Lexus targets younger crowd

Lexus Australia is pushing ahead with its plans to introduce an entry-level model to compete against the BMW 1 Series, Mercedes-Benz A-Class and impending Audi A1. Lexus Australia chief executive John Roca told the Carsales Network recently that getting a new model to sit underneath the IS 250 is his main goal.

"Any entry-level car would be great," Roca said.

Given that Lexus is only competing in six segments of the luxury market, there is plenty of room for growth for the brand. Asked which holes he'd like to fill first, Roca was adamant the so called "baby Lexus" is an important element to his future plans.

"I think there is a huge potential for us to have an entry level car below the IS 250," he said. "There is a great opportunity between IS 250 and GS where the ES was. I'd be happy if I got those two to be honest.

"I think there is a huge market for a $49,990 or $45,000 Lexus," he added. "Given that if you do the research on young or early adopters to the luxury market it seems from a brand understanding and brand opportunity for us, a lot of younger people know more about Lexus than older people do. Because they [older consumers] are more staid, in terms of traditional European brands, whereas our younger audience is very open to the Lexus brand."

Work is already underway on the baby Lexus in Japan but so far details are sketchy, with Roca admitting even he is being kept in the dark. But he believes the car will be in showrooms by 2012.

"There is already talk of a baby Lexus, yet to be confirmed," he said. "But within the next three years.

"[Lexus] has been very, very vague about it. We'd like to know more about it. At this stage they won't confirm that the project exists.

"We'll know more in the next six to 12 months."

With more of Lexus' luxury rivals tapping into that market, Roca knows it is crucial for the Japanese company to get involved as soon as possible. Roca revealed that a decision was taken globally to focus on a small passenger model over calls for a smaller SUV to sit underneath the RX range.

"My priority is the entry level model because that would attract new buyers to the brand," Roca said. "Buyers that are sitting there more educated about the Lexus brand than any other consumer just saying 'one day', so it's becoming more aspirational. But you've got to have the product there. One thing we do know is once they jump into a [BMW] 1 Series it makes them more difficult to get them out."

Asked how parent company, Toyota Motor Corporation (TMC), sees such a car fitting within the Toyota line-up, Roca admitted the organisation was devoting more effort to the project.

"It's a question TMC has struggled with for many years but I think they are over that now," he said. "They can see the value in two brands to do it successfully regardless; because they are two different buyers. But why not attract them to Toyota and then hand them over to Lexus, which is the whole idea; a lifetime of reliable, well priced, well built cars."

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