Lexus goes off-shore

TOYOTA has announced that the Lexus RX300 sport-utility vehicle will go into production at its plant near Toronto, Canada, starting in late 2003.

This will be the first time any Lexus vehicle has been built outside Japan.

The move could also have long-term repercussions for Australia as Toyota Japan has been unable to produce enough RX300s to satisfy the US market.

By moving production to Canada, Toyota should be able to satisfy global demand, including Australia.

The RX300 is built on the same platform used for the V6-engined Toyota Camry and the Lexus ES300, but has a wagon body.

Like many new generation SUVs, it comes with four-wheel drive (as an option), but is not intended to do anything more serious than tow a boat trailer off a slippery ramp at the yacht club.

The RX300 is even more car-like than rivals like the Mercedes- Benz ML320, is packed with luxury features and has been a tremendous sales success in the US.

It is now the highest selling Lexus model in the US.

The RX300 has cashed in on America's obsession with SUVs, which now account for one in every five vehicles sold in the US.

Last year Lexus sold 73,500 RX300s in the US and a further 3100 in Canada, adding considerable volume for the marque.

Toyota built 115,000 Lexus RX300s last year at its Tahara plant in Japan The president of Toyota Motor North America, Mr Tag Taguchi, said moving production of the vehicle fitted in with the company's global production policy.

"It is Toyota's intent to build automobiles in the countries where we sell our vehicles in volume," he said.

"All of our North American plants have earned a reputation for excellence and there is no doubt the Cambridge (Canada) plant will produce the superior quality that Lexus consumers demand." Moving production to Canada will also avoid paying import duties, which The Wall Street Journal suggests could result in a $US5000 price reduction.

Production capacity at the Canadian plant will be increased by 20,000 units a year to 220,000 at a cost of $US442 million and production of the Solara coupe will be moved to Kentucky in the US to accommodate the RX300.

Industry analysts suggest that soon after production of the RX300 commences in Canada it will start building a Toyota-badged version called Highlander.

By 2003 Toyota will be producing 1.45 million vehicles a year in North America (an increase of 16 per cent over 1999) and employ 33,000 people.

The RX300 will bring to nine the number of models Toyota builds at four plants in North America.