QOTD: Why There Will Be No "Made In China" Lexus Products

Derek Kreindler
by Derek Kreindler

Currently, there is only one Lexus plant outside of Japan. A Toyota factory in Cambridge, Ontario makes the Lexus RX crossover, while Toyota’s Georgetown, Kentucky plant will come online in 2015. Like other Japanese auto makers, Toyota is moving towards a localization of its production facilities, but one thing they won’t be doing is producing Lexus vehicles in China.

Speaking at the Beijing Auto Show, Lexus head Tokuo Fukuichi said

“We are often asked whether we plan to manufacture Lexus cars in China. But the question is whether our brand has earned the trust of customers. If a brand is really trusted, it can sell its products wherever they are manufactured. But Lexus has not yet achieved such a status.”

Building an automotive luxury brand is a decades long process. Audi is an overnight success nearly 40 years in the making, while Infiniti is now on the slow, long road to lifting themselves up out of the doldrums of Tier 2 luxury. Lexus has arguably been the most successful Japanese effort at a Tier 1 luxury brand, but they still have work to do. In world markets (specifically Western Europe), Lexus does not enjoy the same footing as it does in the United States, and has only been on sale in Japan since 2005.

In Fukuichi’s estimation, Audi, BMW and Mercedes-Benz (not to mention, Cadillac and Infiniti) can all do what Lexus cannot: build cars in China without harming brand perception. This is a big problem for Lexus – it must import its cars from Japan (and the NAFTA zone) and sell them at a higher price thanks to import tariffs and other duties. But it’s also a deliberate calculation on the part of Lexus.

If any of the German brands suffered quality problems from Chinese made cars, their customers would likely forgive them, due to the burning desire to have four rings, a three pointed star or two blue triangles on the hood of their car. But nobody feels the same pull for the stylized “L”.

Derek Kreindler
Derek Kreindler

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  • Dimon Dimon on May 05, 2014

    I think Toyota got this one right - Lexus is not an aspirational brand but a deliberate choice of the many who want to buy the ultimate Toyota that's built to last. Assembling in Japan is part of that. On the other hand Germans are mostly leased as status symbols, ultimate driving machines, you name it and are supposed to last through the warranty alright - prepaid maintenance and all... Place of assembly doesn't really matter. Heck, they have been assembling MBs and BMWs in South Africa for a while now and most of their US lessees are not even aware of it, let alone mind it. Try to imagine what a 'Made in Africa' Lexus would do to a brand reputation. PS. On a serious note objectively there is nothing wrong with S. African assembly per se other than the subjective perception.

  • Superdessucke Superdessucke on May 05, 2014

    The whole economic "wonder" known as China will cave in on itself as soon as the workers get tired of being paid nothing and everyone gets sick of coughing up black phlegm. 5 years? Maybe 10 at most?

  • Ronin It's one thing to stay tried and true to loyal past customers; you'll ensure a stream of revenue from your installed base- maybe every several years or so.It's another to attract net-new customers, who are dazzled by so many other attractive offerings that have more cargo capacity than that high-floored 4-Runner bed, and are not so scrunched in scrunchy front seats.Like with the FJ Cruiser: don't bother to update it, thereby saving money while explaining customers like it that way, all the way into oblivion. Not recognizing some customers like to actually have right rear visibility in their SUVs.
  • MaintenanceCosts It's not a Benz or a Jag / it's a 5-0 with a rag /And I don't wanna brag / but I could never be stag
  • 3-On-The-Tree Son has a 2016 Mustang GT 5.0 and I have a 2009 C6 Corvette LS3 6spd. And on paper they are pretty close.
  • 3-On-The-Tree Same as the Land Cruiser, emissions. I have a 1985 FJ60 Land Cruiser and it’s a beast off-roading.
  • CanadaCraig I would like for this anniversary special to be a bare-bones Plain-Jane model offered in Dynasty Green and Vintage Burgundy.
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