew tired of things breaking long before their time and ENORMOUS repair bills for the things I couldn’t fix myself…not to mention Audi/VW’s notoriously poor dealership service reputation. I debated for a long time about replacing the A4 with the new S4 or M3, but I’d long known that BMW owners experienced much of the same things.
I didn’t much care for the first IS when it came out…it looked cheap and was too slow, and the aftermarket tuning available for it was (at the time) very poor. Then Lexus came out with the IS350 and I knew I’d buy one. It was gorgeous compared to the last car, offered more interior room, and the engine is beyond fantastic. So it only offered a paddle shift 6-speed automatic…I was willing to cave on that item at the time. I was making more money so the $43K price tag didn’t phase me. And you know what? I KNEW I wouldn’t have to deal with the reliability woes and astronomical repair bills I would’ve had to contend with if I’d bought the S4 or M3. And to top things off, I was getting 306HP for around $10K - $15K LESS, with a brand that has a MUCH better resale value track record. Audi resale value is atrocious, and some aftermarket warranty companies won’t even cover the brand. And yes, the Lexus dealership experience is everything typical car dealers are not - an unpainful one. They treat me like royalty…Audi dealers treat its customers like Beetle and Jetta owners.
So now Lexus wants to remove its foot from the door and kick the thing down - I say have at it. So they want to create a 420HP IS-F and cater to buyers like me. GREAT! I for one am done with the Germans until they get their reliability and resale woes worked out, and stop charging customers for the priviledge of letting them bend us over the service counter for a $400 MAF sensor or $300 door latch ring. The one page I wish they would’ve taken from Audi re: IS-F is to make the car only a subtle visual progression from the IS-350 a la Audi A4 to S4. The IS-F looks cheapened with the front wheel arch vents and gaudy front bumper. And the exhaust design is ripe for aftermarket clean-up.
September 12th, 2007 at 9:25 am
chris2 :
Thanks for sharing. But you are not Lexus’ target market. Nor should you be.
September 12th, 2007 at 10:27 am
Why shouldn’t Lexus extend it market with a performance division? Mercedes is in a similar market to Lexus (i.e. luxo barges with very little sporting character) and they are doing just fine with AMG. Sure, a Lexus F will never be BMW M substitute but then again, nor is AMG (nor is the S series from Audi) and it hasn’t stopped them from making a tidy profit from it.
The F designation should not be seen as a sports car but (just like AMG) a Lexus with a bigger engine, some (well controlled) vroom vroom noises, slightly stiffer suspension, auto only transmission (with a couple too many gears), good straight line performance and all the comforts and safety that made the brand popular. If this sounds like a prescription for timid dentist with a mid-life crisis you may be right and so may Lexus - there is a market for it. You may not call it sport or performance but it is a logical move as most luxury brands have a “performance” division and seem to be getting good returns.
September 12th, 2007 at 10:30 am
carguy:
One more time (this time with italics):
What's good for business is not necessarily good for a brand. At least not in the long term.
September 12th, 2007 at 10:52 am
Hey, RF
How can you claim that Chris2 is NOT Lexus’ target market?” He just wrote a clear and concise response spelling out how he is part of the Lexus’ current target. If he is not who exactly do you think is?
Like it or not the Japanese auto makers hold a great deal more clot with my generation (30 to 40)than I feel you give credit. Look, the days of the Babyboomers will come to an end as it is now! The German cars are nice but the Japanese have been quite successful proving to many of us just how over-rated most of them are.
Maybe the Babyboomer generation is still stuck on the preceived greatness of these marks but for us most of the “regular” Audis, BMWs, and MBs are “so what” cars. They just cost more for no justifiable reason.
One of the reasons Lexus is so successful is becuase they design and build cars for the “real world”. 99.9% of German car owners in America will NEVER drive their expensive depreciating status toy on a race track. Therefore they could careless about a BMW being able to pull .91g while the Lexus counterpart can only hold on for .88g. So what if your BMW is a 1/10 of a second faster than my Lexus. At the beginning of the day and the end of the day it is still just a car that we drive back and forth to work.
I have watched over the last decade as Acura, Infiniti, Lexus has continuously pushed the German maker closer and closer to the edge. We are reaching the point were Audi, BMW, and MB are actually trying to sell more dream and fantasy than car today. “Our cars will outperform their cars on the track!” Give it a rest already, at this rate the next generation M3/M5 will need to become pure racecars to keep ahead of Lexus!
In the magazines the writers like to crticize Lexus for not having handling as sharp as a BMW. In the real world most drivers tend to like the fact that the Lexus has a smoother more forgiving ride. And yes, it is an appliance! Just like most homeowers will pass on those new chicy looking kitchen appliances if they are unreliable, people do feel the same way about cars. Passion is great until it leaves you stranded on the side of the road, or your headlight just stop working for no reason on your $60,000 passion-mobile.
BTW: If I am correct Lexus has managed to pre-sell every one of its $100,000+ LS600. Need I say more!
September 12th, 2007 at 10:57 am
I agree with RF on this one. To me, Lexus is nothing more than tarted up, over-insulated Camry’s for the nouveau riche who can’t see past marketing gimmicks. The European brands have the heritage and reputation (Lexus racing?) to somewhat support their performance models. Lexus does not. Lexus appeals to the same people Toyota’s appeal to, but who want the snob factor and to drive a bed on wheels. They will be very confused by a Lexus that departs from this and ultimately be alienated.
September 12th, 2007 at 11:04 am
Mr Farago,
I’m confused, what are you trying to say(?) ;O)
You do have a point about brand and business not necessarily working together (i.e keeping prices high to keep a brand’s exclusivity but that’ll result in low sales). But I think Lexus creating a performance system is a corking idea and a good business model.
When Toyota re-entered the United States, they studied Detroit’s cars and american buying habits in order to provide a product which Americans would buy. They did it recently with the Tundra. It’s a tried and tested method for Toyota to copy a competitor and make the model better.
Now Lexus, created refined luxury cars (like the Germans), they’ve created a good cachet of cars (like the Germans) and they styled them to look desirable (like the Germans). But in addition, Lexus took quality and reliability to a whole new level (unlike the Germans). Now what would be the next logical step? To create a performance division (like the Germans). If Lexus are to be the Japanese alternative to the German luxury cars, they must emulate them before they can improve on the Germans.
The next logical step after a performance division would be to create a halo car. Mercedes have the S-Class which people look to to see what technology will be standard on all cars in about 10 years time. Lexus will need a car like that.
(Sits back and watches Mr Farago’s blood hit boiling point!) ;O)
September 12th, 2007 at 11:18 am
My 2 cents: RF is off the mark on this one. Like a few others above, I want all the comfort and refinement of a Lexus, none of the headaches that accompany every European make, and I want to go fast when I want to go fast. There are lots of people like me, and that is who is going to buy these cars. My next car will be the fastest Lexus I can buy, because my time is too valuable to be spent arguing with service departments, and I want to be coddled most of the time, and thrash about some of the time. I don’t care if there is an “F” in the name or not.
September 12th, 2007 at 11:20 am
I’m with NICKNICK and chris2…
I bought a BMW for the driving dynamics but I can do without the trips to the dealership for sunroof replacement, A/C replacement, car DOA on 3 separate occasions, etc.
At the time I didnt care for the boy racer looks of the IS300 and thought the rest of the brand was “soft”.
I have had my eye on the new IS line and think the F line is exactly what Lexus needs to balance its image. I want a sports sedan that is bullet proof. And I think Lexus is the brand to do it.
September 12th, 2007 at 11:30 am
26theone :
Sigh. I think what you guys REALLY want is better reliability and service from your BMW dealer.
Seriously. What if your BMW dealer was better than your Lexus dealer, and your Bimmer never broke. And just for kicks, let’s say model prices were the same.
NOW who would you buy?
September 12th, 2007 at 11:39 am
Mr Farago,
That’s a lots of “ifs”! IF your BMW dealer was better, IF your BMW never broke and IF the prices were the same!
Surely, the real issue is that BMW AREN’T doing any of these things which is why customers like Mr 26theone and Mr NICKNICK are looking for an alternative, which is where Lexus should present themselves as the superior alternative. But in order to do that, Lexus need to be a viable alternative to the Germans otherwise it won’t be much of an incentive to move to Lexus.
Maybe this should be the subject of a new editorial?
“Where did it go wrong for the Germans?”
September 12th, 2007 at 11:46 am
RF- Since we are in fairy tale land I will play along and say if BMWs were as reliable as a Lexus I wouldnt have any pause on getting another one. But if a Lexus can drive like a BMW why bother?
Also the BMW dealers arent really the problem. I can drop off my car and get a shiny new loaner to drive. Its the mfr not building as high as quality of car as Lexus.
September 12th, 2007 at 11:49 am
Thanks for sharing. But you are not Lexus’ target market. Nor should you be.
Heaven forbid a company try to capitilize on jaded consumers of competitors’ products and offer an alternative while simultaneously bringing new customers into the fold that would’ve otherwise not given them a look…customers that might see the value of the overall brand and perhaps one day buy LSs when they reach that tax and age bracket.
Sigh. I think what you guys REALLY want is better reliability and service from your BMW dealer.
Seriously. What if your BMW dealer was better than your Lexus dealer, and your Bimmer never broke. And just for kicks, let’s say model prices were the same.
NOW who would you buy?
Ahh, hypotheticals. Now you’re changing the rules and presenting a case that (a) doesn’t exist and (b) doesn’t apply because if it weren’t for those current issues (which existed and made Lexus viable to consumers when they launched 20 years ago, and continue to exist today), Lexus wouldn’t be where they are now…a tier 1 brand. HOWEVER, to appease you I will grant that Audi/BMW would keep some customers who would’ve otherwise bolted in the current state of affairs. Even then it doesn’t mean a company shouldn’t throw their hat in the ring and offer a compelling alternative to grow their clientele. My business experience tells me when you have the capital and clout to expand, do it. Toyota has that right now.
September 12th, 2007 at 12:17 pm
Rock-solid reliability and outstanding customer service are integral parts of the Lexus brand. A brand is never, never just about the product but the benefits (tangible and otherwise) of the entire ownership experience.
September 12th, 2007 at 12:17 pm
I’m reminded of a recent ad for a credit card company (which shows you the quality of their branding)…
An Asian American accountant confronts a craftsman working on some wood furniture. Have you seen THIS?” He holds a paper that contains some kind of report revealing expanding sales. “This means we’re going to have get more people and one of those [key card thingie motion] and more…”
“Wood?” a snooty artisan says.
“Wasn’t that the idea?” the head Zen tells the panicked bean counter.
Obviously, the business in question is a low-volume high-margin deal. What are the chances that the boss can hire artisans quickly enough to cover the necessary expansion? Judging from the pace of the work, not good. And that means quality will suffer. And that means their rep will diminish. And that will hurt their business.
Or perhaps they’ll introduce a cheaper range of mass market furniture to cater to the increased demand. And maybe it’ll sell well, since their hand-crafted stuff built them quite a rep. And then… their rep will suffer. And that will hurt their business.
At the same time, if the biz expands, the boss on the floor will lose touch with his original passion and expertise, as he’s forced to do more management and less hands-on stuff. His employees’ satisfaction will then diminish– to the point where quality suffers. And that will hurt his business.
The simple solution to this dilemma is… raise prices until the demand is back in line with production (or as in Ferrari’s case, slightly above). Done. More money for the same work. No hassle.
The idea that expansion is a good thing per se is a dangerous concept that has killed– is killing– many a once-thriving car company. If the ultra-expensive LS hybrid is selling well, excellent! But to think that carving-out a sub-niche to expand a high end brand is the way to go is madness. Madness I tell you. Madness.
For every example of a luxury company that has done so successfully, I can name you one that lived to regret it, from Pierre Cardin to Leica.
September 12th, 2007 at 12:23 pm
CSJohnston:
A brand is never, never just about the product but the benefits (tangible and otherwise) of the entire ownership experience.
Your point being? All those brand-related experiences are supposed to reinforce the brand. Which is… people’s expectations of the product and/or service.
Does anyone expect a Lexus to be a race car? HELL no. Does anyone want it to be one? Judging from the responses here, HELL yes. Should Lexus ignore this not-so-silent minority. Abso-damn-lutely.
September 12th, 2007 at 12:25 pm
I am simply going to make this point….
Why should Toyota allow the likes of Mercedes-AMG or BMW-M to have high performace luxury market to themselves?… it lends credibility to the rest of their respective line ups (halo effect) and infuses a sense of connectedness for the consumer with the world of motor-sports…
I know the typical Lexus consumer couldn’t give a rats ass about motorsports, but I am of the opinion that ‘f’ cars are not necessarily meant for the typical Lexus consumer…
Furthermore, it doesn’t matter that the ‘f’ moniker is silly (which i don’t think it is) or that the commercials are awkward (which they are), all that matters is that as people give the ‘f’ vehicles a chance they will realize MOST of the performance envelope they were seeking is well within reach of an ‘f’ vehicle + total and complete reliability.
I can honestly say, the IS-F is very high on my “most desired list or used cars I would happily purchase”… this is generally how I rate vehicles… Would I purchase an M3 with 50,000 miles on the odometer or a CLS55? I know the mfr’s aren’t necessarily targeting the used car market for their performance models, but this is in large part how you earn respect AND i don’t respect any technology that only performs within the safety of mfr warranty.
I will make this prophecy… 5 years from now, lets see how many IS-F’s are available on the used market and how many new M3’s are available… an IS-F likely won’t last 30 days on a dealer lot because it will be highly desirable because it will perform within 95% of an M3’s abilities, but you can drive it every day and never worry either… the ‘f’ division is exactly what Lexus was destined to do and I am happy they have started the process…
I also wouldn’t doubt Toyota has secretely already engineered a 8-9 speed dual clutch transmission to supplant those enthusiasts who will knock the ‘F’ cars for lacking a manual tranny…
September 12th, 2007 at 12:57 pm
Let’s see a Lexus Escalade - A Lexcalade
September 12th, 2007 at 12:59 pm
I know the commercial you’re referring to.
What are the chances that the boss can hire artisans quickly enough to cover the necessary expansion?
You’re an expert on the hand-made furniture industry now? How do you know they won’t be able to cope by hiring more workers? How from a 30 second commercial did you discern they don’t have processes in place to keep quality high? Something Lexus seems to have the knack of…fancy that. What I read from your line of reasoning is Lexus should’ve never ventured into the SUV market. Is the RX an abject failure of the brand’s proper direction?
At the same time, if the biz expands, the boss on the floor will lose touch with his original passion and expertise, as he’s forced to do more management and less hands-on stuff. His employees’ satisfaction will then diminish– to the point where quality suffers. And that will hurt his business.
The simple solution to this dilemma is… raise prices until the demand is back in line with production (or as in Ferrari’s case, slightly above). Done. More money for the same work. No hassle.
It’s funny how Toyota has done nothing but expand its reach over the last 20 years and eat GM’s lunch, yet this latest market share grab is somehow a horrendous idea.
Lexus struck a chord with buyers with the new IS. Go take a peek at your industry US sales data for the IS250/350 and compare it to the A4 over the same period. My guess is Lexus fared pretty damn well in the car’s first year out. I bought my 350 nearly a full year after it hit the showrooms and I had a REALLY hard time finding the one I wanted; many dealers’ 350s were still pre-sold before coming off the truck or lasted less than 5 days on the lot. So let’s review: the car was true to the brand in terms of value, reliability, and build quality…brought in new customers who never thought of looking at Lexus and were wowed by the experience, and sold and continue to sell well. You’re right, pure recipe for disaster, Mr. F! How dare they!
September 12th, 2007 at 1:24 pm
chris2:
You’re an expert on the hand-made furniture industry now?
Don’t be dissing the publisher. I know more than enough about artisans to make that call.
What I read from your line of reasoning is Lexus should’ve never ventured into the SUV market. Is the RX an abject failure of the brand’s proper direction?
I don’t know how you came to that conclusion. Lexus means luxury. Dynamically, I’m thinking loads of torque and… uh… that’s about it. A quiet engine? Easy steering? Anyway, I’ve got no problem with a luxury SUV. I’ll even spot you a luxury GT (which is what the SC is supposed to be). But a luxury high performance sports car? Porsche, schmorche; that’s a bridge too far.
It’s funny how Toyota has done nothing but expand its reach over the last 20 years and eat GM’s lunch, yet this latest market share grab is somehow a horrendous idea.
The operative word there is “Toyota.” Lexus is a luxury brand. Toyota is not.
I bought my 350 nearly a full year after it hit the showrooms and I had a REALLY hard time finding the one I wanted.
Ah, a fanboy. No matter. Just try to get your head around the idea that your personal predilection may not represent what’s best for Lexus. And– I know this is tough– that sales numbers are not always the ultimate arbiter of a brand’s success.
September 12th, 2007 at 1:30 pm
The operative word there is “Toyota.” Lexus is a luxury brand. Toyota is not.
By “Toyota” I meant Toyota and by extension, Lexus. I see no reason why Audi and BMW can tinker with Ss and Ms yet Lexus can’t dabble in it and see what shakes out. The three brands already fight for the same customers on other models. Again, Toyota has the capital to do it and they’ve determined it’s worth a shot.
I take offense at being labeled a fanboy for being particular about the options I wanted and having the patience wait for the right car when it was my hard-earned money paying for it.
And let the record show I no longer own a Lexus.
September 12th, 2007 at 1:38 pm
Seriously. What if your BMW dealer was better than your Lexus dealer, and your Bimmer never broke. And just for kicks, let’s say model prices were the same.
And if my aunt was bald, Farago, she’d be my uncle.
You keep asking for people to look at this issue, not from an enthusiasts’ point of view, but as the average consumer. Um, except the one looking at it most like an enthusiast… is you.
Why? Because the average consumer in the market for an RX/LS/GS isn’t going to look at the F and get confused; he or she simply sees a car they aren’t interested in. Are we supposed to believe a Lexus customer is going to look at a sports car and go “WTF? I don’t understand this brand anymore!”?
Why didn’t Lexus dilute their brand with the entry-level IS 250? Your specious logic would argue that LS and SC customers were upset and confused as well.
“Brand dilution” is the sort of buzzword pundits like yourself cop to. “Brand dilution” isn’t discussed amongst “average consumers”. The performance enthusiast may not buy a Lexus sports car but I’m sure the car will sell to same people who buy Ferraris and Porsches and Lambos and DON’T drive them the way they’re meant, but for the status and looks (you didn’t think that even MOST Ferrari and Porsche drivers are motorheads, did you? Most BMW drivers aren’t, either) without the hospital bills.
If Lexus can expand their vehicle line-up whilst consistently maintaining their reputation for luxury, quality and dependability, then more choice for the consumer = win. If, like its German counterparts, “expansion” meant a compromise in quality across their entire product line, then you can call it “brand dilution”. But at neither of these points do you cry, “pretend you’re an average consumer, please!” after stating an industry enthusiast/pundit’s premise—that’s just disingenuous.
Enthusiasts gave a shit about Porsche selling an SUV; average consumers who could afford it, made it the best selling vehicle in their line.
September 12th, 2007 at 1:46 pm
The performance enthusiast may not buy a Lexus sports car but I’m sure the car will sell to same people who buy Ferraris and Porsches and Lambos and DON’T drive them the way they’re meant, but for the status and looks (you didn’t think that even MOST Ferrari and Porsche drivers are motorheads, did you? Most BMW drivers aren’t, either) without the hospital bills.
DIIIIIING. bchat gets the gold star today. Southern California is the reason slushbox transmissions are such a high percentage of 911 sales in this country….and I’d argue the reason a 911 turbo exists in drop top form.
September 12th, 2007 at 1:47 pm
chris2: I take offense at being labeled a fanboy for being particular about the options I wanted and having the patience wait for the right car when it was my hard-earned money paying for it. I apologize for the remark.
It was not meant as an insult. I appreciate brand and model-related passion in all its forms. It's just that ownership can cloud one's vision (if not yours). Of course, it can also inform it. Anyway, remark withdrawn.
Now, as for this gold star for realizing that SoCal Porsche and Ferrari owners buy into brand perception (rather than worrying about actual capability), I think you're both making MY point. Those cars/brands make an entirely coherent statement, in which their owners' bask. If Lexus goes off chasing those customers, no matter how successful they are, they'll lose what made them different and special in the first place. What made them NOT Porsche and Ferrari.
A good brand does not go off and try to beat someone else at their game. It plays its own game better than anyone else.
September 12th, 2007 at 2:21 pm
Now, as for this gold star for realizing that SoCal Porsche and Ferrari owners buying into brand perception (rather than worrying about actual capability), I think you’re both making MY point. Those cars/brands make an entirely coherent statement, in which their owners’ bask. If Lexus goes off chasing those customers, no matter how successful they are, they’ll lose what made them different and special in the first place. What made them NOT Porsche and Ferrari.
But they aren’t really in danger of doing that in the first place, since no one’s going to confuse them with Porsche and Ferrari.
First of all I must say that the sort of brand-perception buying trend we’ve just discussed exists not only in SoCal—it exists everywhere Porsches and Ferraris are sold in this country. Americans like their slushboxes, period—they don’t care if it’s a Caddy or a 550.
Second, let’s not forget what made Lexus special–and it wasn’t by being different. It was by offering approximately the same product the Germans offered, but with better value and quality/reliability. Lexus’ unofficial motto could have very well been summed up as, “we’re the same but better.” They aren’t a car company with a particularly unique or edgy personality—they want to do what the next guy does, and beat him. That’s their game.
My point is that there are people who buy Porsches and Ferraris because they’re incredibly capable machines, and this Lexus isn’t for them. And Lexus isn’t kidding themselves by thinking so. But the 55 year old CEO who can do much better than a Vette for a mid-life crisis, wants a lot more class than a Viper, but wants a high end sports car that’s also a daily driver, would. And that’s what would make this Lexus special—like the others, it’ll be easy to live with.
I’m also looking at this car along the lines of the Acura NSX. And if I’m correct, I believe the price differential between the NSX and the next most expensive Acura was quite a bit larger than the one between what the F will cost, and the LS600h. So while I agree that from a performance/enthusiastic standpoint the car doesn’t make sense, looking at it as a well-heeled, average consumer, I think it does. Lexus might be pushing it, but I don’t think it’ll reach the point of brand dilution until it starts making a Corolla with leather, wood and nav.
September 12th, 2007 at 2:36 pm
RF, can you list some simple and convincing reasons as to WHY the F-sub brand will hurt the Lexus brand LONG TERM?
I stick to my previous point; if Toyota can manage to clearly differentiate and clearly define what an “F” car is compared to a regular Lexus, then there will be NO harm done *long term* to the Lexus brand. What you’re saying is akin to saying the performance Lexus hybrids will harm the brand because they do not fit as to what a “typical” Lexus is.
It’s quite obvious that not ALL Lexus models will get the F treatment. Only the more performance-oriented Lexus machines will get the F treatment. You will never see an ES-F or LX-F. You probably won’t see an LS-F either.
Going back to BMW and M, BMW is all about being the “ultimate driving machine”. It’s been BMW marketing for years and years now. What says “ultimate driving machine” in the BMW lineup more than an M car? The M models directly reinforce and help the marketing of the regular BMW models.
Since the very beginning, Lexus marketing has been about the “pursuit of perfection” in one variation or another. NOT the pursuit of luxury or the pursuit of comfort. The marketing of the F-brand will not clash with the image and brand marketing of the core Lexus brand, it will instead fit right into the “pursuit of perfection”.
And here is another reason why the F sub-brand won’t fail; it will offer something that has never really been offered before; high performance with high quality/high reliability and low maintenance.
AMG, M, Caddy V cars; they all have nagging quality/reliability/maintenance issues.
September 12th, 2007 at 2:43 pm
Your point being? All those brand-related experiences are supposed to reinforce the brand. Which is… people’s expectations of the product and/or service.
RF- My point was that people put different brand attributes in different orders. To a hard-core BMW or Porsche owner it may be that performance trumps all and things like quality/reliability or customer service might be relegated to unimportant. To others, those attributes may have more equal footing.
Let’s face it, there is a legion of consumers who buy a BMW or Porsche for “non-sporting” reasons. If the Lexus brand has a sufficient level of cachet to them and the product/service experience is better then they will become Lexus Loyalists too.
I think that was my point anyway.
September 12th, 2007 at 3:03 pm
Sorry RF, I still don’t understand why you’d think that the F series would damage the brand. Other luxo car companies including Audi, Mercedes have done the same without risking their brand image. I would argue quite the opposite, both Audi and Mercedes’s image probably benefited from their venture into muscle Euro cars.
What is it that you think would hurt Lexus’ image if they fitted a V8 to an IS sedan? What would you say the precedences are for your view that this would hurt their image? Would it confuse their middle class suburban clientele? This is not quite like Porsche building an SUV, it’s just slapping a bigger engine into an existing car and calling it sport.
September 12th, 2007 at 3:26 pm
Sorry RF, I still don’t understand why you’d think that the F series would damage the brand. Other luxo car companies including Audi, Mercedes have done the same without risking their brand image. I would argue quite the opposite, both Audi and Mercedes’s image probably benefited from their venture into muscle Euro cars.
To take things a bit further, it would only strengthen Lexus’ status in the industry if they can offer the F models and take the German Ms and Ss to task while maintaining their penchant for quality/reliability and fantasitic dealer experience. We’re not talking about a $200,000 supercar here…in the case of the IS-F at least, just an IS with a little mustard on it. Think of it this way, Robert…when the IS350 was announced, what cars were all the pundits, car mags, and gear heads instantly sizing it up against? It wasn’t the A4 and 330i, it was the S4 and M3. It wasn’t exactly a fair comparison since those cars offered greater balls-out performance (and a passionate following to boot)…so now Lexus takes it a step further and breathes a little fire on the IS to give those people something to chew on. In the end, I believe the likely result will be that customers will have an alternative in the sport/lux sedan market from a brand that everyone on Earth knows is renowned for doing what those other guys can’t or won’t get right - building a quality product that rarely needs the hood popped or being at an altitude of 4′ off the ground on a regular basis.
September 12th, 2007 at 3:35 pm
I don’t see this as being enough of a change to create dissonance or confusion about what the brand is. The Cimmaron and Phaeton are two examples that I can think of which caused confusion about a brand. But I’d also say that only the Cimmaron really did any damage to it’s brand. Even the NSX is an odd fit to me, not really at all like other Acuras, but I can’t see how it damaged the brand.
To me at least the F cars are a much better fit for what Lexus is/should be than the LX/GX are. Get rid of the body on frame SUVs and add a couple hot versions of the sedans and that would be perfect. Actually Cadillac should do this too. I think the Escalade as successful as it’s been is doing more damage to the Cadillacs brand than those sales are worth.
September 12th, 2007 at 4:05 pm
“Why didn’t Lexus dilute their brand with the entry-level IS 250? Your specious logic would argue that LS and SC customers were upset and confused as well.”
They did dilute it. And some LS/SC owners are upset because now even people like me can join the Lexus club ( if I wanted to - which I don’t) . LS/SC drivers don’t want to belong to a club that would have me as a member. I shouldn’t be able to choose a Lexus, I should be precluded by financial reality. I should only be able to drive an Avalon, (or maybe just a fully loaded Camry) and jumping up to a Lexus should cost more than I can afford. Where’s the snob appeal in driving the same brand a guy like me is driving?
“I stick to my previous point; if Toyota can manage to clearly differentiate and clearly define what an “F” car is compared to a regular Lexus, … ”
IOW, if they can make the F a separate brand - which they can and should do. But to make it a separate brand, it needs a separate brand name.
I’m not sure why so many people are oppossed to the idea of creating a separate brand. I would ask all of you this question - what’s the purpose of Scion? Why didn’t Toyota simply come out with a Toyota XA, Toyota XB, and so on?
If a separate brand for Lexus’ performance division is a bad idea, then Scion is probably a bad idea as well. An automaker should just trade under one name, with as many different models as they wish.
OTH, if Scion isn’t a bad idea, then Lexus coming up with another brand - for a different segment of the auto market- probably isn’t a bad idea either. The “F” brand could still be sold at Lexus dealers the way Scion is sold at Toyota dealers.
Keeping in mind that Lexus is a luxury/snob appeal car, which if any of the following should Lexus not build?
- Lexus Laris. A Yaris like small economy car with luxury appointments such as heated massaging leather seats.
- Lexus LT. A competitor to Lincoln’s Mark LT. Any reason Lexus shouldn’t build a luxury pickup? (Can you say platform sharing? I knew you could)
- Lexus XB. A luxury little boxy van like vehicle.
- Lexus GT40. You know where I’m going with this one.
- Lexusbuilt. A luxury competitor for truck drivers who want a bit more class.
-Lexourghini. A luxury/reliable 250 mph gull wing coupe.
September 12th, 2007 at 4:30 pm
They did dilute it. And some LS/SC owners are upset because now even people like me can join the Lexus club ( if I wanted to - which I don’t) . LS/SC drivers don’t want to belong to a club that would have me as a member. I shouldn’t be able to choose a Lexus, I should be precluded by financial reality. I should only be able to drive an Avalon, (or maybe just a fully loaded Camry) and jumping up to a Lexus should cost more than I can afford. Where’s the snob appeal in driving the same brand a guy like me is driving?
The snobbery of some LS and SC owners not enjoying an IS250 driver in the same club hardly makes a case for brand dilution, any more than S-Class drivers scoffing at the C-Class makes for the brand dilution of Benz. We’ve gone from looking at this from the perspective of an “enthusiast”, to the “average consumer”, to now the “douchebag” (not you, D88, but these aforementioned LS and SC owners).
Scion is a poor example of brand separation for this argument, since it was created to serve a demographic on the completely opposite end of the Lexus spectrum. Backing a new brand selling $15,000 cars is a very different ball game from one selling $150,000 cars. Purchasing attitudes are wildly dissimilar on both those ends, and establishing the latter over the former is a feat that took Lexus decades to accomplish.
You can’t find many examples of established luxury automakers creating a new, separate brand to sell even higher-end products because it isn’t a model that works (Maybach). When most people spend 100k or more on a car, “reputation” becomes more akin to “heritage”. They’re buying a car from a company with a history, and these car companies generally ride that ticket for all it’s worth.
September 12th, 2007 at 4:47 pm
RF,
You are starting to sound like your favorite people, Lutz and Wagoneer! Or better yet those former execs at MB in 1989 that said no Toyota product would ever be a threat Mercedes Benz.
What is the problem? Some of us actually have a passion for Japanese cars. You know they do do somethings better than the Germans. They also manage to create magic for 2/3 the price of the German competition.
Read the posts from your readers here and you will see that the German makers can easily find themselves in the same sinking ship as Detroit if they do not get their collective act together in terms of relaibilty and quality.
Passion is great, but with everything in life including cars if the passion is accompanied by a great deal of unwanted drama it quickly turns into pain!
There is nothing worst than something that stirs up your passions and emotions only to disappoint you in the end. A unreliable faulty expensive luxury or sportscar is just that a P in the A.
I sure there are many folks here who at the very least experienced this with the purchase of their first used car.
I have fallen in love with some beat-up cars that ran flawlessly and have had my heart broken by some beautiful cars that were absolute junk underneath the skin.
“If it dont work it aint no damn fun!”
That is why Toyota and Honda are so successful today.
September 12th, 2007 at 5:03 pm
You can’t find many examples of established luxury automakers creating a new, separate brand to sell even higher-end products because it isn’t a model that works (Maybach).
Bingo. It serves no purpose to create another brand for limited production performance-oriented cars, because people willing to plunk down the extra money to get those are left to contend with a brand that has no history at all and wondering what the ownership experience will be like. Plus, we’re talking about vehicles that are variations on existing models; a new brand would require far greater changes or even new platforms from the Lexus models to fully differentiate itself from the other brand’s cars (read: FAR more investment, to the tune of hundreds of millions of dollars to create the brand/dealerships and then vehicles themselves.) By comparison, the cost of what Toyota is doing with Lexus here is a mere pittance of going the route of a new brand. I believe they’re counting on Lexus’ (relatively short but highly successful) 20 year history of quality, reliability, and first-rate service to help sell the cars to people with the means and perhaps even the bad taste in their collective mouth of prior ownership of a BMW or Audi. That is certainly what drove me to look into the IS.
Audi is now bleeding a bit into their other brand (Lamborghini) with the R8, but it works from the standpoint of having a rich racing history and a full stable of performance models that are massaged versions of their basic family sedans (A4 -> S4/RS4, A6 -> S6/RS6, A8 -> S8) while being priced far less than a Gallardo.
September 12th, 2007 at 5:14 pm
“The snobbery of some LS and SC owners not enjoying an IS250 driver in the same club hardly makes a case for brand dilution, any more than S-Class drivers scoffing at the C-Class makes for the brand dilution of Benz. … ”
What is brand dilution then? When a brand which exists only for snob appeal (otherwise why not drive a Toyota?) fails to remain exclusive, then I call that brand dillution.
“Scion is a poor example of brand separation for this argument, since it was created to serve a demographic on the completely opposite end of the Lexus spectrum. … ”
I think the argument holds, because brands serve different pruposes, they exude different immages, emotions, “benefits”, at either end of the spectrum.
“You can’t find many examples of established luxury automakers creating a new, separate brand to sell even higher-end products because it isn’t a model that works (Maybach). When most people spend 100k or more on a car, “reputation” becomes more akin to “heritage”. They’re buy