Toyota Motor Corp. unleashed the Lexus LS, its flagship model, on Japan on Tuesday in hopes of improving flagging sales of the internationally known brand, which has not lived up to expectations here since debuting in August 2005.
Despite its huge success in the United States, total Lexus sales in Japan stood at 15,079 at end of August — barely half Toyota’s target of 30,000 for the entire year.
However, Japan’s top automaker boasted that it already has about 9,000 reservations for the LS460, which is close to its initial sales target of 10,000 for the year. Worldwide, Toyota aims to sell 20,000 LS460s.
The LS460 is fourth model in the Lexus lineup after the GS, IS and SC.
Because Japanese consumers have been infatuated with minicars lately, the market for other vehicles has been shrinking steadily. But Toyota President Katsuaki Watanabe said the LS will likely give the luxury car market a shot in the arm.
“I am confident that the new model will boost the premium car market,” he said.
According to Toyota, average monthly sales of luxury cars expanded from 12,000 units in 2004 to 14,000 units as of the end of August.
The LS460 comes with a 4.6-liter V-8 engine and eight-speed automatic transmission. It features a radar system that helps detects pedestrians, vehicles and other obstacles. The LS460 starts at 7.7 million yen, depending on options.
Toyota said it will launch a hybrid version of the Lexus LS next spring.
Honda grows in China
Bloomberg Honda Motor Co., Japan’s third-largest automaker, opened a new factory in China on Tuesday as it seeks to maintain its lead over Toyota Motor Corp. and Nissan Motor Co. in the world’s fastest-growing major vehicle market.
The new factory, in the southeastern city of Guangzhou, will have a capacity of 120,000 vehicles per year, the company said in a statement. Guangzhou Honda Automobile Co., Honda’s venture with Guangzhou Automobile Group Co., invested 2.2 billion yuan in the plant, which will make Accord models.
Honda, the first Japanese carmaker to set up a venture in China, is opening the plant after capacity shortages stunted its sales growth in the first half of the year. The factory may help Honda maintain its lead over Toyota and Nissan, which are also investing in the China, now the world’s third-largest vehicle market.
“Demand in China will continue to grow, so Honda will likely add more capacity,” said Norihito Kanai, a senior research analyst at Meiji Dresdner Asset Management Co. “If Honda can’t supply enough cars, customers will go elsewhere.”
Honda set up its first venture in China in 1998, five years ahead of Toyota and Nissan. The company had about 5.7 percent of China’s car sales in the first half, compared with Toyota’s 4.5 percent and Nissan’s 4.1 percent, according to the China Association of Automobile Manufacturers. Market leader Volkswagen AG had a share of 17.1 percent.
Guangzhou is the only city in the world where all three major Japanese automakers have assembly plants, according to Koji Endo, a senior analyst at Credit Suisse in Tokyo.
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