Toyota In No Hurry to Build Lexus Cars in China

“In China, it’s no secret that if you don’t start building cars you’re not going to do the big, big volumes,” Mark Templin, executive vice president of Lexus International, told The Wall Street Journal Friday, adding that it’s also a company goal to make cars where they are sold. Even so, he said, it will be some time before Toyota builds Lexus cars in China.

“We’re not having those discussions about when we’re going to go to China,” he said. “We have a lot of work to do before we get to that point.”

Moving slower than rivals, though, risks falling too far behind in market penetration to make a significant impression. And if Lexus ends up the only major luxury marque that imports all of the vehicles it sells in China, it would be at an immediate price disadvantage, given China’s high tariffs.

Nissan Motor Co. plans to start manufacturing two Infiniti models in China next year, and Honda Motor Co. said last month it will start making its Acura-brand cars locally within three years. Lexus’s German rivals—BMW AG, Daimler AG’s Mercedes-Benz and Volkswagen AG’s Audi—have been building cars in China for years.

But over its 24-year history, Lexus has been conservative about expanding production abroad, concerned about whether factories outside Japan can meet its stringent quality standards. Toyota only recently announced that it will begin building Lexus ES sedans in Kentucky, marking the first time its luxury-brand vehicle will be built in the U.S., its biggest market.

Lexus sales in China have yet to reach a level that calls for a local assembly line, Mr. Templin said.