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Lexus Oz eyes compact SUV

Left: LF-Xh Hybrid Concept from Paris motor show 2008.

BMW X1 fighter a priority for Lexus as top-shelf Toyota brand ramps up Aussie range

29 Mar 2011

A COMPACT luxury SUV is back on the Lexus agenda as Toyota’s prestige arm prepares a wave of new models to take the battle up to the dominant German brands over the next few years while also fending off a renewed assault by Nissan’s Infiniti and GM’s Opel luxury brands in 2012.

The BMW X1 competitor is a hot priority for Lexus Australia, which does not want to be left behind by buyers migrating to small but luxurious soft-roaders – a fast-growing category that is set to be revved up by the all-new Audi Q3 in coming months.

This year, the X1 has achieved 336 sales, making it the fourth best-selling luxury SUV on the market behind the Audi Q5, BMW X5 and Audi Q7.

Fresh from adding two new bookends to the Lexus range this week, with the introduction of the entry-level CT200h hybrid hatch and the limited-volume LFA supercar flagship, Lexus Australia is already looking to future models to add both gloss and volume to its local offerings.

A new Lexus GS sedan is set to break cover at the New York motor show next month, in the form of the LF-Gh hybrid concept, ahead of its production rollout next year, while a new version of the Lexus’s best-selling IS medium sedan is also in the 2012 pipeline for launch as a 2013 model.

A big-bore 2.5-litre CT300h is also likely, to give a performance alternative to the frugal 1.8-litre petrol-electric CT200h that has only just entered global markets, including Australia, where pricing starts at a hot $39,990.

Lexus Australia chief executive Tony Cramb told GoAuto his company expects to be able to make an announcement on a new Lexus model soon, with others to follow.

“There’s a couple of key ones that we are seriously talking with TMC (Toyota Motor Corporation) about at the moment,” he said. “We should be able to announce at least one of them shortly and, before too long, hopefully more.”

Mr Cramb confirmed that a compact SUV was one area that he would like to see covered in the local line-up.

“That is definitely an area we are going to have to deal with,” he said. “There is nothing that we have formally announced at this time, but it is clear that we will need to do something in that area.”

31 center imageFrom top: Lexus Australia chief executive Tony Cramb, Lexus RX450h, Lexus CT200h, BMW X1.

Lexus shelved its compact luxury SUV project in the global financial crisis, instead giving priority to the CT200h – the brand’s new sub-$40,000 hybrid hatchback – which was seen as a more urgent addition, especially in Europe.

But with the success of the X1 and similar offerings, Lexus is revisiting the small SUV project that is likely to be based on Toyota’s popular RAV4, sitting below the mid-sized RX which is the brand’s second most popular model in Australia after the IS.

The Lexus decision to go 100 per cent hybrid with CT hatch also would indicate that any compact SUV might be exclusively electrified, powered by a similar powertrain to the third-generation petrol-electric system in the CT200h or more powerful CT300h.

A full-electric version might also be on the cards, as Toyota is already trialling a RAV4 EV in the United States ahead of planned production rollout there in 2012, possibly in conjunction with the introduction of the fourth generation of Toyota’s popular compact SUV.

The prototype RAV4 EV, powered by advanced lithium metal oxide batteries, was developed jointly with Silicon Valley EV specialist Tesla Motors, of which Toyota is a major shareholder and technology partner.

If a Lexus compact luxury SUV is to emerge this year, it is likely to be shown in concept form at one of the big motor shows in the second half of 2011 – possibly Frankfurt in September or Tokyo in December.

As Lexus habitually shows concepts about 12 months ahead of production – the RX SUV launched in 2008 was shown as the LF-Xh in October 2007 – then the global launch might be expected in the second half of 2012 as a 2013 model.

For now, Lexus Australia is depending on the new CT200h to help it achieve its volume aspirations this year.

Although Lexus officially says the CT is charged with becoming one of the brand’s top-three sellers in this market, Mr Cramb said the CT might end up being Lexus’ number one, as long as it can get its hands on sufficient stock.

A queue of 300 buyers has already exhausted the initial delivery to Australian dealers, and some of them are facing a wait of up to three months for delivery.

The Japanese earthquake that stalled car production across that country on March 11 is also likely to put a two-week hole in production, although Toyota hybrid production resumed this week.

“It (the earthquake) will have some impact on our overall sales for the year,” Mr Cramb said. “But if things stay the way they have been, we will soon catch up.”

A bigger problem for Lexus Australia might be demand from Europe and North America, where, according to Mr Cramb, CT200h customer enquiry has exceeded supply, raising the spectre of rationing to other markets.

“The car has gone ballistic – I may not be able to get supply,” he said.

Mr Cramb said he was happy with the decision to exclude conventional petrol powertrains from the CT line-up, saying the company could achieve its volume targets with the hybrid-only range.

“The whole purpose of this car is to signal the future and I am very happy to have just hybrid,” he said, adding that the CT might account for up to 25 per cent of Lexus sales.

Mr Cramb said that all being well with supply of vehicles from Japan, Lexus Australia hoped to achieve 8000 sales this year, which would make 2011 the brand’s second best year after 2007, when it sold a company record 8199 vehicles.

A sales total of 8000 vehicles would represent a 25 per cent lift over 2010, when the brand sold 6526 units.

“It may not be a record year this year, but in the next couple of years we will break that as we charge forward,” he said.

With two months of 2010 gone, Lexus sales are down 8.9 per cent, with all models in the red compared with the same two months of 2010, when an aberration caused by business tax incentives in 2009 lifted deliveries into the start of the following year.

Rival Audi is up 15.3 per cent this year, while BMW is down 21.8 per cent and Mercedes-Benz down 18.4 per cent.

Mr Cramb said he was respectful of the German brands, but said he believed Lexus could still chase them down for market leadership.

“They are good strong competitors, but we turn 21 this year, and I look at us as coming of age,” he said. “We are a brand on the move and we have places to go.

“I would love to see the product line-up that’s coming down the line cause some real competition.”

Mr Cramb said Lexus Australia had no immediate plans to expand its dealer network on the arrival of the CT200h, effectively shelving the proposal of his predecessor, John Roca, to double the size of the Lexus dealer network, at least for now.

“We have 24 sites at the moment and there are no plans for that to change, certainly in the next couple of years,” he said.

“Once our volume goes over where we have previously been, we will start to look at that, but for the time being (there is) no plan.”

Mr Roca told GoAuto in 2009 that he hoped to expand the Lexus network to 48 sites, but said that expansion would be put on hold for two years – until 2011 – due to the GFC.

Mr Cramb said the first of 10 LFA supercars earmarked for Australian customers would roll off the production line in April, ready for delivery in May or June.

He said all local LFA customers had been invited to the Australian Formula One Grand Prix as guests of Lexus, where they saw the first production LFA in the country, a Lexus Australia marketing car that was used as a pace car for the CT200h celebrity race.

Only 500 of the 412kW V10 super-coupes will be produced for global consumption. Originally, Australia was to get an allocation of five vehicles, but managed to talk it up to 10.

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