When Toyota unveiled their all-new, supersized Tundra pickup, they confidently predicted/promised that the model would hit 200k sales in its first years. Despite some early teething troubles (e.g. underestimating demand for the iForce 5.7-liter V8 engine), strong competition (e.g. GM's determination to discount its Silverado and Sierra to thwart the competition) and economic headwinds (i.e. a contracting housing market and rising gas prics), Toyota execs reckon they just might meet the target. Admitting that "It's going to be close," ToMoCo's U.S. group vice president and general manager laid out the results of regional battles “We’re seeing record market share on the West Coast and good growth elsewhere, particularly in the Midwest,” Bob Carter told WardsAuto. “Tundra has maintained leadership in California and has gained leadership in the Pacific Northwest.” Sales of the Texas-made Toyota climbed by 43.2 percent in November (compared to sales of last year's outgoing model). Although Ward's forgets to mention it (doh!), Toyota sold 177,336 Tundras YTD. That leaves them with 22,664 Tundras to go.
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Here in rural NE, several of my friends that bought domestic trucks have been very unhappy with their purchases. The mechanical problems were annoying, but the dealers are what really got them pissed off.
Two of them “broke down” and bought a Tundra and have been very happy with the decision and went as far as saying that it’s what they should’ve done 10 years ago.
But it’s not just the launch problems. It’s that the Tundra has been recalled a worrying number of times. The engine tries to eat itself. The bed shimmies. The tailgate’s useless. This isn’t what Toyotas are famous for.
“e.g. GM’s determination to discount its Silverado and Sierra to thwart the competition”
You’re kidding right. What has the Toyota been doing with the Tundra then? Tundra’s incentives have been running higher than the new GMTs for at least the last seven months. It’s par for the course right now in the full-size truck market. If anything, though, GM is holding incentives more than Toyota if you look at the increases in incentive spending over last year. Even Ford didn’t start playing Toyota’s game, despite their four year-old model until later in the summer.
The truth is that Toyota is in danger of missing its goal. Its rate of increase in sales is slowing significantly since the summer and it needs nearly a 90% increase over last year in December to make it 200k. How will they get there? The same way that the domestics got themselves in their current mess… they will discount the heck out of the trucks, dump them in fleets and pray to God they don’t eat their own words.
Later next year they will face even stiffer competition from Dodge and Ford. What then? Toyota has the capacity to build 350k units in San Antonio. I have never seen such under-utilization from this company. It is one of the many reason why I think the Toyota machine is going to hit a lot of bumps in the future… and we know what happens to the Tundra’s bed when it goes over lots of bumps…
I think its the other way around, Toyota is discounting the heck out of the Tundra to thwart Detroit.
Its not quite predatory pricing tactics, but it takes food (profit margins) out of Detroit’s hungry hands.