At the recent Los Angeles Auto Show, Lexus showed their Ferrari-challenging LF-A model, priced at $375,000.  And Rolls-Royce showed their new Ghost model, priced at $245,000.  Each is a bold, significant car and will likely sell as their producers predict.  But the fact that the Toyota-produced Lexus can justify its price tag is a measure of how much the automotive world is changing.  Lexus will build only 500 of the LF-A.  A few of those will come to the U.S. and will be offered on a lease-only basis to ensure that they go only to people who don’t plan to “flip” them.

Lexus LF-A

Rolls Royce Ghost

The Los Angeles Auto Show is the most important of its type in the U.S.  Auto manufacturers who have new products to unveil prefer L.A. to lesser shows in Detroit, New York and Chicago.  It also recognizes California’s importance in the creative side of the auto industry.  Most car companies maintain a design studio in Southern California because they acknowledge that automotive innovation, starting with hot-rodding in the 1930’s, is a key piece of California life.

Other dramatic displays included the Dutch-brand Spyker, a small volume, very boldly styled two-seater.

The big theme running through the major manufacturers’ displays was a new generation of small, but interesting, and sometimes fairly expensive smaller cars.  Ford showed their European Fiesta, which will soon be manufactured and sold in the U.S., to compete with Toyota, VW, Nissan and Honda.

Mazda, now with less Ford influence, showed their new “2” series.  I had a chance to drive one in France about a year ago and found it impressive.  Like so many other small cars, it isn’t slow, noisy or cramped like small cars of the past.  Careful space utilization and sophisticated mechanicals make the new generation of fuel-sipping cars extremely road-worthy and comfortable.

A side effect is that makers of higher-priced cars, pushed from below, have to work hard to justify their premium pricing.  At the same time, makers like Toyota, with a sophisticated (and fairly expensive) new Sienna minivan and Honda with their Crosstour, are pushing into high-priced luxe territory.

Displacement

You’ve read about the reduction in the number of auto dealers carrying American brands.  You may have traveled around California and observed empty car dealerships.  Some of them will never re-open.  But others may well choose to sell different brands.  Among those planning big increases in their U.S. presence are Volkswagen (with a huge new factory in Tennessee), Hyundai, Kia, Mitsubishi and Suzuki.  The least prominent of those, Suzuki, is an interesting example.  They’ve been in the U.S. for over 20 years, but haven’t really taken hold.

Now there’s a sort of product renaissance led by a significant new sedan called Suzuki Kizashi.  Most other Asian models have used Anglicized model names like Accord, Camry or Maxima.  Kizashi is boldly Japanese.  The car is a little different too.  Aimed at the Camry/Accord/Fusion sector, it’s about a half-size smaller and more crisp.  It’s like an Audi A4, very compact, evident high quality, tastefully finished with enduring style, and a solid joy to drive.  Most San Francisco buyers will still pay the 50% price premium for the Audi.  But those who test drive the Suzuki will have a tougher decision to make.

Suzuki Kizashi

Suzuki is a big international company; they make about three times as many cars as Chrysler and double Mercedes or BMW.  They have one model that’s typically the top seller in Japan and they’re a big factor in India.  In Europe they sell ten times as many cars as in the U.S.  They have big plans for the U.S., so Suzuki will be looking to franchise some of those ex-domestic dealers.  Those other brands will too.

The upshot of all this:  Consumers have NEVER had a better range of choice.