Toyota has already stated its intent to produce more vehicles in North America, and dealers are specifically requesting that Lexus consider the ES as a candidate. Building the car here will ensure better profitability, as a strong Japanese yen and weak U.S. dollar have raised the dealers’ cost of inventory and hurt Toyota’s margins.
As Ward’s Auto points out, there’s one significant problem with that plan: there isn’t excess capacity at any of Toyota’s North American manufacturing facilities. That could mean that the time is right to expand Toyota’s North American production capabilities, particularly in light of the ES’ importance to Lexus’ bottom line.
When the 2013 Lexus ES goes on sale in August, the U.S. is expected to take roughly 50-percent of the production. Since the ES will offer more luxury than the previous version, as well as a hybrid drivetrain option, Lexus expects to attract both new buyers (primarily with the ES Hybrid) while retaining existing customers.
In addition to conventional advertising, look for Lexus to promote the new ES via live engagement marketing, too. The entry-level luxury segment is a crowded one, so Lexus will need to pull out all the stops to get the ES noticed.