The chief engineer for the LS400, Ichiro Suzuki, was pushing to build a “stretch” LS400 with added backseat legroom. The car was not intended to be chauffeur-driven like the Toyota Century in Japan. The market for the car in the U.S. was small, but it would increase sales slightly and add prestige to the Lexus brand.
Bob McCurry and I were standing in the Design Dome looking at the clay model of the “stretch” LS400 when he turned to look at the new Toyota Land Cruiser. Because of its excellent reliability, the Land Cruiser was hugely popular around the world. It was Toyota’s longest-running production model, dating back to 1951. The Land Cruiser was very expensive; Toyota only sold a few thousand a year in the U.S.
“You need to convert the Land Cruiser to a Lexus and sell it as a luxury SUV,” McCurry said. “The SUV market is where all the growth is going to be in the future.” I was disbelieving, “Really—a truck in a luxury car franchise?”
The SUV market in the U.S. at that time consisted of Jeep Wagoneer, Chevy Blazer, Dodge Ram Charger, Ford Bronco and Explorer, and the Toyota 4 Runner and Land Cruiser. No luxury car franchise would lower itself to the truck market. But McCurry insisted and the chief engineer of the Land Cruiser was very excited about the idea of a Lexus Land Cruiser. The LS400 “stretch” would never be built, but the Lexus LX450 would.
Externally, the Lexus LX450 would be identical to the Land Cruiser except for the grille. Most of the differences were on the inside, with restyled and more luxurious interior leather seats and a softer suspension. It wouldn’t go on sale until after I left the division in 1995. The LX450 sold quite well but was irritating to the Toyota dealers because the public preferred the Lexus badge for more prestige, and Land Cruiser sales dropped as a result.
After the LX450, Lexus would add the RX and GX as the SUV market exploded. McCurry was right again and soon all the luxury brands had SUVs, including Porsche.
“Commit your plans to the Lord, and your plans will succeed.” Proverbs 16:3 (NLT) When we rely on God to direct our paths, He will lead us in the right direction. To learn more about His plans for His people, read the God of Hope book!
The first 18 months of the Lexus launch had been a triumph. That was just fine and dandy. What about the next 18 months?
(To be continued in “The Second Lexus National Dealer Meeting”)