TOKYO -- The yen's surge against the dollar is pinching Lexus as the brand tries to work out the price of its new GS sedan.
Toyota's premium brand also will have to consider sourcing more cars from North America if the yen stays at its current exchange rate around post-World War II highs.
Kazuo Ohara, deputy chief officer for the Lexus Group, says the brand is still seeking a good price for the U.S. version of the GS and aims to decide by December.
The sticker on the base 2011 GS 350 sedan is $47,775 including shipping.
The yen's profit-eating strength undercuts the margins on Japan-made vehicles priced in dollars. But boosting prices to soften the foreign exchange blow cedes ground to rivals.
"We have to keep the price within a certain band," Ohara said.
The redesigned 2013 GS sedan goes on sale next spring. U.S. sales of the current generation model peaked at 33,457 units in 2006 and tapered off to 7,059 last year. Lexus is counting on a competitive redesign to lure customers from the BMW 5 series, Mercedes E class and Audi A6.
Ohara said Lexus will have to think about sourcing more Lexus models locally, including possibly shifting production of a new model to the United States, if the yen stays at its current level around 76 yen to the dollar. A year ago, it was 81 yen; a year earlier: 91 yen.
One possible candidate for future U.S. production is the ES sedan, Ohara said. That is because it shares many components with the Toyota Camry sedan made in Kentucky and Indiana.
The brand also may try to pump up the ratio of RX crossovers that are sourced locally. Currently, the RX is the only Lexus model made in North America, in Cambridge, Ontario.
But about 20 percent of the RXs sold in the United States are still imported from Japan. Ohara said the company may try to reduce the number of imports and lift local output.