Since its introduction in 1989, Lexus has created a niche in the world of lifestyle luxury vehicles, specifically as a leading manufacturer of self-charging hybrid electric vehicles. The company started Indian operations in 2017 and its product portfolio is priced between ₹56.71 lakh and ₹2.33 crore (ex-showroom). P.B. Venugopal , president, Lexus India says the brand has seen better response in India than anticipated. Excerpts:
It was the product that had launched the Lexus brand. What is the Lexus story?
In 1983, Toyota chairman Eiji Toyoda felt that the time was right for Toyota to produce a luxury automobile. He decided that this new vehicle would be the finest luxury car in the world, offering speed, safety, comfort, elegance, dignity and beauty.
This automobile also had to be accompanied by high levels of customer service that exceeded the expectations of luxury car buyers.
The first Lexus, the LS 400, was introduced in 1989, setting a new standard. Lexus then introduced the ES, SC, GS and IS. In following years, the LX, GX and RX luxury utility vehicles were introduced.
Lexus launched the world’s first luxury hybrid, the RX 400h, and has since expanded its line of hybrids to include the GS, LS, ES and CT models. Recently, it became become a dominating force in the performance category. Lexus has three plants in Japan and each Lexus is crafted by the best hands with a lot of passion.
The company entered India in 2017. How has the journey been so far?
We are just two years old. We can clearly see that whatever is happening is beyond what we anticipated. That gives us good confidence on the growth for Lexus in India. We take the pride in saying that we are the first Japanese luxury car brand in India.
The vision for Lexus in India is to be one of the leading luxury lifestyle brands by offering good quality services to our guests. Our mission is first to establish our brand and provide quality sales and services to our guests,
We have established guest experience centres in Delhi, Mumbai and Bengaluru. These are supported by authorised service centres. In addition to that, we have authorised service corners in Kochi, Hyderabad, Chennai and Chandigarh.
We have Lexus relationship managers and Lexus care managers who are single point of contact for our guests because they are HNIs (high-networth individuals) and want hassle-free experience. They would always look at one point from where they can get complete solutions.
We have brought the complete hybrid range of vehicles because we need to contribute to the society. India has quite a few polluted cities and we believe hybrid is a good solution.
For every vehicle that is delivered, we plant certain number of trees, hence making Lexus owners carbon- neutral. Most of our customers are environment conscious.
What is the long term vision of Lexus in India?
Our vision is to establish Lexus as a luxury lifestyle brand in India.
Currently the luxury car market is around 40,000 units which is actually 1.2% of the total passenger car market. But in developed countries, it is close to 4 to 5%. India is seen in the medium and long-term view as the fastest-growing economy.
There will be huge growth of HNIs. We clearly see from the mid to long-term perspective that there is a huge potential for the luxury car market. We strongly believe that our self-charging hybrid vehicles are the right solutions for the current scenario.
Once the infrastructure develops for the electrification, hybrid can be a first step before the movement towards electrification.
What is the volume you are doing in India?
Volume is one way of evaluating the success. Another way is how our customers have been taken care of. Lexus strongly focuses on every customer and how they are being taken care. We believe in building lifetime relationships with our guests. Customers just do not want delivery experience but the complete ownership experience. In that sense we are doing better than anticipated.
When we came, there were two hypothesis. One was that we would get customers from the Toyota family. Since there was no other option from us, they were and going for other luxury brands. We thought there was a good opportunity for them to be within our family. So, one of the hypothesis was at least 70 to 80% of the Toyota customers should actually be looking at Lexus.
The second hypothesis is customers tend to buy a self-charging hybrid electric vehicle.
So, currently 78% of the customers who are buying a Lexus are from the Toyota stable.
Who are the rest?
They are other HNIs who bought other luxury car brands. They are looking at Lexus as it is not just a vehicle but a lot of emotion goes into building it. Each customer is a connoisseur of art, who are able to see that this car is more about experience. They love the crafted craftsmanship inside the car. Our customers are looking at experience which money can not buy.
How are you building the brand in India?
The key differentiator is that a majority of our products are self-charging hybrid electric vehicles. We are also promoting our brand by making our customers carbon-neutral. They are experiencing the spirit of Omotenasi which is Japanese hospitality and they are also experiencing the cost of ownership. We strongly believe that as a corporate, we need to have social responsibility and on this front, we have been organising Lexus Design Awards. This award promotes aspiring designers from any field. The recent winner had designed a remote controlled equipment that can clean sewage without causing harm to human lives.
What is Lexus doing to develop full electric cars?
For India, we strongly believe that before the infrastructure is ready for electrification, we are in the right direction as self-charging, hybrid electric vehicles will be the first step before moving towards full electric vehicles.
(The writer visited Toyota Motor Kyushu Miyata plant in Fukuoka, Japan, where Lexus vehicles are produced, at the invitation of the company)
