March 29, 2024

Toyota Said to Plan to Make Lexus ES in Kentucky

DETROIT — The Toyota Motor Corporation is expected to announce on Friday that it will expand production at its plant in Kentucky, most likely adding a line for the Lexus sedan, which has not before been built in the United States.

Toyota’s president, Akio Toyoda, will make the announcement in New York, where he is also scheduled to attend a Lexus brand marketing event.

Mr. Toyoda is expected to detail a plan to build the Lexus ES sedan in Georgetown, Ky., according to a person with knowledge of the plan who was not permitted to comment publicly before the announcement. Kentucky has been competing for the expansion, and has offered Toyota $146.5 million in state and local tax incentives, The Louisville Courier-Journal reported this week.

The state’s governor, Steve Beshear, will also be making an announcement on Friday at the Georgetown plant with Toyota officials.

While Toyota currently does not build any Lexus models in the United States, it does make the brand’s RX sport utility vehicle at its Lexus plant in Ontario, Canada, which is also expanding to accommodate a hybrid version of the S.U.V.

The additions of new production lines underscore the stiff competition among leading automakers in the United States, where sales of luxury cars have been growing faster than other auto sales. In the United States, sales of Lexus models improved by 15.6 percent through March of this year.

The expansions reflect Toyota’s wide-scale efforts to overhaul its luxury products, including a redesign of its Lexus models to appeal to younger drivers and to try to lure customers away from top-selling luxury rivals BMW and Mercedes-Benz. Toyota had been the best-selling luxury brand in the United States for 11 consecutive years until 2011. But in recent months, Toyota unveiled new versions of Lexus models that feature bolder styling, better safety features and more powerful engines.

Building a Lexus model in America for the first time could help burnish the brand’s image.

The Lexus entry into production in Kentucky and the expansion in Canada are both expected to add jobs, and both are occurring with the help of government subsidies.

The Louisville Courier-Journal said the incentives would be offered in exchange for retention of at least 6,100 full-time jobs, and that possibly as many as 750 new jobs could be added. Of the 750 jobs, 180 would be variable and contract workers, the newspaper said in describing conditions set by the state’s finance authority. The remaining 570 positions were used to calculate the state’s $146.5 million incentive offer involving a total of 6,739 jobs, according to the report.

In Canada, Toyota said it would spend $125 million to expand its plant in Cambridge, Ontario. The investment, which includes government loans of $34 million, will increase Lexus production in Canada by 30,000 units, to 104,000 a year. About 400 new jobs will be created when the expansion is completed next January.

A top Lexus sales executive, Timothy Morrison, said at a media event in Detroit last year that the brand was not necessarily set on regaining the top spot among luxury cars.

“We don’t care who is No. 1 at the end of the year,” said Mr. Morrison. “Being No. 1 with the customer is what we need to focus on.”

Another Japanese automaker, Nissan, is planning to build its first Infiniti luxury model in the United States at a plant in Tennessee. In that case, the American plant beat out Nissan plants in Japan for the assignment.

Ian Austen contributed reporting from Ottawa.

Article source: http://www.nytimes.com/2013/04/19/business/toyota-said-to-plan-to-make-lexus-es-in-kentucky.html?partner=rss&emc=rss

Wheels: Ernst Lieb, Chief of Mercedes USA, Is Fired

Daimler, the parent of Mercedes-Benz, has dismissed Ernst Lieb, the president and chief executive of the luxury automaker’s American subsidiary.

Daimler announced the move on Monday. The statement, in an e-mail by Florian Martens, senior manager for corporate communications in Stuttgart, Germany, did not explain Mr. Lieb’s dismissal. Mr. Lieb, 56, had held the position since 2006.

Ernst Lieb.Ernst Lieb.

The company said Mr. Lieb was succeeded immediately by Herbert Werner, the chief financial officer of Mercedes-Benz USA, who was expected to hold the position “until further notice.”

Automotive News reported that Mercedes had canceled its national dealer meeting scheduled for Tuesday and Wednesday in Chicago.

Mr. Werner was appointed chief financial officer in February 2009. He previously directed power train operations for Daimler in Germany and served as a member of the board of management at AMG, Daimler’s high-performance subsidiary.

In the last year, Mercedes-Benz USA acquired the rights from the Penske Automotive Group to market and sell Smart cars in America; began outfitting its Alabama plant to produce the C-Class sedan; and secured exclusive naming rights for the Louisiana Superdome, which was renamed the Mercedes-Benz Superdome this month.

Mr. Lieb joined
Dieter Zetsche, the chairman of Daimler, in June to inaugurate the brand’s only company-owned showroom in the United States. It is a 330,000-square-foot space on 11th Avenue in Manhattan, built at a reported cost of $220 million.

Mercedes has strengthened its sales position in the last two years. It became the No. 2 luxury brand behind Toyota’s Lexus subsidiary in 2009 and maintained that position in 2010.

The company sold 21,649 Mercedes-brand passenger vehicles in the United States in September. Not accounting for sales of its Sprinter vans and Smart cars, it sold 170,058 Mercedes-brand vehicles through September, a 7 percent improvement over sales for the same period in 2010. Over all, Mercedes-Benz USA sales were 10.4 percent higher than in the first nine months of 2010.

The performance was roughly on a par with that of BMW, its primary rival. In September, BMW USA sold 21,750 BMW-brand vehicles — not accounting for sales from its Mini subsidiary — but sold more units than Mercedes through September, 177,679, a 12.8 percent increase over year-to-date performance from 2010.

Audi, meanwhile, continued to gain on its rivals. It sold nearly 10,000 vehicles in September, a 19.3 percent increase over September last year. Through September, Audi sold roughly 85,000 vehicles in the United States.

Article source: http://wheels.blogs.nytimes.com/2011/10/18/ernst-lieb-c-e-o-of-mercedes-benz-usa-is-dismissed/?partner=rss&emc=rss

Because of Japan’s Problems, Auto Dealers See Trouble Ahead in Meeting Demand

At this point, most dealers in the United States say they have enough inventory to meet their needs, even though many Japanese parts and auto plants have been closed since the March 11 earthquake and tsunami, cutting output by at least 400,000 vehicles.

“As it stands right now, you can still go to any dealership and get any model you want,” Ivan Drury, an analyst with Edmunds.com, which provides car-buying information to consumers, said on Wednesday.

Still, the question for dealers is what happens next.

Robert Shrader, the general manager of Jim Coleman Infiniti in Bethesda, Md., said: “Every day things change, but we anticipate there is going to be some disruption.”

Infiniti, Nissan’s luxury brand, gets its full lineup from Japanese plants. The tsunami destroyed around 1,300 Infiniti vehicles that were awaiting shipment from a Japanese port to the East Coast

“What we have right now will probably hold us over for about 60 to 90 days,” said Mr. Shrader, who is still receiving regular deliveries. “The concern would be the summer.”

In March, new-vehicle sales increased at least 15 percent, according to several analysts’ forecasts; automakers are scheduled to report their results on Friday.

Mr. Drury said gasoline prices, which were rising quickly before the earthquake but have largely leveled off since, pushed many consumers last month toward smaller, fuel-efficient vehicles, many of which are imported from Japan, including its Prius hybrid.

While Toyota restarted production of the Prius and other hybrids in Japan on a limited basis this week, most of its plants remain closed or are making only parts. The plant that makes the Toyota Yaris, a subcompact sold in the United States, is expected to be down at least until late April, the trade publication Automotive News reported.

As a result, Toyota has told dealers in North America to stop ordering 233 different parts — out of a possible 300,000 — unless they are needed for a specific customer’s vehicle.

Honda and Subaru have begun slowing their North American assembly lines because they are running low on Japanese-made parts. The Ford Motor Company and the Chrysler Group are building fewer vehicles in some paint colors because a Japanese-made pigment is expected to be unavailable for another month or more.

Nissan said on Wednesday that it expected to resume normal operations at all but one of its Japanese plants by mid-April. The sole exception makes V-6 engines for several other plants and is expected to be fully repaired by the end of April, Nissan said in a statement.

Company executives are expected to decide in the next few days whether to begin shipping engines to Japan from a plant in Tennessee to make up for disruptions there. While Nissan has resumed building many vehicles in Japan, it said that it planned to shut its plants again all of next week.

The research firm IHS Automotive said that 13 percent of global automotive production was down last week and predicted that up to a third of the industry’s production capacity could ultimately be affected by the disaster.

Paul Newton, an IHS analyst, said in a report issued on Wednesday that automakers worldwide are in “a highly fluid and opaque situation, which will likely worsen significantly before improving.”

Many vehicles built in the United States and other countries use at least some Japanese parts, or else their parts makers rely on some chemicals or other products from Japan.

Shoppers could soon start seeing fewer Ford vehicles in “tuxedo black” and three shades of red, and Chrysler is restricting orders in 10 different colors made with the metallic pigment Xirallic from the German chemical company Merck. The shortage affects five of the eight colors in which the Chrysler 300 is sold and four of the seven colors for the Dodge Charger and Challenger, for instance.

Honda, which had already told its North American dealers that it would delay taking May orders for Japanese-made vehicles until it had more definitive information about availability, on Wednesday began shortening shifts at plants in the United States and Canada.

A Honda spokesman, Edward K. Miller, said the plants would remain open but operate for fewer hours each day so that parts supplies would last longer.

“The overwhelming majority of parts come from the U.S., but we are dependent on some Japanese parts,” Mr. Miller said. “It’s a global business and more efficient that way, but the magnitude of what happened in Japan was unforeseen.”

Article source: http://feeds.nytimes.com/click.phdo?i=38a7b017d9b7c6721c58b77542bb72e2