Toyota Motor Corporation (ADR) (TM) & A Trio Of Auto Stocks Worth Looking At

However, this point of view has flipped since Lexus has made a revival in the American market. GS expects Lexus’s contribution to Toyota Motor Corporation (ADR) (NYSE:TM)’s operating profits to rise to 22% through 2015. Lexus has helped Toyota to penetrate the high margin luxury car segment over the years. Five factors have led to an improvement in Lexus sales:

(1) Toyota appears to have regained customer confidence on product quality

(2) Its price competitiveness has improved substantially with recent yen weakness

(3) Lexus’s independence from Toyota Motor Corporation (ADR) (NYSE:TM) (as a brand) has been ensured under the new company structure

(4) Lexus has introduced a unified design structure and new products (compact SUVs)

(5) It has acquired diesel engine technology through a deal with BMW.

My Foolish Take

Rising US SAAR has helped both the Detroit-based automakers as well as Japanese players. General Motors Company (NYSE:GM) and Ford Motor Company (NYSE:F) both are recommended as buys on the premise of being cheap and improving cost structure in Europe. Toyota Motor Corporation (ADR) (NYSE:TM), on the other hand, is recommended as a buy on the revival of its premium brand Lexus.

The article 3 Auto Stocks to Buy originally appeared on Fool.com.

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