SAN FRANCISCO (Reuters) - Toyota Motor Corp (7203.T) sees a “tough” situation for U.S. sales with a strong Japanese yen, particularly for its Lexus and Scion brands, said Jim Lentz, president of Toyota Motor Sales.
Lentz, the second-highest ranking executive of the U.S. sales branch of the world’s leading automaker, said he expects the dollar to strengthen versus the yen, making U.S. sales of Toyota’s vehicles made in Japan easier.
“Sure, we’re always concerned about that,” said Lentz when asked about the strong yen by reporters on the sidelines of the National Automotive Dealers Association annual convention. “A yen that is sub-85 is a very tough situation.
“I think given the weakness of the economy in Japan, I don’t think this 80 to 85 yen is going to be there long. I think we will see some movement as the yen weakens and the dollar strengthens,” Lentz said.
Currently, the yen is 82.21 to the U.S. dollar.
About two-thirds of the Toyota brand vehicles are produced in North America, which makes it less exposed to the strong yen as far as offering value to U.S. consumers than Toyota’s luxury brand Lexus or its youth-oriented brand Scion, Lentz said.
Less than 45 percent of Lexus lineup sold in the United States is made in North America, and none of the Scion brand vehicles are made in North America.
So far, there has not been a major impact on U.S. sales due to the exchange rate, Lentz said.
“I don’t think it’s necessarily biting into our sales,” he said. “We are very cautious that we don’t have a bloated pipeline of products because we’re not going to chase it with incentives. “
In mid-January, Toyota President Akio Toyoda said the company could move some production away from Japan because of the strong yen.
“I do not want to relocate production simply because of something like foreign exchange rates...if we are simply unable to make a profit, however, we may be forced to,” Toyoda said last month.
Reporting by Bernie Woodall; Editing by Diane Craft