The incredible Lexus LS 400 inflicted permanent damage on every luxury brand. But ironically, Lexus itself was an unintended side-effect of a U.S. government attempt to protect Detroit — a plan that backfired spectacularly. This is that story.
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The LS400 changed the automotive world — creating a world-beating brand, inflicting an existential crisis on Mercedes, and mortally wounding the Detroit automakers. But Toyota didn't simply choose to create the best sedan in the world — it happened when the Japanese automakers were backed into a corner when the U.S. government coerced them into "voluntarily" limiting the number of cars they could import.
"Voluntarily," that is, if you ignore the threats of tariffs and penalties.
Those tariffs would erode Toyota's value equation, and the import cap would squash its growth. So it had no choice but to sell more expensive, more profitable cars in America. And its target: the luxury market.
BMW and Mercedes didn't see it coming. The Germans laughed at the idea of a luxury Toyota, thinking the brand didn't have the history and heritage to attract customers — blissfully unaware that many luxury-car buyers wouldn't buy a German car precisely because of that country's (relatively recent) history.
Sold in some markets as the Toyota Celsior, the Lexus LS 400 forced Mercedes to rethink its entire business model, as it was a better car than the contemporary S-Class, for half the money. Toyota gave the Project, known as F1 (and Circle-F) an unlimited budget and many times the engineers to ensure that it was the best luxury car in the world.
The details are insane — if the devil is in the details, the LS400 must have been hell to produce. Its chief engineer accepted no compromises in his vision and the application process to become a Lexus dealer was incredibly difficult. But it was, obviously, worth it, creating a brand to this day has possibly the most loyal customers of all.
This documentary by veteran multiple award-winning automotive journalist Jason Cammisa provides a deep-dive into one of the biggest automotive success stories of the last four decades.
This episode of Revelations is presented by Mobil 1.
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