Lexus had managed to exceed customers' expectations. And as a result, instead of being chastised for what could have been perceived as a flaw in initial quality, Lexus was praised for the way it handled the problem. The company's honesty and forthrightness were seen as a sign of strength and commitment, not weakness.

After coming through this potentially image-destroying service campaign with flying colors, Lexus sales soared. In fact, Lexus finished out 1991 - the same year that the new SC 300 and SC 400 sport coupes went on sale - as the top-selling import luxury brand. The company, with its all-new car, had done what some had thought was impossible. It had proven that the Lexus formula of superior products and outstanding customer care was a winning combination against the European and American prestige brands. Customers responded appreciatively.

The company wasn't about to rest on its laurels, however, or to believe its own press clippings. As other manufacturers scrambled to match Lexus in both product excellence and customer treatment, Lexus executives launched the industry's first comprehensive certification program to specially train each and every Lexus sales associate to fully understand the company's mission to exceed customer expectations. The "Lexus touch" had to be more than just a slogan. It had to be a way of life.

As that way of life became reality, Lexus built a tradition of quality in its first years. In 1991, the brand was named number one in two J.D. Power and Associates' surveys - for initial quality and a sales-satisfaction. "That meant we'd achieved our goal of giving customer service," said Illingworth.

Then, in the early 1990s, soon after a freshened Lexus LS 400 bearing more than 50 changes and upgrades debuted, there was more trouble - this time, trouble over which the company, its executives, stylists and engineers had absolutely no control.

"The economy weakened, our competitors responded with improved products and the yen-dollar exchange rate hurt our pricing," recalled Clements. "There was even the threat of a luxury trade tariff that would have priced Lexus vehicles right out of the market."

"In the early '90s there were a lot of problems with the yen-to-dollar ratio, and there was a lot of anti-Japanese feeling," remembered Illingworth. "Those were difficult and uncomfortable times."

"We could have easily cut corners to be more competitive or waited patiently until the economy improved," said Clements of Lexus' soul searching. "But that wasn't Lexus-like, it wasn't putting forth our best possible efforts for our customers. We went back to the drawing board and came up with a new group of products designed to show the spirited side of Lexus."

The spirited side of Lexus meant, in this case, the introduction of the luxury-performance GS 300 in 1993. This introduction marked the beginning of a drumbeat of new vehicles. First, in 1994, an all-new, second-generation LS 400; then in 1996 the LX 450 sport utility vehicle (SUV) complete with its direct Land Cruiser heritage; and, in that same year, an all-new ES 300.

Of equal importance were the introductions of the all-new GS 300 and 400 high-performance sports sedans in 1997 and the mid-size SUV, the RX 300 in 1998. The RX created an entirely new segment, called within the industry as the "crossover" segment, and established a new industry benchmark.

"SUVs just seemed to be a natural evolution of the marketplace, " said Illingworth of the marque's march into a new segment. "The SUV line evolved because of customer demand for a larger vehicle of that nature in that category."

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