Toyota: Pragmatic Short-Term, Bullish Mid-Term and Long-Term

Toyota Motor Sales U.S.A. Inc. will have national sales promotional campaigns in May, August and December, Bob Carter, group vice president and general manager-Toyota Div., says at the NADA convention.

The campaigns are in keeping with past practices and will be regionally unique, such as emphasizing leasing on the East Coast and cash discounts in the Midwest.

Although it may not have brought buyers into showrooms, Carter says dealers liked the splash Toyota made with its fall “Saved by Zero” 0% financing marketing campaign.

“We feel very confident,” Carter says of Toyota's message to dealers during its franchise meeting. “We're pragmatic on the short-term but very bullish on the mid-term and long-term of where the U.S. industry is going. We think we're well-positioned for the future.”

While the auto maker doesn't predict a recovery in the slumping U.S. new-car market until at least the year's second quarter, Carter says Toyota's January sales are ahead of plan for the month.

“January is one of those months in the car business you hold your breath on,” he says. “And actually, in many of the markets outside the deep freeze, we're running slightly ahead (of) where we thought.”

Toyota's sales have been down compared with year-ago.

Pent-up demand (Toyota estimates there are 900,000 buyers waiting on the sidelines) and changing consumer preferences point toward a possible run-up in “frugal” vehicles, Carter says. “Frugal is cool,” he says, noting subcompact, compact and midsize models will be the first vehicle segments to recover when consumers return to showrooms.

Meanwhile, Carter says there is no plan in the U.S. to sell the second-generation Prius alongside the new third-generation model, which goes on sale this spring.

A report out of Japan last week said Toyota would sell the two together in its home market, with the second-generation Prius being called “Prius Classic” and taking on Honda Motor Co. Ltd.'s new, lower-priced Insight hybrid-electric vehicle.

Toyota considered such a scenario for the U.S. market, as well, but concluded it wasn't feasible, Carter says.

“It was studied very briefly months ago,” he says. “Until the last 60 days, we've had a tremendous problem keeping up with supply and demand for (the) Prius.

“So we did a couple studies (on whether we could) maximize availability if we had two Priuses. We looked at it. It didn't make sense, and we moved on.”