Lexus: It's OK to not be the Most Popular.

By Larry Nutson
Senior Editor, Chicago Bureau
The Auto Channel

Chicago, July 2011; More often than not, significant attention is given in the media to being number one in the sales volume race, no matter what the consumer product. And that is especially true in the automotive sector.

Well, is it always a beneficial and good thing to be number one in sales? I haven’t known too many ladies who are excited about buying the most sold dress on the market to wear to an upcoming benefit fundraiser social. And when it comes to luxury, exclusive and aspirational brand automobiles this writer doesn’t see any benefit to selling the most. The objective is to sell to your business plan and keep your customers satisfied with their purchase. As soon as everyone in town has the same thing and they see themselves coming and going in every car on the road they will defect to another brand.

Lexus brand has been on a roll and for the last 11 years Lexus was the top luxury brand in the U.S. market, also its biggest global market. Mark Templin, Lexus Division general manager said Lexus U.S. sales will fall about 17 percent to around 190,000 vehicles in 2011 coming from lost sales resulting from production loss due to the Japan earthquake and tsunami,

All Lexus models, except the RX 350 crossover sport utility vehicle, are made in Japan. The Canadian-built RX 350 will be back at full capacity in September according to Templin. Most Japanese plants assembling Lexus models have already returned to full strength. Lexus dealers will be fully restocked by December.

"June was the trough of low volume, and we've turned the corner. The rest of the year will be much better for us," Templin said, speaking at a Lexus media round-table in Chicago. Templin wasn’t concerned with the significance of losing the luxury sales crown, and when asked if Lexus could reclaim the top spot in 2012, he said. "Whether we're No. 1 or not, I don't care. We've never focused on that. We won't change our plan midyear because someone else is selling more cars than us."

The Chicago visit was part of his "Evening With Lexus" tour. Templin would be meeting with customers in a suburban home and hosting a dinner prepared by a renowned chef. That evening’s meal was being prepared by Rick Tramonto, formerly of Chicago’s Tru. These informal dinner gatherings of 14 up to 22 customers have been ongoing in major markets such as Los Angeles, San Francisco, Dallas, Miami, Washington DC and New York

Lexus also has recently announced a Hotel Partner Program where, for example with The Elysian in Chicago, the automaker is providing a fleet of vehicles exclusively for the use of hotel guests. The Elysian provides a driver to transport guests to and from various Chicago shopping, dining and cultural venues in one of eight Lexus vehicles rather than guests using taxis.

Lexus’ affinity marketing has focused on affluent sports such as golf and tennis and also in epicurian affiliations. Lexus has enjoyed high customer loyalty coming from a mid-50s median buyer age. All-wheel-drive in its car models has been a great selling feature in the midwest and northeast markets, where it is exclusively ordered by dealers. The sportier IS sedan and CT premium compact hybrid are selling to younger owners.

With a hint to future product, Templin suggested that some Lexus models would be getting more sporty accents. Elements from the flagship LFA supercar and LF-Gh will trickle down. The CT 200h priced at around $30,000 bookends the low end of Lexus’ model line and intended to attract an environmentally conscious yet fun-to-drive seeking younger buyer.