Detroit Auto Show at 25

To be global, Detroit tapped Toyota, Nissan

Jim Perkins, a senior vice president at Toyota, introduced the Lexus LS 400 at the 1989 North American International Auto Show.
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The debuts of two Japanese luxury car brands -- Lexus and Infiniti -- at Detroit's first "international" auto show in 1989 succeeded in igniting interest, curiosity and buzz about the ventures.

But unknown to consumers, analysts and media who visited Cobo Hall that January was how gargantuan the brand launches really were -- and how much last-minute hand-wringing went on.

Dealers were still being recruited and vetted -- and in some cases, still trying to understand what the new franchises were proposing. There were unresolved naming issues and market research questions. The U.S. project teams for both companies were still working out of temporary digs as they felt their way through the startups.

But all that was behind the scenes.

Detroit's dealers who control the annual event wanted to push the show's recognition factor beyond their local Buick and Chrysler customers. Renaming the show an "international" event required Detroit's automakers and dealers to grudgingly cede front-page attention to their ever-stronger Japanese competitors.

The timing couldn't have been luckier. During 1988, it became known that Toyota and Nissan intended to move in a gutsy upscale direction. The Detroit auto dealers wanted to lay claim to the introduction of those brands.

"These dealers were going to invest $3 million to $5 million," said Chitty, now retired and living in Florida. "We didn't want people who were motivated simply because it was a good-looking car. We wanted people who believed in the concept of the franchise."

Lexus vs. Lexis


Although Lexus and Infiniti made bold statements with their North American International Auto Show launches, the automakers still had miles to go before the first cars were sold.

For instance, the new Japanese luxury brands still were signing up their retail networks -- a bit of a logistical hurdle for an auto show run by local dealers.

Retailers who wanted a Lexus store had to apply as though it were for a job. Candidates intentionally were not given full details on how the franchises would work. They couldn't even see a photo of a Lexus car, said Dick Chitty, who was Lexus' first manager for service, parts, training and customer satisfaction.

"These dealers were going to invest $3 million to $5 million," said Chitty, now retired and living in Florida. "We didn't want people who were motivated simply because it was a good-looking car. We wanted people who believed in the concept of the franchise."

Then there was the matter of the auto show display itself.

A West Coast brand-naming consultancy helped come up with the name "Lexor" for the sales channel. That morphed into "Lexus" as the official name.

But as Toyota's event marketing company, George P. Johnson, began to set up the Cobo Hall display, there was a snag.

Information services company Mead Corp. owned the trademark "Lexis" for its legal database. Mead, arguing consumers might be confused by the similarity, won an injunction that blocked Toyota from using Lexus as a trademark.

Just days before the show, Lexus and Johnson executives erased all traces of the Lexus name from the show stand. A separate display had to be created.

"We worked round the clock," Chitty said. "The signage had to be taken back down. Brochures couldn't be handed out with the name in them. The name on the cars had to be covered. Even the engine had to be covered over because the word 'Lexus' appeared there, too."

Then, the weekend before the show curtain rose, a U.S. court of appeals overturned the injunction and allowed Toyota to use the Lexus name without penalty. The original branding went back up.

"It came at absolutely the last minute," Chitty said. "It was a big moment for us. That name issue could have folded the Lexus Division."

Don't show the car?


Meanwhile, Nissan's fledgling Infiniti Division was uncertain what nameplates to put on the cars -- or whether to show a car at all.

"We were still testing the name in focus groups," said Deborah Thayer, media manager of the future Infiniti flagship, the Q45 sedan. Internally, it was called the "759."

"We weren't convinced that Q45 was the right name. We weren't sure how consumers felt about the letter 'Q' -- would they associate it with the word 'quirky' or maybe 'queer'?"

Thayer's colleague at the time, Peter Harris, looks back in wonder that Infiniti allowed the public to glimpse a car at all.

"Our plan was to keep the focus off of the car at first," said Harris, who was Infiniti's first manager of marketing plans. "We didn't want to show the car. And in fact, we didn't even show cars in our advertising until well after the sales launch. So it's hard to believe we would show them to the world in January."

Infiniti also challenged auto show tradition by not naming a sales target.

Bill Bruce, Infiniti's first general manager, who died last May, told journalists that the brand had decided to launch in the United States without a sales bogey because Infiniti wanted to focus on the "total ownership experience."

Bruce believed that a no-pressure, customer-first approach would give Infiniti the edge over the established luxury titans, Mercedes-Benz, Lincoln and Cadillac.

More than a few people walked away from Infiniti's Detroit show presentation surprised and perplexed. Among them were the local dealers -- who hadn't been told the specifics of Bruce's vision beforehand.

In conjunction with the show, industry forecaster AutoPacific warned of a bleak outlook for European luxury brands as Lexus and Infiniti took the stage. The forecast predicted that while the luxury segment would have a new period of rapid growth, all of that growth would go to the Japanese.

But it has been no cakewalk. The next 25 years were a whirlwind of the unexpected. Lexus and Infiniti had their share of product hits and misses. And Lexus -- more than Infiniti -- emerged as the brand that provided premium showroom handling and service relations.

No one was ready to cede the luxury market. Cadillac continued as U.S. luxury sales king through most of the 1990s. From 2000 through 2010, Lexus topped the market -- only to have the old European luxury establishment, Mercedes-Benz and BMW, retake the crown after that.

You can reach Lindsay Chappell at lchappell@crain.com.


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