Now the challenge was to continue and complete testing, and to get the production and sales infrastructures into place. By August of 1988 overall planning was advancing well. Design and engineering parameters were so firmly established that Roger Penske, the renowned racing team owner, businessman and soon-to-be Lexus dealer - one of the first of a small and select group - traveled to Japan to test-drive the F1.

To qualify for a Lexus dealership, potential dealers had to have a successful track record of vehicle sales and leasing, the ability to build a world-class customer center to Lexus standards and most importantly, a history of completely satisfied customers. So stringent were Lexus' standards that just 81 out of the more than 1,600 dealers who applied were chosen. All chosen dealers signed the Lexus Covenant, and the first dealership, Lexus of Columbus, had its ground-breaking in August 1988.

All this before the car even had a name. In November 1988 the F1 was finally christened the LS 400 - the LS for luxury sedan and 400 because the car was powered by a 4.0-liter V8 engine. The LS 400 debuted with its stablemate the ES 250, an entry-level sedan based on Toyota Camry architecture, in prototype form at the North American International Auto Show in Detroit in January 1989. Full-scale production began at the Toyota Tahara plant in Japan in May 1989, with sales kicking off in September 1989.

"I think we all felt when we worked on this car it would have a dramatic impact," recollected Illingworth. "We could feel it. The first time I sat in the vehicle and listened to the sound system with the theme from '2001: A Space Odyssey' playing, I realized what a complete and outstanding car this was, from engine to audio to seats. It was a really special vehicle."

"We had the cars, we had the people and we had the philosophy," said Denny Clements, former Lexus vice president and general manager. "Now all we had to do was tackle the most competitive, prestigious automotive market in the world."

"The ES 250, introduced alongside the LS 400 as a companion piece, was an important piece of the overall Lexus prestige-market puzzle," stated Illingworth.

"You can't launch a new division with new buildings, new parts and no used cars, with just one model," said Illingworth. "We all felt we needed an entry-level model, and we couldn't launch another all-new car to fill this role, so the ES was that car. It was a version of the Vista, a Camry derivative, sold elsewhere, but with a different grille and different wheels."

Response from the car-buying public to both cars was very positive. In fact, the first month the LS 400 was on sale, more than 4,000 cars were sold. The Lexus brain trust knew it was on the right track, and began ramping up plans for additions to the line.

Even with the most careful planning and engineering, things can go wrong. In late 1989, Lexus received several customer complaints stating that the third brake light was not sufficiently bright, and its housing was distorting. Additionally, a customer complained of a problem with his car's cruise-control electronics. Lexus managers found the solution to the problem right in their own Lexus Covenant: "Do it right, from the start." They took the unprecedented step of recalling every one of the approximately 8,000 LS 400s already sold in order to check for problems and make any necessary repairs.

In a uniquely Lexus gesture, each LS 400 owner was sent a personalized apology letter via Federal Express. Then, setting new standards for personal service, each vehicle was picked up for repair, with a loaner vehicle provided free of charge, and then delivered back repaired if needed, washed, and with a full tank of gas. Technicians even made house calls, if necessary. To top things off, each LS 400 owner received a gift from their dealer in appreciation for their understanding.

previous page | go to page 4