By Marty Bernstein
AIADA Contributing Editor
In the 22 years since Toyota first established its Lexus brand, Mark Templin has spent time in each of the company’s operations areas. His role in establishing Lexus as a leading luxury brand in the U.S. and its dealers as the gold standard in quality and customer service was rewarded when he was named the brand’s Group Vice President and General Manager.
“I was one of those guys they hired from the outside for the start of the Lexus division and its early growth,” Templin said during a recent interview with AIADA. “I’m proud to be part of the team that worked so hard to make Lexus a reality. I do think that Lexus changed the automotive business in the United States.”
Lexus isn’t done changing the automotive business, though. According to Templin, the best days for Lexus lie ahead as it emerges stronger than ever with a slew of new products and, as always, an emphasis on its customer experience.
Defining Lexus and the Luxury Business
Templin argues that the term “luxury” is not confined to the vehicles Lexus sells. Rather, it hinges on the experience that customers experience in buying and owning the vehicle. “Luxury is more defined not so much by the car, but by the service you provide customers,” he said. “The element of providing exceptional customer experiences is the single most important factor in defining a luxury auto brand.”
To that end, Lexus and its dealers follow and embrace a philosophy contained in “The Lexus Covenant.” One of its tenets states that “Lexus will treat each customer as we would a guest in our home,” a tradition which Templin said the brand intends to continue. “The Lexus covenant is loud and proud today,” he remarked.
Lexus has faced its share of challenges in recent years, the most recent 2011’s Japanese earthquake and tsunami that resulted in a loss of 50,000 units for the brand. Despite the hurdles, Templin is bullish on the potential of Lexus and the luxury segment as a whole in the U.S.
“We believe the mass market will grow by another million units in 2012 and that about 100,000 units will come in the luxury category,” he said. “Every auto manufacturer sees the same research we do, which forecasts the luxury market will, over time, grow even faster than the mass market as the economy recovers.
The Future of Lexus and the Luxury Segment
Stringent fuel economy standards are driving many automakers to build smaller, less expensive vehicles in the coming years. Templin indicated that Lexus doesn’t plan to reduce the size of its vehicles. “We can sell true luxury cars and don’t intend to build any car smaller than the hot selling CT 200H.”
In December, Lexus launched the new GS sedan, which Templin described as, “The first car in a whole series of cars we will be launching over the next couple of years that show the new face of Lexus, and all future designs for Lexus product executions.”
The brand will launch 11 new or updated products this year, including a hybrid version of its GS that features a powerful engine and 30 percent better fuel economy. According to Templin, every model in Lexus’ future lineup will also offer a hybrid version.
Also on the Lexus menu: improved driving dynamics, better suspension systems, brakes, precision steering, and carbon fiber technology. The new features are derivatives of the Lexus LFA sports car. As a major attraction at auto shows, Templin said the LFA is “a wonderful halo for the brand and it’s been a great exercise in learning for our engineers.”
Thanks to Mark Templin’s leadership, there are clearly groundbreaking days ahead for Lexus. Stay tuned for more on what's in store for the brand in the coming years. For his remarks to dealers at AIADA's 42nd Annual Meeting and Luncheon, click here.