Toyota undecided about China production of Lexus

Shanghai, June 20 (Gasgoo.com) Toyota begs the question of the local production of Lexus by saying that it will consider locally producing Lexus in China only if the model could sell 30,000 to 40,000 units annually, though a single Lexus model couldn’t reach such big annual sales, reports China Automotive News citing Zeng Lintang, vice general manager of Toyota Motor (China) Investment Co., Ltd.

The report said there may be several reasons for Toyota’s hesitation about China production of Lexus. It favors the rich profit brought by imported cars as Lexus in the Chinese market is priced higher than that in other foreign markets. In addition, the prospect of Lexus in China’s auto market remains unclear. The low-end Lexus is hard to rival the upcoming low-end Mercedes-Benz and BMW vehicles in China, though Lexus hit sales record in North America. Once produced in China, Lexus will compete with Mercedes-Benz and BMW, which have a relatively low-priced similar model segment.

Besides, quality problems concerning the Lexus brand have arisen in China market as well. In recent years Lexus models were recalled frequently in China. Until the quality problems are solved, China production of Lexus will be still far away.