China Imported 16,885 Lexus Vehicles in Jan-Aug, Up 160 Percent

SHANGHAI - November 2, 2007:

Lexus sold 16,885 vehicles in the first eight months this year in China, outselling every other brand in the imported luxury car segment.

A senior official from Guangzhou Honda said earlier the company had no plan to locally produce Lexus in China until its sales volume hits 50,000 units.

Zeng Lintang, deputy general manager of Honda Motor of China, said "an inadequate auto parts supply system is the most critical factor that hampers Lexus local production plan in China."

However, other company sources say the company has other reasons to pause its local production plan in China.

First, Lexus is extremely profitable if it is sold in completely built unit in China. For example, Lexus LS600hL is now sold $104,000 (786,000 yuan) in the USA, but $210,263 (1,598,000 yuan) in China. Other Lexus models are sold at even higher prices.

Secondly, quality control is more important than cutting costs. Toyota has quality concerns if Lexus is going to be made locally in China

Separately, Benz China said the company sold 15,900 units vehicles-- both locally made and the imported cars in the first eight months of the year.

Benz, BMW and Audi, three leading German premium brands have sold 25,983 imported vehicles in Chinese market.

Another premium German brand, Porsche has sold 2,345 units in the first eight months, outnumbering the sales of the whole last year. Porsche is expected to sell 4,000 units this year, analysts say.

For more information about the burgeoning auto industry in China please visit http://www.gasgoo.com/Autobiz/list/7/China-News.html