Toyota Motor Corp., which made it big on small cars, is establishing a separate large luxury car group in the United States, in hot pursuit of the baby-boomer dollar.

The company refuses to give details of its new division, but sources familiar with its plans said that the move will be announced in mid-August. The new division, these sources said, will sell three cars, ranging in price from about $20,000 to $30,000, the first of which will go on sale in October 1988.

Establishment of the new division will set Toyota on a path that other foreign car makers are already treading. Volkswagen, which pioneered the low-priced import, has been bringing its Audi models into the United States since 1970; Honda Motor jumped into the upscale market last year with its Acura line, and Nissan announced last week plans to develop and market a new luxury line in this country.

The reasons for the shift are plain, according to industry analysts. Foreign auto makers are being forced up the retail ladder by changing conditions in the U.S. car market, chiefly the aging of the baby boomers, who are entering their early and mid-forties and many of whom have annual family incomes of $40,000 or more.

"The baby boomers grew up with imports. But they often started out with small economy imports," said Susan G. Jacobs, vice president for automotive research at Merrill Lynch Economics Inc. in New York.

Now, they are moving into their most productive and lucrative years, Jacobs said. They have children and egos. Bigger and fancier cars are in. Small "econoboxes," regardless of quality, are out.

That is why the luxury car segment is growing, while the small- and midsize-car markets are retrenching, Jacobs said. Subcompact cars, for example, constituted 26 percent of the market in 1986, but will make up 24 percent of U.S. auto sales in 1990, according to Merrill Lynch figures. By comparison, luxury cars occupied 12.5 percent of the market last year, but will take a 13.5 percent share in 1990, the Merrill Lynch analysis says.

Also, "maturing, affluent buyers" -- persons in their forties earning $40,000 or more a year -- account for more than 50 percent of the new cars sold in the United States, according to a new study of U.S. auto market trends by the California-based research firm J.D. Power and Associates.

That means the Japanese, particularly, must attack the high ground to protect their American sales, which now translate to 21.7 percent of the U.S. auto market, Jacobs said.

The Japanese need more attractive cars to hold onto the boomers they weaned away from domestic models in the last two decades. They also need cars with enough status to get those they never got -- that pricey, image-conscious set given to buying Audi, Mercedes-Benz, Porsche and Jaguar models.

Honda Motor Co. Ltd., so far, is leading the way in the Japanese push for U.S. "luxcar" dollars. Honda's Acura Division sells V-6, 24-valve Legend sedans and coupes at base prices ranging from $20,000 to $26,000 and four-cylinder, 16-valve Integra passenger cars from a base of $10,000 to $13,000.

The Acura Division had a lackluster start, with sales of 52,869 cars in 1986. But the division so far has sold more than 51,000 cars this year, and some analysts are predicting that Honda's new group will sell in excess of 100,000 cars in the United States by Dec. 31.

Nissan Motor Co. Ltd.'s new division, called Infiniti, plans to start selling $25,000 to $30,000 cars in 1989. But many analysts contend that Nissan, which has had organizational problems in Japan and image problems in the United States, will have a hard time keeping up with Honda and Toyota in the luxcar race.

"People don't really buy luxury cars in that price range. They buy status," said Thomas O'Grady, president of Integrated Automotive Resources, an auto industry consulting firm in Wayne, Pa.

Japanese auto makers, as a group, have yet to convince Americans that the Japanese can build cars competitive with the likes of BMW and Mercedes-Benz, O'Grady said. And Nissan, which has wedded itself to the econocar image more than Toyota and Honda, will have an even more difficult time in that endeavor, he said.

"You can't sell a $30,000 car unless it says: 'Wow! This is a really special and different car,' " O'Grady said. "You can't sell it on 'luxury' alone, because you can get luxury in a Chevrolet Caprice. The people who buy $30,000 cars are looking for status."

Still, "Nissan is doing something that it has to do" in pursuing the luxury car market through a separate division, O'Grady said.

Anybody who thinks the Japanese can't compete at the top end had better think again, said Christopher Cedergren of J.D. Power. "You keep hearing all of this stuff about the Japanese not being able to take on BMW. "That's a lot of nonsense. The Japanese will be selling 700,000 to 800,000 luxury cars in this country by 1990, and many of those cars will have better quality and lower maintenance costs than BMW and other German models.

All of this is bad news for the beleaguered luxury car divisions of the American auto makers, particularly the Cadillac Division at General Motors Corp., analysts said.

"Problems? Problems? I know we have problems. I hear it all the time," said Charles M. Jordan, vice president in charge of GM's design staff. But Cadillac is fighting back with its new $54,000, Italian-designed Allante model and a U.S.-reworked design of its once-popular El Dorado model, Jordan said.

The issue is important for reasons that reach beyond questions of image. Profit margins on cars tend to grow with price, meaning that a car maker makes a lot more money selling a $20,000 auto than it does on a $7,000 model.

The reason is that it takes little more energy and labor to build a luxury car than it does to build an economy model, said James A. Mateyka, vice president for auto industry analysis at Booz, Allen, and Hamilton Inc.

Despite the Japanese auto makers' stated intention to go after the Europeans, "when you look at the pricing of cars like the Legend, they're really hitting at the top end of the domestic midsize-car market," Mateyka said.

The American companies can ill afford a successful foreign challenge in the intermediate segment, "because that's where the U.S. companies make most of their money," Mateyka said.

Meanwhile, Ford Motor Co. is trying to shore up its luxury offerings with its Ford of Germany-designed Merkur models, sold through the company's Lincoln-Mercury dealerships, and Chrysler is burnishing its image with the Chrysler TC Coupe designed by Maserati.

The European auto makers are on the move, too. Audi, for example, which has suffered a tremendous sales setback because of allegations of sudden acceleration in its cars, is readying four new models, including a $100,000 "image-leader" for sale by 1990.

In the future, no company will have a safe spot in the luxury segment of the U.S. car market, Cedergren said. "I don't expect divisions like Cadillac and Lincoln-Mercury to disappear, and I don't expect the Japanese to wipe out the Germans. But with all of the new players in the luxury market, everybody's going to have to live with a smaller share."