Lexus Could Move Production Stateside - Japanese Government Ready To Help

Bertel Schmitt
by Bertel Schmitt
lexus could move production stateside japanese government ready to help

Toyota is serious thinking of breaking a taboo. It is considering moving some production of its Lexus luxury brand from Japan to the United States, says Reuters. The oddest part: The Japanese government might help Toyota to move the jobs out of the country.

A likely option would be making the Lexus ES in the United States instead of Japan, Toyota’s U.S. chief Jim Lentz told Reuters. “With where the yen is today, I think it’s only a matter of time” before Toyota moves more production to North America, particularly to the United States, to have assembly nearer to the U.S. market, Lentz said.

The Japanese government said yesterday it would extend its dollar credit facility, which helps Japanese companies invest overseas.

Except for the Lexus RX crossover, which is built in Ontario, Canada, all of the Lexus production is stubbornly kept in Japan. Most of the Lexus sales are abroad, especially in the U.S.A. Privately, executives at Toyota always maintain that this is in order to keep the quality high. This decision has cost Lexus sales and profits, especially in China, where imported cars carry high duties.

Lentz said that in addition to the strong yen, moving production would be driven by engineering capabilities in the United States. At Toyota’s engineering center in Ann Arbor, Michigan, more than 1,100 engineers are employed.

On July 6, 2012, the first 2013 Lexus ES rolled off the line at Toyota’s Miyawaka plant (picture.)

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14 of 22 comments
  • 28-Cars-Later 28-Cars-Later on Aug 08, 2012

    There it is, the last reason to buy a Lexus over a Toyota... Made in Japan.

    • See 5 previous
    • El scotto El scotto on Aug 09, 2012

      28-Cars-Later I used to work in the automotive parts inspection field. I've seen parts factories make parts that went to American and Asian manufactures. Same parts, same specs, same inspections. Did the Americans get better, did the Asians lower their standards, or was it a good part to begin with?

  • Jonathan H. Jonathan H. on Aug 08, 2012

    There's been talk around the plant in Georgetown, KY for the past couple years of squeezing a Lexus model onto the existing assembly line. Just rumors though.

  • Sportyaccordy Sportyaccordy on Aug 08, 2012

    What is going to become of Japan? Their manufacturing companies are either in their last throes (Sony, Mitsubishi, Suzuki etc.) or packing up and heading for cheaper pastures (Toyota, Nissan, Honda). GDP growth is all over the place. What's the deal???

  • Carbiz Carbiz on Aug 08, 2012

    The old cronies still kicking around from MITI must be choking on their saki! What has the world come to? Who'd a thunk that Bank of Japan yen would be used to put jobs BACK in America? Maybe there isn't enough electricity to light the homes, let alone the factories? After all, running on natural gas is not a cheap option if they shut down their entire nuclear network. (At least Germany has France's nuclear power to rely on.) Then again, Toyota does have that shiny, new $1.2B factory in Texas that is growing tumbleweeds these days.....

    • See 3 previous
    • George B George B on Aug 09, 2012

      @Diewaldo At least in my corner of the US there is significant investment in new infrastructure. The difference is a big part of the infrastructure is being built by private companies for private companies that plan to get a good return on their investment. New roads. I-635 expanding from 8 to 14 lanes. Room to drive a US built Lexus. I have to drive through this road construction plus the privately funded Dallas North Tollway this afternoon. New natural gas power plants. George Mitchell spent 18 years and many millions of his own dollars to figure out how to get natural gas out of the Barnett Shale at a profit. Sold his company to Devon Energy and became a billionaire. His gas is helping power my computer right now.