Toyota sputters as market shifts; Like Big 3, has too many Trucks, Lacks Small Cars

[treekiller]

Lets keep in mind the Yaris is built in Japan.

It cost a lot more to build a car in Japan. (Never Thought I'd ever say that)
Shipping from Japan costs more $$ now
The Exchange rate sucks when they send the money back to buy more yari...

I'm going to bet you'll see a shortage of these $10,000 imports just like the Prius shortage. why sell 1,000,000 of a car that does not make you money. and a Yaris. built in Japan shipped to here and exchanged to death... is not going to make Toyota a ton of money..

Now the Camry. Built here, overpriced, and lackluster. that can make them money if people keep buying into the "Toyota is better quality" BS..

My GM cars were just as good as my Toyotas, actually the paint was much better, and I had less Engine failures.. Sure the GM cars needed more little odds and ends. knobs, trim pieces etc. but 250,000 miles without an engine overhaul speaks volumes. The most I got out of either of my celicas was 125,000 before the engines showed issues.. and one even spit off it's oil filter.. Replaced the engine.... it spit off the next oil filter. 2 engine failures in the same car huh...

[ScottS]

Very selective reading folks.

It's one thing to not be selling cars because your product mix is wrong and only a couple cars out of many are near class-leading.

It's another when your problem is that your car plants have more demand than production can meet. From the article, "They're maxed out in production of Corolla and Camry cars in North America." A coworker told me Tuesday that his son went to order a Prius and by time they get to his order, it may be a few months and it will likely be an '09 model.

Apples and oranges. Yes, the Tundra was ill-timed in retrospect, but it's not like the rest of Toyota's lineup was full of mediocre cars, and even the mediocre cars they have carry cache from Toyota's built up reputation.

[PhishPhood]

Originally Posted by goblue

While this is technically correct, all of you are missing the key point in the article.

Toyota suffered because their product mix in the dealership was wrong. A relatively easy thing to fix.

GM suffered because their small cars are not competitive and their midsize cars just became competitive. The only place GM has significant advantage is in large crossovers. IE people dumping BOF SUVs who still want space.

In other words, Toyota can use their newer, more flexible plants to fix the problem. GM can't sell competitive cars that it doesn't even have ready to go, let alone in plants currently.

Toyota and GM didn't fall victim to anything. Neither one did anything stupid in regards to SUVs / Trucks. No one could predict the tipping point ahead of time with any certainty. Everyone knew they'd take a bath when it finally hit, but there was lots of money to be made in the interim. This is where the media gets it totally wrong. The companies were taking calculated risks, thats what you do in business. They both have hedges - GM has the VOLT, 2 Mode, E-Flex, mild hybrids, E85, diesels, excellent large crossovers. Toyota has hybrids, great small cars, a fantastic midsize reputation.

What happened is the tipping point came a little too soon for GM, and simply surprised Toyota which in 2008 was better setup to deal with it. Had this happened in 2010, it might be different.

All of the above is very accurate. Conditions just arrived a lot faster than anyone could have imagined. Just by being a player in the BOF segment every member is getting hurt. Those that weren't players such as Honda gave up HUGE profits over the last 15 years. Those that weren't players such as Honda aren't stuck with lot anchors in the short term.

To read anything more than this being a shortterm serendipitous situation for HOnda and Hyundai and Mazda is reading far too much into it.

As you correctly said, if it happened 18 mo's later GM and Ford would be fairly well along in a new direction. This just sped up the changes that were started in 2001 and since. Case in point, the lambda's and the Edge are well positioned and fully market-ready to catch all the defectors from the Tahoe/Yukon/TrailBlazer/Envoy and from the Expedition/Explorer respectively. Both companies saw what was occuring. It was all over the monthly sales stats since 2003. Their midsizers are just as good if not better than everyone else's. The only glaring gap is in the compact segment where both entries are mediocre. They haven't been able to bring these up to competitive levels across the board....and make a profit from them.

For Toyota its a minor inconvenience in the long term. Fast forward 2 years and one of its three BOF plants may be converted to some kind of unibody vehicle plant. It's a temporary hiccup for a company with no debt.

[PhishPhood]

Originally Posted by osv_alero

I disagree. As toyota has been introducing new compact cars, their gas mileage ratings have been going down. Check out scion as a perfect example. toyota will need to revamp their product line if they want to be class leading with the mpg area.

Besides the prius, there is no toyota that is class leading in the gas mileage area.

Your misconceptions need updating......

The Yaris is the leader in the tiny segment.
The Corolla is 2nd only to the Civic because of the weight of the hybrid Civic.
The Camry is the leader in the midsized segment by a HUGE margin... you have to factor in 20% hybrid sales.
The Avalon is the leader in the large cars segment.
Ditto the Highlander in the V6 midsized SUV segment. The small number of hybrid sales makes it solidly NO 1.
The Escape/Tribute/Mariner hybrids rule the small SUV segment.

Go here http://www.fueleconomy.gov/feg/byclass.htm and check each of these Market Class segments for 2008.

The Scions are mediocre for sure.
Trucks are trucks. The one mpg difference here or there is insignificant. The first one to market with a good number of diesels will be the runaway leader.
Ditto big SUVs but this segment is shrinking before our eyes and nobody cares anymore. Midsized SUVs are DOA.

[Sal Collaziano]

You'd think that the domestic brands might start making some serious sales being that Toyota's run out of small cars (cannot meet demand). However, it appears as if people would rather WAIT a few months than simply purchase a domestic alternative.. Now that's really sad (for domestic vehicles, anyway)...

[racy]

Originally Posted by AMERICA 123

Also wouldn't be surprising to see Honda go past them (8 - 24 months) and Hyundai pull in right behind them ( 24 - 48 months ) in NA.

Nice thought, but Hyundai simply doesn't posess the manufacturing capability for such a jump in sales. They mught be able to sell the metal, but they can't build it fast enough.

[GReekBoy]

Originally Posted by camaro_freak

lack of maturity on this board never ceases to amaze me

'cloud of rice'? can you get any more racist with that type of comment?

funny what a simple search shows

04-20-2006, 09:25 PM
camaro_freak
the wing has to go though... too much rice

never knew saying rice was a racial slur. grow the **** up. i guess crotches get offended when people say crotch rockets


guess that makes you racist toooo!!!!

[AMERICA 123]

Originally Posted by racy

Nice thought, but Hyundai simply doesn't posess the manufacturing capability for such a jump in sales. They mught be able to sell the metal, but they can't build it fast enough.

They won't have to, nor will Honda - IF Toyota's coming down as well - which is exactly what happened last month.

Toyota was an easy 28,000 - 48,000 'lite' last month depending on how you want to look at it.

Even more than that if you believed the BS that they were going to pass GM - and yes I'm keeping in mind GM's much, much better than expected performance.

If you look closely, GM had Toyota beat even without the special month end sale stuff although that obviously increased the margin - because Toyota was so 'off''.

Go look at how much ground both Hyundai and Honda just gained on Toyota.

Everybody did - except Ford and Chrysler.

Nissan was a case of not so much - but still in their favor - and usable.

[AMERICA 123]

Originally Posted by A Bum In A Bus

I hope and pray everyday that Toyota goes bankrupt, out of business, broke, implodes and goes up in a cloud of rice dust.

Same here.

At this point, it's fair to say that everything from Toyota themselves, the market, the universe, and everyone else in the industry are working on it - hopefully this past June was the start of a long term trend - even a sawtoothed decline will work.

They must be stopped.

Then they must be pushed back - off the island - here there and everywhere.

[AMERICA 123]

Originally Posted by Ming

Honda, Hyundai and KIA at least are well positioned to steal sales from Toyota.

Suzuki could have been well positioned if they weren't trying so hard to emulate Detroit/Toyota and had a lineup here that more accurately reflected their strengths overseas (small, ultra fuel efficient cars).

Exactly (to all) - and more are as well including almost unbelievably, - given all the exchange rates, some of the European makes.

Mazda in a sense, also - the Toyota Venza ? ain't going to wack the CX7 - more the other way around and there maybe more play from the new MX6 etc.

Come to think of it............ this matters as well ........ from the original linked article.

At a meeting last month in Salt Lake City, dealers pressed

Toyota's top U.S. managers to explain why the carmaker renowned for its responsiveness and flexibility couldn't provide them with more small cars.

"They're maxed out in production of Corolla and Camry cars in North America, and there's nothing more the U.S. staff can do," said

Rosario Criscuolo, a Michigan dealer with showrooms in Lansing and Ann Arbor who attended the meeting.


- "I don't think the management we have now at Toyota has ever seen anything of this sort."


- "Toyota is no longer considered immune from the market forces at work in the United States," said Aaron Bragman, an auto analyst at Global Insight.


- Toyota already had warned investors in May that its annual profits would fall for the first time in seven years because of weakening demand in

the United States, where analysts estimate it generates half its earnings.


- Toyota's difficulties reflect a combination of factors:

the ill-timed launch early last year of its Tundra full-size pickup,

and a decision to take more time to develop new vehicles to nip quality problems that were starting to hurt the automaker's reputation.

That led to delays in the rollout of a redesigned Prius hybrid and other models that dealers had expected to see this year.

"You're looking at a company at a difficult time and place in its history," said Maryann Keller, an auto analyst who heads her own consulting firm,

Maryann Keller & Associates in Stamford, Conn.

[A Bum In A Bus]

Originally Posted by camaro_freak

lack of maturity on this board never ceases to amaze me

'cloud of rice'? can you get any more racist with that type of comment?

Speaking of maturity, if you don't like what I post, DON'T READ IT. Calling someone a racist is really mature, you wouldn't know racism if it bit you in the ass, peckerhead. Maybe you should join the Toyota board, that seems to be your automotive preference.

[joemac]

Originally Posted by ScottS

Very selective reading folks.

It's one thing to not be selling cars because your product mix is wrong and only a couple cars out of many are near class-leading.

It's another when your problem is that your car plants have more demand than production can meet. From the article, "They're maxed out in production of Corolla and Camry cars in North America." A coworker told me Tuesday that his son went to order a Prius and by time they get to his order, it may be a few months and it will likely be an '09 model.

In rebuttal, the Corolla and Camry were down month to month May to June roughly 20%. A manufacturer with production constraints doesn't lose 20% volume from one month to the next.

Some have eluded to a fleet dump last month for Toyota on the Corolla and Camry as they set new all time sales records for a single month. A manufacturer doesn't set a record one month, then drop 20% next with production constraints. Nor does one fleet dump (alleged) vehicles if retail sales are in short supply.

[ericmvest]

Originally Posted by goblue

In other words, Toyota can use their newer, more flexible plants to fix the problem. GM can't sell competitive cars that it doesn't even have ready to go, let alone in plants currently.

Toyota has hybrids, great small cars, a fantastic midsize reputation.

One line at TMMI (Princeton, Indiana plant) and TMMTX (San Antonio, Texas plant) is engineered to produce body on frame trucks and is not flexible to build unibody cars. Also, Toyota is building a new plant in Mississippi when it is not fully utilizing its existing plants.

Also, using "great" to describe Toyota's small cars is an over statement. I would not call the "all new Corolla" great. Maybe competitive, but not "great."

[skylark68]

Anyone hear about the Toyota engineer that died from overwork? It was posted yesterday on Yahoo news. The guy was putting in loads of overtime and his heart basically quit. I heard it was the norm for Japanese companies to encourage this. The Japanese government is cracking down supposedly on this practice. I feel sorry for him and his family.

[PhishPhood]

Originally Posted by PhishPhood

All of the above is very accurate. Conditions just arrived a lot faster than anyone could have imagined. Just by being a player in the BOF segment every member is getting hurt. Those that weren't players such as Honda gave up HUGE profits over the last 15 years. Those that weren't players such as Honda aren't stuck with lot anchors in the short term.

To read anything more than this being a shortterm serendipitous situation for HOnda and Hyundai and Mazda is reading far too much into it.

As you correctly said, if it happened 18 mo's later GM and Ford would be fairly well along in a new direction. This just sped up the changes that were started in 2001 and since. Case in point, the lambda's and the Edge are well positioned and fully market-ready to catch all the defectors from the Tahoe/Yukon/TrailBlazer/Envoy and from the Expedition/Explorer respectively. Both companies saw what was occuring. It was all over the monthly sales stats since 2003. Their midsizers are just as good if not better than everyone else's. The only glaring gap is in the compact segment where both entries are mediocre. They haven't been able to bring these up to competitive levels across the board....and make a profit from them.

For Toyota its a minor inconvenience in the long term. Fast forward 2 years and one of its three BOF plants may be converted to some kind of unibody vehicle plant. It's a temporary hiccup for a company with no debt.

WOW..this happened a lot quicker than I expected....

Announced today..http://pressroom.toyota.com/Releases...T2008071034962 ( susbject of another thread in the news articles forum as well )