Vested Interest -- Jeff Bracken addresses his first Lexus Dealer Meeting as the division's general manager.
Are Lexus vehicles cool? Are they aspirational? Works of art? Marvels of engineering? Exceptional? Emotional? Even heart-pounding? When it’s all said and done, are they tanoshi,
which is Japanese for “fun?”
Those are the words Lexus’ leaders used to describe the products in the pipeline during last week’s Lexus National Dealer Meeting in New Orleans. If all goes as planned, Lexus’ customers will soon use those words, too.
“Lexus has built a great reputation for producing exceptional luxury cars, for defining luxury treatment and for providing magnificent and luxurious facilities,” said Jeff Bracken, group vice president and Lexus general manager. “But there’s a missing ingredient in that mix that holds us back from being a true and complete luxury brand. That missing ingredient is performance—heart-pounding, hair-on-fire, pinned-to-the-back-of-your-seat performance.”
Toyoda: ‘I Risk My Life for Lexus!’
Bracken said the all-new 2014 IS hints at where Lexus is heading. Akio Toyoda, president and chief executive officer of Toyota Motor Corporation, assured dealers he is clearing the way for more such vehicles to follow.
Actually, Toyoda’s role is a bit more proactive—and provocative—than that.
“For a car guy like me, the promise of Lexus is the fulfillment of every dream I ever had as a kid,” said Toyoda, known for personally test-driving new vehicles as well as competing on the racetrack. “If you’re addicted to the high of driving at 180 miles per hour, then you have some sense of why Lexus is so important to me. It’s why, in fact, I risk my life for Lexus!”
Lexus’ dealers were given a glimpse of what this more performance-minded product lineup will look like. It holds the promise of building on Lexus’ current momentum, with sales this year on pace to exceed 270,000 in the U.S, good for a 13 percent increase in sales and a 15 percent share of the luxury market.
Investment in People, Facilities Pays Off
New products aren’t the only reason Lexus is poised for more growth in 2014. Steve Hearne, vice president of Lexus sales and dealer development, noted that over the last year Lexus dealers have invested more than $250 million to add almost 1 million square feet of operating space, increase service capacity by 60 percent and hire and train some 2,000 Delivery Specialists and 600 Technology Specialists.
Hearne said the latter played a key role in keeping Lexus atop the J.D. Power and Associate’s Sales Satisfaction Index and Customer Satisfaction Index. The brand did rank third in the Initial Quality Study, but even that was a victory of sorts.
“Ford introduced My Ford Touch and fell from 5th
,” said Bracken. “Cadillac introduced CUE and fell from 4th
. We introduced Lexus Enform with Apps Suite and yet were still the best luxury brand in the study after Porsche. The specialists did exactly what they were supposed to: help each of your customers understand all of our new and innovative technology.”
The Prosperity of Diversity
Kazuo Ohara, TMS president and chief executive officer, said Lexus’ prospects look even brighter the further you cast your gaze down the road. He cited demographic trends that suggest the U.S. population will grow by at least 100 million people by 2050 and that 93 percent of that growth will be from an increase in diverse cultures.
“Financial analysts project the buying power of these diverse cultures will reach $4.4 trillion in just two years,” said Bracken, picking up on the theme. “That’s why we’re accelerating our multicultural initiatives in strategic markets.”
Fearless Leader -- TMC President and Chief Executive Officer Akio Toyoda, known for test-driving vehicles in development, pledges to pump up the performance of Lexus.
But Toyoda made it clear that, when it’s all said and done, Lexus’ future will ultimately depend on the performance of its products.
“It’s not just a single element like horsepower,” he said. “It is how all the parts work together, from the suspension, to the acceleration, to the sound of the engine, to the tuning. So we will have horsepower for sure. But we will also look at performance as a whole to deliver a truly superb driving experience for our customers.”
“This is only the beginning,” he concluded. “Let’s take this brand of ours—this partnership of ours—to a whole new level. We can be everything that we want to be, everything that we should be. Let’s settle for nothing less. Because, ladies and gentlemen, we are
By Dan Miller