Toyota (TM) and its Lexus Challenge

With the battle with competitors heating up in the luxury car market and the unfortunate earthquake and tsunami in Japan, Toyota (NYSE:TM) has its hands full fending off their competition and being able to supply the vehicles needed to compete.

"Lexus, already struggling with limited supply and weak sales is finding itself wrestling with two big problems: rebuilding its inventory after the earthquake hit Japan and fighting off other automakers who are aggressively going after luxury car buyers," says CNBC's Phil LeBeau.

"Toyota is intent on overcoming both hurdles, but for now, both are putting the squeeze on America's #1 luxury brand.

"Toyota deciding to halt production in Japan through Tuesday, March 22nd means an already tight supply of Lexus models will become even tighter. As I talk with dealers they tell me Toyota probably has 40-45 days supply of Lexus models. A more normal supply would be 60-65 days. Compounding the issue of a tight supply is the fact 75% of the Lexus models sold in this country are built in Japan. Sure, the popular RX models are built in Canada, and production there is going as scheduled. But all the other Lexus models are Japanese made."

Toyota was trading at $80.04, down $1.35, or 1.66 percent, as of 12:41 PM EDT.




Source