Lexus, Acura, Infiniti search for halos in assault on Germans

By Hans Greimel, Crain News Service

DETROIT (Jan. 26, 2016) — The LC 500 is a stunning coupe meant to shatter Lexus' stodgy image. The Acura Precision Concept is a hot sport sedan symbolizing the brand's refocus on performance. The Infiniti Q60 two-door gets a 400-hp twin-turbo to sit atop the range as a muscular "brand shaper."

There's a new luxury plan from Japan, and its loud message is emotion and power.

Lexus, Acura and Infiniti aim to redefine themselves with cars rolled out at the Detroit auto show. Even as customers flock to crossovers and SUVs, the Japanese luxury brands plan to use record U.S. sales to combat their traditional weakness: cars.

Lexus' U.S. sales of 344,601 vehicles beat Mercedes-Benz for No. 2 in the U.S. luxury race last year, and were just 1,422 behind No. 1 BMW. The renewed focus on cars is a warning to the German luxury brands that their Japanese rivals are upping their games.

"Sedans tend to define the brand," said John Mendel, executive vice president of American Honda, whose Acura brand has struggled in the segment. "We've not been able to crack the luxury sedan halo vehicle. What you see with the concept is a strong shot across the bow."

Toyota Motor Corp. President Akio Toyoda learned Lexus' limitations the hard way.

When he unveiled the GS sedan at the Pebble Beach Concours d'Elegance in 2011, he was broadsided by savagely candid feedback about how the public viewed his cherished luxury brand.

Lexus cars were "boring," Mr. Toyoda recalled being told. "I really took them to heart. I was determined to make sure we became a more emotional brand and that the words 'boring' and 'Lexus' never showed up in the same sentence again."

Within months, Lexus acted on that pledge by delivering the svelte and sexy LF-LC coupe concept at the 2012 Detroit auto show. Four years later, Toyoda traveled to Detroit to unveil the production version -- remarkably unchanged from the concept, down to the futuristic jet-afterburner taillights and supersleek silhouette.

Proclaimed a proud Toyoda: "This is a new, brave Lexus."

The Japanese luxury brands have benefited from the U.S. light-truck boom. All three sell more crossovers and SUVs than cars. That contrasts starkly with BMW, Mercedes and Audi, whose sales skew heavily toward cars.

But now it's time for the Japanese to beef up those cars.

"They had trouble dialing in a performance and styling mix that would appeal to the luxury sedan audience," said Karl Brauer, senior director for automotive insights at Kelley Blue Book. "To be taken serious as a luxury brand, they need a solid sedan lineup."

Acura's makeover begins with the Precision Concept, which injects emotion and distances the brand from its mass-market Honda sibling. The concept "literally will shape the direction of all future Acura products," said Dave Marek, Acura's global creative director.

For starters, it is bye-bye "beak" to the much-maligned shield emblazoned on the front of Acura vehicles in recent years, with a point akin to the egg tooth baby birds use to break out of their shells. Instead, the Precision Concept gets a stylish pentagon-shaped grille Acura calls the "diamond pentagon."

Expect the grille to start gracing new Acuras, and even updates, as early as this year, perhaps beginning with a compact crossover to debut in April at the Beijing auto show and a midcycle freshening of the larger MDX crossover.

Honda Motor Co. was the first to gamble on a luxury marque when it launched Acura in 1986. Thirty years later, it's no coincidence the new design language debuts in a sedan.

Acura's two trucks account for nearly two-thirds of total volume; the rest is spread among three sedans. The hot-selling TLX sedan accounts for nearly 70 percent of the car total. Sales of the flagship RLX sedan slumped 36 percent to just 2,195 last year.

"We want to hit the sedans and say this is going to be our next really big push," Marek said. "Sedans are everybody's core. Let's get those good."

'Brand shaper'

Nissan Motor Co. Ltd. CEO Carlos Ghosn concedes that 26-year-old Infiniti is still trying to cover the basics of the luxury business and working to build its image.

A halo vehicle could help, and the company showed the Q80 Inspiration concept as a vision for one at the 2014 Paris auto show. But this month in Detroit, Ghosn said it was premature to talk about a production version of a high-flying flagship.

As a placeholder, Infiniti unveiled the Q60 coupe, with an optional 3.0-liter twin-turbo V-6 delivering up to 400 hp. "It's definitely a brand shaper," Infiniti President Roland Krueger said. Its emphasis on sporty design, powerful engines, electronic suspension control and technology tailoring the car to individual driving styles are all signs of things to come.

Ghosn said the Q60, which goes on sale by midyear, will push Infiniti past its 2015 global sales record of 215,250 vehicles. Still, Infiniti is a long way from Ghosn's goal of taking 10 percent of the global luxury market. Infiniti has just more than 2.5 percent, reckons Krueger.

In the U.S., Infiniti's sales climbed 14 percent to 133,498 vehicles last year, just shy of the record 136,401 it sold in 2005.

Acura is coming off its fourth straight year of U.S. sales growth. Sales rose 5.6 percent to 177,165, and Mendel expects Acura's U.S. volume to gain another 5 to 10 percent this year. Acura's peak also was 2005, with 209,610.

Lexus booked its U.S. high last year. It capped a fourth consecutive year of growth with an 11 percent jump to 344,601.

Even with sexier cars, attempts to boost brand image don't grab hold overnight.

"It takes a long time for consumers to even notice it," said Stephanie Brinley, senior analyst at IHS Automotive. "One product, followed by another, is not enough. You have to apply it consistently across the entire lineup."

'Halo cars'

Still, Lexus has high ambitions for the LC 500, a low-slung, rear-wheel-drive coupe with a 5.0-liter, V-8 engine that will crank out 467 hp. Pricing will start at nearly $100,000.

Mark Templin, executive vice president of Lexus International, expects the car to go up against Aston Martin, Porsche and Maserati, leapfrogging Germany's Big 3 altogether.

Lexus aims to sell 6,600 of the Japan-made LC 500s a year globally, with nearly three-quarters of the volume coming from the U.S. To keep the car fresh, Lexus expects to introduce variants. The car's new modular platform, which will underpin all future rwd cars at Lexus, is even engineered to support a convertible, engineers said, though executives have not confirmed any plans for a droptop.

"We've redone all the SUVs. The next step is more emotional halo cars," Mr. Templin said. "What you see there is the next chapter in that move toward a more emotional brand."