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Reflecting on the world's trend on saving crude oil consumption and to create an economical fuel efficient vehicle for the increasing world population, a new THS-II HV powertrain has been developed for the compact vehicle class. The application of a THS type powertrain for the compact vehicle class was a first for the world and to achieve it, brand new hardware, and software needed to be developed. For the Internal Combustion Engine (ICE), state of the art technologies such as the use of the Atkinson cycle with Variable Valve Timing (VVT), cooled exhaust gas recirculation (EGR), an electric water pump, a compact exhaust manifold, a Low Friction chain, beltless system and exhaust heat recovery system were applied. For the electric motor, copper wire with a rectangular cross section and divided stator cores combined with a newly developed production process were applied for higher volumetric density.

Lexus launched the new hybrid luxury coupe LC500h in 2017 to help enhance its brand image and competitiveness for the new generation of Lexus. During the development of the LC500h, major improvements were made to the hybrid system by adopting the newly-developed Multi Stage Hybrid System, which combines a multi stage shift device with the transmission from the previous hybrid system to maximize the potential of the electrically-controlled continuously variable transmission. Optimum engine and electrical component specifications were designed for the new vehicle and transmission. As a result, the LC500h achieves a 0-to-60 mph acceleration time of 4.7 seconds, with a combined fuel economy of 30.0 mpg while satisfying SULEV emissions requirements. Two controls were constructed to help resolve the issues that arose due to adding the shift device.