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Lexus in no hurry to be a big player in China

For a while now, China's spiraling wealth, population and development has had the world's luxury automakers in an expansionist fervor, with many executives exhibiting the sort of gleefully maniacal behavior historically reserved for gold-rush prospectors. Yet Toyota, of all companies, is exercising a surprising amount of caution in the Asian nation.
As The Wall Street Journal notes, Toyota's premium brand, Lexus, sold all of 64,000 vehicles in China last year, while BMW cleared its books of 326,000. In fact, it didn't even bother entering the market until 2005, while rival Audi built its first car in the market a decade and a half earlier. Even now, Lexus doesn't build any vehicles in China, and with the country's notoriously high tariffs on imports, that's a major disadvantage. Yet the business daily quotes Lexus executive vice president Mark Templin as saying that the brand is nowhere near ready to start building cars in the market. "We're not having those discussions about when we're going to go to China... We have a lot of work to do before we get to that point."
Part of that work includes establishing a more expansive dealer network - Lexus only had 99 stores as of 2012, while rival Mercedes-Benz had over two-and-a-half times as many, and it's still expanding. Adding a lot of dealers without having a goodly number of competitively priced offerings for them to sell may seem like an odd strategy, but Templin tells the WSJ that the goal is to "cultivate our image for quality and customer service and let the customers that we have go tell that story for us."

Lexus CT 200h could be replaced by sub-compact hybrid CUV

The Lexus CT 200h is an interesting vehicle that never really caught on. It's a sporty Prius in sleeker hatchback clothing and was aimed at the Audi A3 when it hit the market in 2011. Since then, though, the CT has averaged a meager 16,000 sales per year. For that reason, the hybrid hatch won't be redesigned at the end of its life cycle. And according to Lexus' European brand boss, Alain Uyttenhoven, it could be replaced by a crossover. While you may lament yet another CUV hitting the market, Lexus needs a small car that sells in big numbers. Uyttenhoven told Autocar the brand aims to move 100,000 units per year in Europe to "give us visibility in the market." For 2016, European sales are on pace to hit just 70,000 units, with 10,000 of those coming from the CT 200h. He sees an opportunity for the right little Lexus based on the recent nature of the European luxury market. View 29 Photos According to Uyttenhoven, "a full 50 percent of the European luxury car market exists below the [$44,600] mark," and the only model Lexus has at that point is the CT. Put another way, the company has a remarkably slow seller as its sole representative for half of an entire continent's luxury market. Enter the crossover. Replacing the CT with a crossover makes a great deal of sense. The body style is getting more and more popular by the day, especially in the sub-compact and compact markets. Adding a smaller model – below the current NX crossover but larger than the LF-SA concept shown in Geneva – would allow Lexus to challenge the Mercedes-Benz GLA, the BMW X1, and the Audi Q3. We're betting the small crossover would use the Toyota C-HR as its basis and add a Lexus-correct heavily creased skin. Hybrid power is a given for the European market, where almost all Lexuses sold are gas-electric, but a conventional gas variant could join it in the US. That would give Lexus three hybrid CUVs in three popular sizes, alongside the NX and RX. With a forthcoming RX-based three-row on the horizon, the brand would have a full lineup of crossovers ready to take over the world. We'll miss the quirky CT when it goes, but it's hard to stop volume-driven progress. Related Video:

Lexus: Make Some Noise

The 2015 NX is a seriously important vehicle for Lexus, as it not only moves the brand into a new segment, but pushes it towards a younger demographic. The Japanese brand's 2015 Super Bowl ad reflected these facts, with an expressive, stylish spot that focused on the aggressive lines of its new crossover. It's not a funny spot (which is kind of the modus operandi for Super Bowl ads), but it gets the turbocharged CUV out in front of the masses. Take a look at our full drive on the all-new NX200t.