Lexus, Toyota’s luxury brand, appears unscathed by recalls

Published 4:00 am Friday, March 12, 2010

It has been a rough few months for Toyota because of its three big safety recalls. But the automaker’s luxury division, Lexus, appears to have avoided much of the fallout.

Even though a Lexus ES 350 was involved in a widely publicized accident before the recalls, Lexus sales are up about 5 percent so far in 2010 compared with last year. That is close to the average for other luxury brands.

By contrast, sales of models with the Toyota nameplate fell 15 percent.

The number of Lexus owners shopping for a new Lexus increased from December to February, while the number of Toyota owners planning to stay with the brand declined, according to Kelley Blue Book, which tracks vehicle sales and values. Lexus residual values have held steady as Toyota’s have fallen slightly.

Analysts said that sales of Lexus have held up partly because the brand is not included in the most serious recall for sticking accelerator pedals.

Not one of the eight models that Toyota temporarily stopped selling and building was a Lexus.

Only about 500,000 Lexus cars have been recalled, compared with 8 million Toyota-brand models.

“Toyota is of course the headliner,” said Stephanie Brinley, an analyst with the consulting firm AutoPacific. “While it seems like everybody already knows that Toyota and Lexus are related, that may not be the case. The Lexus name has not been as criticized.”

Separating Lexus from Toyota has been the company’s goal since it started selling Lexus cars in 1989. Toyota officials focused on creating a luxury marque, aimed primarily at Americans, to compete with BMW and Mercedes.

Yet on a per-vehicle basis, Lexus is responsible for more reports of unintended acceleration than the rest of Toyota, federal records show. And more than half of the roughly 300 such complaints to regulators since 2000 about Lexus ES and IS series models — the only two models subject to recall — involve vehicles from years that have not been recalled.

Complaints link the ES series to at least 61 injuries, more than any Toyota model except the Camry sedan. Because Toyota sells about seven Camrys for every one Lexus ES, the ES is linked to more injuries per vehicle.

In August, a 2009 ES, since recalled, sped off a highway near San Diego and crashed into a ravine, killing the off-duty California Highway Patrol officer who was driving and three family members, one of whom called 911.

The National Highway Traffic Safety Administration recently bought and is conducting tests on a Lexus sedan that took its original owner on an unintended six-mile ride. That driver, Rhonda Smith of Tennessee, eventually brought the car to a stop and was not injured; her testimony opened a series of hearings in Congress beginning last month.

The home page of Toyota’s Web site includes a bright red “Recall Information” message, but the notices are more subtle on Lexus.com.

“There are very few Lexus models that have been affected by this,” said John Hanson, a Toyota spokesman. “We are very distinctly different brands and we have different business models. The way they do business is deliberately very different.”

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