gavriil

Toyota Marking Whopping Sales of Hybrid Cars


Associated Press - October 2, 2003

TOKYO (AP)- The new ecological gasoline-electric hybrid car from Toyota Motor Corp. is selling nearly six times better than the Japanese automaker had expected.

Orders received for the revamped Prius in Japan in September totaled 17,500, more than five times Toyota's target of 3,000, the automaker, based in Toyota city, said Thursday.

The new Prius, which hit Japanese showrooms Sept. 1, will start selling in North America this month. Sales plans for Europe are by the end of this year.

Toyota began selling the Prius in 1997, the world's first commercially mass-produced hybrid car.

The hybrid switches between a gasoline engine and an electric motor to produce the most efficient and ecological ride. The new Prius gets as much as 35.5 kilometers per liter (84 miles per gallon) for driving in Japan, and its mileage is 55 miles per gallon under U.S. driving conditions, according to Toyota.

Toyota has sold more than 120,000 of the initial Prius vehicles worldwide. Toyota President Fujio Cho has said he wants to sell 76,000 of the new Prius cars worldwide in a year.

The latest Prius model is equipped with automated steering to help curbside and back-in parking. The driver does not have to touch the steering wheel for the car to park itself.

Honda Motor Co. already sell hybrid vehicles, and Ford Motor Co., General Motors Corp. and DaimlerChrysler AG's Chrysler Group have also announced plans for hybrid vehicles.

charliemike

The new Prius is actually a pretty nice car ... the fact that they can use regular tires and not donuts for tires on the new car really must have made a difference to people.

Red Nj-s

Great car. Make it basically the same as a regular car, but with amazing mileage. Good job Toyota.

omelette

Has anyone else heard of this? It's been renamed from the Volta to the Priapus

besides being fugly :sqnteek: it's got quite an interesting new name


car info:
http://www.glossynews.com/artman/pub...apus-845.shtml


name info :
http://homepage.mac.com/cparada/GML/Priapus.html

provench

You think fugly?

joerockt

I think it looks pretty damn good...

But $70K+ for a Toyota?? Pass...

provench

Heck - this is cool ... and besides ... I needed something to read to get me away from the R&P forum

joe - so you are saying this couldn't compete with an NSX?

joerockt

I dont care if it could or not, I dont think I would be comfortable paying 70K for a Toyota. So many other cars in that range, like the NSX, that are proven performers. Im suprised they didnt go with the Lexus badge for this...

Also, its a Hybrid. Still not sold on the power issues with those engines.

Revenent

It doesn't look too bad from that angle.

Mind you, I haven' it from all the angles, so I don't have a full opinion.

provench

ooook .... so what car for $70K would you like to compare it to

A badge is what you are worried about? Say it isn't so man!

I do agree on the uncertainty on hybrid, but it's not an if man ... it's a when ... it will overtake the industry once costs are driven down by volumes and then ... quality up

Revenent

With both Honda and Toyota fighting in that area, hopefully innovation and quality will improve very quickly.

I'm waiting for an IMA TSX so I can trade my current TSX in. Hopefully, by the time 2006 comes along, I can do that.

provench

I'm right there with ya

omelette

I dunno, maybe fugly is an overstatement, but I guess it's the bubbly top?

It could just be the angle, dunno.

Revenent

Well, with the Accord going hybrid, that means the entire Honda line should hit hybrid in one form or another within 2 years. So realistically, the Acura line should start getting it another year after that.

Just thinking out loud. Probably way off, but oh well.

It's probably a good thing I own my TSX. Don't really have to think about the financial aspect - short of how much I have to pay extra.

gilboman

but you see no problem paying 30k+ for an accord?

Revenent

I hate to start something like this, but I could say the same thing for paying $40,000+ pre-tax for a decently equipped 3-series.

Even my co-workers think the entire 3-series is over-priced, and I'm pretty sure they can all afford it.

joerockt

Oh, I dont know...M5 maybe??? With a REAL V-10 engine coming up?

Yea, a badge. Lexus is suppost to be a higher quality car then the Toyota. Why did you buy an Acura over a Honda? Why do people buy Infiniti over Nissan? People expect better quality along with those brands. Regardless of the fact that there may not be any production difference between the two, people dont care. They just know Lexus: Luxury, Toyota: Common.

provench

Ok - you got me on the M5 But can it get 30 MPG?

But dump the badge thing ... this car is an EXOTIC ... period ... right? I don't care whose name they put on it.

joerockt

Actually I paid 30K- for my TSX, thanks...and yea I had no problem with paying that at all since I could afford it.

If I could afford a 70K car, it wouldnt be a Toyota...so wipe your ass with the

BTW, go ahead a name a car BETTER, in your honest opinion for under 30K with Navi.

joerockt

If I could afford an M5 I WOULDNT CARE IF IT GOT 2MPG...

Hmmm, I dunno about classifying it as an Exotic. Is the NSX or the M5 considered exotics? I thought the car needed to be hand made for that tag...

majormojo

Which is kind of backwards, don't you think? Acura should be the showcase for Honda's latest technologies and the tech should trickle down to the mainstream brand. Not the other way around.

I still think the S2000 should have been sold as an Acura.

The Toyota hybid under discussion here is NOT fugly IMO, but I sure as heck wouldn't want to have to pick up the tab for replacing that monster windshield!

Revenent

Acura is usually the test bed for performance based technologies. Honda is usually a test bed for the economically based technologies.

At least it seems like it - with the exception of the S2000, of course.

joerockt

Revenent

Maybe it was because it was named S2000 and since it didn't fit with the Acura naming scheme, they left it as a Honda.

Sorry, brain is on looney mode right now.

joerockt

It could have been called the S2000SX

phile

Priapus, eh? Just doesn't have a ring to it.

captainjack

Don't be so literal, Omelette. It's more of a nickname. You ever heard the expression "penis car"? The Volta seems to qualify.

Prius + penis car = Priapus

sauceman

Holy crap, they worked really hard at naming their car that way!!

dom

Looks pretty fugly to me too.

STL

Nope and Nope. The S2000 was released as a Honda to celebration of Honda's 50th anniversary (making automobiles).

AcuraFan

I like the looks of this car...but it does have sorta a 80's concept car look to it.

ClutchPerformer

I bet the M5 can get 30mpg on the highway. Seven gears will do wonders for you.

And high price != exotic

DEI99662

"DETROIT -- General Motors Vice Chairman Robert Lutz said the automaker missed an opportunity to market itself as a technologically savvy company capable of producing hybrid vehicles.

Lutz said GM "missed the boat" on a marketing opportunity with hybrids -- an opportunity Toyota Motor Corp. has played to its advantage.

"We business-cased it, took a hard, analytical look and thought the engineering and investment were irresponsible vis-a-vis our shareholders," he said. "We failed to appreciate what Toyota has basically treated as an advertising expense."

Lutz said GM was doubtful the business case for hybrids would work.

In hindsight, "we should have said, 'We'll lose $100 million a year on hybrids, but we'll take our advertising budget of $3 billion, make it $2.9 billion and treat it as an advertising expense,' " he said.

While Lutz said he finds it hard to view product as a form of advertising, "Toyota very cleverly has used hybrids to gain an improved perception of the brand."

While Toyota continues to sell more hybrids each year -- Toyota sold 53,991 hybrids in 2004, more than twice the 24,627 it sold in 2003 -- GM is just starting to unveil its hybrid technology in its full-sized trucks.

Peter Savagian, GM's engineering director for hybrid powertrains, says GM sold 500 retail hybrids in the western states and Florida in 2004. Savagian says GM wants to sell 2,500 across the United States in 2005.

Lutz said the hybrid market has room to grow.

"Since we've made a major commitment, I don't want the market to go away."

http://www.autoweek.com/news.cms?newsId=101587

SpeedyV6

Heavy Load
For Toyota, a New Small Truck
Carries Hopes for Topping GM

Targeted at Emerging Markets,
Hilux Takes Risk on Quality:
It Bypasses Japanese Plants
Lessons of a Financial Crisis
By NORIHIKO SHIROUZU and JATHON SAPSFORD
Staff Reporters of THE WALL STREET JOURNAL
May 12, 2005; Page A1

BUENOS AIRES -- Martinic Drasko wants 50 new pickup trucks to lease to oil companies that operate in Argentina's hinterlands. But he doesn't want just any truck.

Mr. Drasko says he has tried Ford Ranger and Chevy S10 pickups and a Brazilian-built Nissan truck, but no vehicle has proved more reliable than Toyota Motor Corp.'s Hilux model. "If you break down in remote oil fields, and it's winter, you're cooked," he says.

Now, Toyota is banking on a new version of this sturdy workhorse and a couple of related models it will sell mostly in the developing world as a key part of its strategy to overtake General Motors Corp. as the world's No. 1 car maker. The retooled pickup is Toyota's 21st-century answer to the Ford Model T, a vehicle for the masses that is versatile, inexpensive and highly reliable.

But Toyota is also taking a big gamble on its reputation for quality with its new emerging-market strategy: It's dumping its high-cost plants in Japan as a source of critical components.

For years, Toyota has followed a widely successful formula. It assembled cars in and near local markets, providing jobs and making the products less foreign. But the company produced those cars with engines, transmissions and other key components brought in from the company's world-beating Japanese factories.


That emerging-market business model fell apart during the currency crisis that struck Southeast Asia in the late 1990s. Suddenly, Japanese-made components were prohibitively expensive for buyers using devalued Asian currencies.

So Toyota devised a new approach. It is building the new Hilux and related models in developing countries using parts made almost entirely in factories strategically located to take advantage of regional free-trade zones and cheap labor.

With the new strategy, the company hopes to boost its sales numbers while damping the risks that foreign-currency conversions will eat up all of its profits. But the big question is whether Toyota can keep quality to its lofty standards even as it moves to build more of its cars almost bumper to bumper outside Japan.

Toyota executives say they know achieving a high level of quality is a must if the IMV project is to succeed. Decades of experience Toyota's manufacturing division has in producing vehicles outside Japan "have given us confidence to say we can proceed with the project, even though it almost completely bypasses Japan," says Yoshi Inaba, the Toyota senior managing director in charge of operations in North and South America, Oceania, Asia and the Middle East.

The new Hilux truck, the first of a wave of vehicles built on a single, low-cost vehicle platform known inside Toyota as "IMV," shorthand for "innovative international multipurpose vehicle," hit the marketplace in Thailand last August.

If the strategy succeeds as planned, the Hilux and its related vehicles -- a sport-utility vehicle and a minivan -- will be a crucial part of Toyota's ambitious push to grab a 15% slice of the global auto market by 2010. It had a 12% share at the end of 2004, according to CSM Worldwide, a research firm in Farmington Hills, Mich. Toyota expects the new family of emerging-market vehicles to sell an additional 500,000 vehicles over the old Hilux line, which has consistently sold about 250,000 vehicles a year. The sales jump would make up about a third of the 1.6 million additional vehicles the company needs to sell annually if it is to overtake GM for the top spot. Toyota has no plans to sell the Hilux pickup and its related vehicles in the U.S.

This week, Toyota parked three IMV models outside the hotel ballroom where the company disclosed its latest annual sales and profits. Inside, Toyota President Fujio Cho said the new line was the main reason Toyota's sales in developing markets from Asia to Africa jumped by 362,000 cars, more than the combined increase in sales for developed markets of Japan, Europe and North America.

Toyota's overall sales reached 7.4 million cars, a record. Yet the growth came at a cost. Earnings for the year ended March 31 edged up 0.8% to a record $11.09 billion. But in the final quarter, profits slumped 17% from a year earlier to $2.76 billion in part because of heavy investment in plant and development, including that for the new vehicles.

Big Western and Japanese auto makers have long sold cars and trucks in less affluent, developing countries. But few auto makers have tried a project as ambitious as Toyota's IMV strategy. Toyota wouldn't say how much it spent to develop the new platform and the three basic models based on it, but the company said it sank at least $1.4 billion so far into updating or building plants in Argentina, India, Indonesia, Thailand and South Africa, among other countries, for the project.

The IMV architecture, a basic vehicle building block known in the industry as a chassis, is designed to support a family of rugged vehicles. The vehicles, including the Innova minivan and the Fortuner SUV in addition to the Hilux, will be marketed in 140 emerging-market countries.

By using low-wage factories to make major components, Toyota can offer the new trucks at prices well below the norm in markets like the U.S. The base price for a Hilux pickup is $9,900 in Thailand, for example. In the U.S., a Toyota Tacoma compact pickup -- essentially the same size as a Hilux -- starts at $13,415.

Rivals are skeptical of what GM spokesman Patrick Morrissey calls a "one size fits all" approach to emerging markets. "You can't sell the same car in different markets," says Nissan Motor Co. Chief Executive Carlos Ghosn. "You always have to tune it."

GM uses its global brands and alliance partners to come up with a different portfolio of products for different emerging markets. Ford Motor Co., on the other hand, tries to tap shared technology and vehicle architectures to approach the emerging world. In Asia, for instance, Ford is rolling out a version of the Ford Focus that has been tweaked to Asian tastes but shares basic technology and architecture with the namesake car originally developed for Europe.

Toyota says its IMV-based vehicles are fine-tuned for subtle differences in local markets. Officials also stress that the new models aren't Toyota's only emerging-market offerings. It also sells an affordable entry-level car tailored to various major emerging markets as well as its big-selling global sedans, the Corolla and the Camry.

Behind the emerging-market strategy is a significant shift in the way Toyota operates around the world. Toyota's top brass often touts the "internationalization" of the company, but the car maker has long relied heavily on building engines and other crucial components in Japan. Workers at the company's traditional factories there have long experience with Toyota's brand of highly-efficient "lean" production. One reason the company was reluctant to move such operations off shore was concern about quality.

But in 1997, when the Asian economic crisis triggered a recession in many of Toyota's key developing markets, the company was forced to reassess its strategy. At Toyota manufacturing operations in Thailand and Indonesia, the devastating slide of the local currencies against the yen pushed up the cost of importing Japanese-made components by 80% or more. Those prices made the company's cars just about unsellable in some markets.

Toyota executives also realized that the company's internal system of pricing and discounting made it impossible for them to determine accurately whether the company was making or losing money on each car produced in the Asian region.

Toyota bosses decided the company's developing-market strategy needed a fundamental overhaul, starting with the Hilux trucks.

Toyota's traditional approach to cost-cutting is kaizen, continuous effort on the shop floor to systematize work processes and make them more efficient. But kaizen often yields only incremental savings over time. The approach wasn't adequate to deliver the deep cuts the Asian financial crisis called for, says Kaoru Hosokawa, the executive chief engineer of the team that developed the IMV vehicle architecture and the three models based on it. Mr. Hosokawa says he set out to slash the cost to manufacture each vehicle, including parts procurement and logistics costs, by as much as 30% to make the project viable.

Mr. Hosokawa and other top strategists devised a new plan that completely bypasses Japan as a source of quality but high-cost parts. Toyota located new factories to take advantage of some of the liberal free-trade agreements in different regions, from South America, to Africa, to Southeast Asia.

Gasoline engines for the IMV vehicles, for example, are being made in Indonesia and shipped to assembly plants in Thailand, South Africa and Argentina, among other countries. Diesel engines are being made at a plant in Thailand. Manual transmissions are being shipped around the world from plants in India and the Philippines.

Toyota has set up a war room for IMV production at its office in Bangkok. On the wall is a long line of coded numbers, each representing a component, from wipers to heat sensors to nuts and bolts. Red lines fan out from each component to its subcomponents, which in turn have more red lines going out to further subcomponents. In some cases, the components are traced back to 12 levels of suppliers.

It was drudgery to map out those supply chains. But once they did, Toyota executives discovered all kinds of areas where subcomponents were going back and forth between suppliers, needlessly raising costs. "We found a lot of waste to cut before we even got started," says Akira Okabe, a Toyota managing officer in charge of Asian operations.

In the end, Mr. Hosokawa, the chief engineer, says Toyota was able to reduce the cost to manufacture the vehicles based on the IMV platform by 20% to 25%, compared with old Hilux trucks they replaced. The savings allowed the Japanese auto maker to price those vehicles affordably in the developing world and still make a profit.

Toyota's new strategy has some potential weaknesses. For example, a port strike in India, one of the two sources of manual transmissions, could paralyze Hilux production around the world. Supply lines could also be disrupted by a natural disaster -- another tsunami or earthquake -- or political unrest. Another round of currency upheaval in the region, or changes in tax policies on parts moved across borders could undermine Toyota's strategy.

As insurance, Toyota has created "backup capacity" in Japan and Thailand for each major component and ordered each factory producing the Hilux and its family of vehicles to stock roughly a two-week supply of engines, transmissions and other key components to prepare for an unforeseen disruption in parts production and cross-border shipments. That is a departure from Toyota's traditional ideal, which is to run with very little inventory stored in warehouses.

Through the project, Toyota is also learning that selling vehicles to customers in less developed economies isn't what it used to be. Years ago, auto makers could get away with selling old technology vehicles to relatively isolated Third World customers.

That no longer works, says Mr. Inaba, the Toyota senior managing director. Thanks to the Internet, car makers can't keep consumers in the dark as to what kind of cars they sell in different markets around the world.

At a dealership in Buenos Aires, some customers showed up well before Toyota said anything about its plans for a launch of the redesigned Hilux, waving pictures of the new Toyota model that had already been unveiled in Thailand. They demanded to know when they could get their hands on the new truck, says Mariano Fernandez, vice president of the dealership who manages its day-to-day operations.

Now, Toyota is trying to offer as much up-to-date technology as possible with the new vehicles. The new Hilux, for instance, offers more powerful engines -- including two types of four-cylinder, 16-valve direct-injection turbo diesel engines -- as well as front- and four-wheel-drive versions and either one or two rows of seats. Some versions of the truck also offer antilock brakes and front airbags, although low-end models still come without those features in order to keep them more affordable. "No car maker can get away with the old trick and deprive emerging markets of the latest technology," Toyota's Mr. Inaba says.

So far, sales of the new Hilux and its sister vehicles are brisk. In Thailand, a market Toyota bets will become its biggest for IMV-based vehicles, customers bought a total of 112,300 new Hiluxes in the first eight months after the pickup's launch, compared with the 76,200 sold during the same period a year earlier.

In Argentina, where the economy is showing signs of recovery after a devastating economic crisis in 2002, Mr. Fernandez, the Buenos Aires dealer, believes the new Hilux truck will allow him to expand his sales by 40% this year to 1,400 vehicles. He says that would put his business solidly back in precrisis profitability.

Mr. Fernandez expresses frustration that Toyota isn't making more trucks to meet demand. Toyota's "really conservative," he barked at a Toyota sales representative, Gustavo Salinas, in his showroom one recent day. All Toyota needs to sell more is to open up the taps at the factory: "You just have to produce more," he said.

Write to Norihiko Shirouzu at norihiko.shirouzu@wsj.com1 and Jathon Sapsford at jathon.sapsford@wsj.com2

URL for this article:
http://online.wsj.com/article/0,,SB1...330907,00.html

CGTSX2004

iTrader: (1)

When the Japanese figure out how to take over the truck market, Ford and GM are fucked...

phile

i don't think it's a matter of 'when' anymore. more like 'soon.'

dom

Cliff Notes?

CGTSX2004

iTrader: (1)

Hence the "when" instead of "if"...

Moog-Type-S

....and nice avatar

DownUnder

That won't happen anytime soon, especially since there aren't any trucks from Japan in the foreseeable future to take on the big dogs such as the F250/350, Ram 2500/3500, C/K 2500/3500. They also don’t have 100+ configurable ways of the F series trucks yet nor the capacity of the several manufacturing plants to make close a million trucks like Ford can. Also it’ll take a LOT to sway diehard fans from the Big 3 to buy Japanese trucks and take over the US truck market.