The Toyota Camry began a streak of 14 consecutive years as America’s best-selling car in 2002. Holding that number one position isn’t easy.
Toyota does not merely need the Camry to continue to live up to its reputation for reliability, and subsequently incite demand. Toyota also requires massive production capacity and a pricing scheme that matches production capacity to demand.
Demand in the United States for conventional midsize cars, however, is falling quickly. Year-to-date, overall midsize car volume is down 8 percent. In July 2016, midsize car sales fell 15 percent.
With a 2016 Camry now attempting to leave dealer lots as a five-year-old car, more than two years since its last refresh, Toyota’s desire for the Camry to maintain its high-volume nature and best-selling posture is now matched by a significant uptick in Camry incentives.
Toyota is now discounting Camrys 27-percent more than just one year ago, with an average incentive spend per Camry of $3,760 in July.
According to Autodata figures in this Automotive News article, Toyota has ramped up Camry incentives in nine of the last twelve months, from $2,969 per Camry in July 2015 to $3,459 in December 2015, to the peak of $3,760 per Camry last month.
Year-over-year, Toyota’s average incentive spend per Camry is also up 27 percent through the first seven months of 2016.
As Camry competitors similarly experience disappearing demand, incentives are the name of the game. The Camry is by no means an exception on that front.
Fiat Chrysler Automobiles’ clear out of the nearly discontinued Chrysler 200 (despite the 200 deemed uncompetitive by the collective consumer) puts a measure of pressure on cars such as the new Chevrolet Malibu. Select 2016 Malibu LTs are now advertised with a $4,143 cash back offer, for instance.
On August 10, Ford added $1,000 Smart Bonus Cash to the older half of Fusion stock, and even on some newly refreshed 2017 Ford Fusions.
Until a 26-percent July sales slide dropped it one place, the Nissan Altima was America’s second-best-selling midsize car in 2016. To spur demand, Nissan offers interest-free financing for six years with at least $500 in bonus cash.
The list goes on.
Despite the incentivization, Americans nevertheless purchased and leased 116,000 fewer midsize cars in the first seven months of 2016 than during the same period one year ago.
Toyota appears entirely unwilling to see the ageing Camry lose sales faster than the segment as a whole.
Year-to-date, Camry volume is down 8 percent, a loss of 20,369 sales in a category that is likewise down 8 percent inside a passenger car sector that’s down — you guessed it — 8 percent. The Camry’s 4,313-unit decline played a significant role in the month of July, specifically, as midsize volume plunged by 31,000 sales.
The upside is easy to locate in Toyota showrooms. With similar MSRPs, U.S. sales of the Toyota RAV4 are up 16 percent this year, a year-over-year gain of 27,487 sales, which more than counteracts the lost Camry volume.
The RAV4 isn’t simply keeping pace with growth in the SUV/crossover sector, either. Presently America’s top-selling utility vehicle, the RAV4’s 16-percent volume expansion comes as U.S. SUV/crossover sales grew 8 percent in the first seven months of 2016.
While TrueCar says buyers of the 2016 Toyota Camry XLE are paying 10-percent below MSRP, the 2016 Toyota RAV4 XLE AWD buyer nets only a 3-percent discount.
Through the end of July, the Toyota Camry holds an 11,090-unit lead over America’s second-best-selling car, the Honda Civic. At this stage of 2015, the Camry was 33,871 sales ahead of the next-best-selling car, Toyota’s own Corolla.
The Toyota Camry is by no means dying, but some of its competitors might. TTAC recently forecasted the demise of a number of midsize sedans; that the continued rise of two-row family crossovers will kill off more midsize cars until the segment stabilizes with an appropriate number of competitors.
The significant discounts applied to America’s perennial best-selling car, a midsize Toyota that wears its blue chip credentials on its sleeve, is more evidence of that eventuality.
[Images: Toyota. Chart: © 2016 Timothy Cain/The Truth About Cars]
Timothy Cain is the founder of GoodCarBadCar.net, which obsesses over the free and frequent publication of U.S. and Canadian auto sales figures. Follow on Twitter @goodcarbadcar and on Facebook.
I wonder if Toyota makes any profit on the Camry at that level of discount. RAV4, Highlander, and Tacoma sales have got to help, but it’s not like they have 700,000 annual high-margin full size pickup sales to fall back on.
I would be shocked if Toyota didn’t make a profit even with these discounts. They have already sold about 2 million Camrys in the US since 2011, and many aspects of the design date back to 2001. Toyota has sold about 6 million Camrys since then. A lot of the design/tooling has long since been payed off.
Yeah I bet the net profit per Camry is one of, if not the lowest per segment, 200 excluded. Not only do they spend heavily on incentives and low lease deals their advertising budget is huge. There are far more ads on TV and radio than for any other Toyota product.
Considering that the Camry’s chassis is the same one that debuted on the 2002 Camry, it has long since been paid for. I am sure they are doing just fine
This is incorrect. It is not the same chassis as the 2002 model. The 2007 was a new platform and it shares the platform with that. The 2018 model will be an entirely new platform.
kit, just look at the roofline (c pillar especially), it’s been riding on the same ‘bones’ since 2001.
en.wikipedia.org/wiki/Toyota_K_platform
Not saying that is a bad thing, they are excellent bones indeed.
30-mile fetch, Toyota sells slightly different versions of the Camry all around the world and they reuse lots of the same parts across 2 or more Camry generations. They clearly get their money’s worth out of their product development and tooling budgets. Given Toyota’s ability to spread fixed costs across millions of Camrys sold, I wouldn’t be surprised if they’re profitable even with almost $4000 on the hood.
Yes
Thanks, all.
Toyota and Nissan have been aggressive with incentives on their sedans, in part, subsidized by the greater margins on their light trucks as they are the 2 Asian automakers with the largest light truck lineups.
There were those denying that Toyota was putting that much $$ on the hood to move the Camry (in addition to fleet sales).
Toyota is more interested in profit than keeping the Camry at the top. If the RAV4 becomes more profitable – which already seems to be the case – the Camry won’t be propped up forever at all costs in a shrinking segment.
Besides, 82% of mid-size car buyers *don’t* choose a Camry.
If they are more interested in profit, why the incentives and fleet sales? I think it’s clear they are interested in market share and volume at the expense of profit. The lack of development of the engine/chassis speaks to them controlling costs to achieve that goal, but the goal is still the same.
Toyota is projecting an operating profit of $15 billion+ this year so they’re going to be fine even if they sell a few cars to rental companies and have to ratchet up the incentives even further. They’re a long way from becoming the New GM.
A few? Don’t kid yourself.
Toyota makes such profit because they are selling a 14 year old car with a revised body. That, and its SUVs/trucks.
But, only stupid American car makers sell cars to fleets and use trucks/SUVs to keep the lights on, right?
I agree, sporty, the facts seem to suggest that Toyota is indeed more focused on keeping the title than they are on profit-per-unit.
Didn’t end well for the Taurus in the 90s when Ford did nearly the same thing, but Toyota is coasting on reputation which is propping up residual values. That won’t last forever.
No their level of incentives, low lease pricing and heavy advertising show that Toyota is willing to do pretty much what ever it takes to maintain that sales crown. Combine that with the fact that they are now to the point where they are selling badge jobs and joint development cars shows why I call them the new GM.
+1 to SportyAccordy and ScoutDude.
What is this Old GM?
Forget profit, we’ll make up with volume.
Yea I should say that Toyota is the New “Old GM”.
In some ways yes, they are the ‘old GM’. But they do have the whole good product with a loyal owner base thing going for them too which covers up a lot of accounting mistakes. Old GM really did not have that piece of the pie
@87 Morgan – And so did old GM until about 1985 or so.
Surprising. I recently had the unfortunate pleasure of driving a 2015 SE for a week. I liked nothing about it, neither did my wife. It did everything, but nothing well.
Having driven the 2016 Accord, hands down better interior, fit finish and ride.
I feel like the Camry has gotten worse, my family members having owned variants since 2000. It just feels cheap and plasticky, ok ride and loud on the Highway
The Camry (and Corolla) desperately needs a complete from the ground up overhaul, with no carryover from past generations. They are perfectly acceptable cars, and unlike most other car enthusiasts I don’t even find them ugly, but at this point Toyota is just coasting on the Camry/Corolla’s favorable reputations, and is too afraid of radical changes lest they alienate their customer base.
People expect the next Camry to move to the TNGA platform.
contrasting a 2000 camry to a 2015 camry is laughable.
Okay, how about a 2002 and a 2015? Remove the “all-new bold” styling and its the same car, only with cheaper materials.
It is not the same as the 5th gen 2002 model.
See my reply above. Long story short, yes it is. Same old K platform that underpinned the 02-06 cars. Even the sheetmetal of the C-pillar is unchanged.
Maybe I wasn’t clear, I meant my family has owned Camrys since 2000 MY (to include 2003 solara. My parecurrently own a 09 Camry Hybrid which currently has almost 300k miles. Yup almost 300k miles.
I’ve tried to like the current Camry find a lot of faults. It’s clear the interior bits get cheaper and cheaper and to me it shows. My wife who doesn’t care as much for cars also detests the Camry. I think Honda doesn’t cheapen out on the interior and it shows.
I’m currently driving a 16 Charger Scatpack and have owned different LX platform variants (05 300c, 08 Charger). I’d take those old interiors over the new Camry interior haha.
Honda absolutely cheapens interiors and it does show. The materials in the Accord are no nicer than the Camry and nowhere near segment leadership. I spent time in each within 15 minutes of each other and it’s the same type of midgrade stuff in both. There’s no real difference. Sit in a Fusion or Passat afterward if you want to see a quality difference.
The 2009 Camry your parents have may be mechanically reliable but represents the absolute low point of interior quality for the Camry. My Mom had a 2010. The 2015 is far better, even if that only means “average”.
Ask one of the commenters here (Aija?) about the interior integrity of his Charger.
This is the first I’ve heard of someone complaining about a Camry being loud on the highway. Did it have really worn out tires or something?
I found the last Camry I drove in 2014 or so to be very loud as well. The interior had a cheap plastic feeling to it but the body felt extremely solid and rigid and it seemed like the road noise bounced off the nasty interior plastics.
“Unfortunate pleasure” is a great turn of phrase.
Camry wasn’t on my radar until I saw the incentives, and this was 2 years ago.
I am really not a Camry person, but….
Almost $5K off sticker and 0% financing for 60 months. Camry SE V6 for $25K.
The interior is not great, but it has the best powertrain you can get in a $25K family car.
Since then CAFE has killed the SE V6, the V6 is now a $4,500 option only available on the XSE/XLE which puts you upwards of $30,000 out the door in the real world.
For which you could still have any number of nicer cars starting with the Avalon in the same showroom.
How did CAFE kill the SE V6?
I wouldn’t think Camry SE V6 sales would move the needle on their CAFE #s.
Yes, the Camry SE V6, is dead, killed by CAFE! Evil guvmint!
Oh, wait a minute. It’s now called the XSE instead of the SE.
It must be the government’s fault that Toyota wants to make some money on it.
Competition is part of the auto business model. Upholding a #1 position burnishes the corporate image in the market. As well as keeping competitors at a distance.
Even in a decreasing mid size sedan segment, being #1 is important to Toyota, and if takes additional incentives, and more dynamic pricing to uphold the position so be it.
Perhaps they are diverting marketing funds towards incentives. Marketing moves iron, and incentives move iron.
Similar to the Civic in Canada, Honda will do anything to keep it #1, although this year its easier with the new model.
Same with the F 150, Ford will protect its #1 position.
Hmmm…well, then – maybe Toyota could try spending an absolute ton of money in order to make its segment entry into a class-leading vehicle, like Ford did with the F150…?
We just had a choice of a lower-trim Sonata and a lower-trim Camry at the local Enterprise lot, for my wife to take a trip from Western New York to Maryland and back. Sixty seconds spent in the cabin of each model, with the rental agent, was enough to solidify our choice of the Sonata…
In your case you or your wife preferred the Sonata, another individual would have preferred the Camry. In the US there are more folks that prefer a Camry to a Sonata.
YTD July there were 125,044 Sonatas and 233,882 Camry sold. BTW the Accord is at 201,300 with an increase in sales this year. While the new Malibu is disrupting the segment.
As for throwing money on a Tundra, the F150 is so far ahead it would be futile.
Honda is fonda pointing out that in something like 19 of the last 20 years the Accord has outsold the Camry, retail.
That means in 95% of the last 20 years more people in the US have preferred the Accord over the Camry.
And in accord w/ Hemi above, I aslo rented a Camry SE and was shocked at what a poor vehicle it was. Not in any way is it a class leader unless it’s KMart class.
Not a lot to crow about. The number of retail customers is close enough between the two that Tim Cain speculated recently that removing Accord coupe sales would probably put the Camry back in a slight retail lead. Big whoop.
In the iteration most people buy them–4cyl, auto–the Accord is every bit a boring cost-conscious appliance. It’s only when you start looking at the manual and V6 that things start to get interesting.
Toyota’s capacity to build the Camry in NA is about the same as Hyundai’s entire NA production capacity.
Together, the Sonata and Optima get close to the Camry’s nos.
As for the Accord, most reviewers have found it to be devoid of the cost-cutting found in the interior of the Camry – and whereas the Accord has been able to keep itself among the leaders in the segment when it comes to average transaction price, the Camry has dropped to towards the bottom.
“Sixty seconds spent in the cabin of each model, with the rental agent, was enough to solidify our choice of the Sonata…”
Not sure why, I’d say the ’15+ Camry interior is far and away better put together and nicer feeling than the 14+ Sonata’s. I will give the Sonata the edge in front seat comfort, however.
Having recently rented a new Sonata and driven a new Camry, I’d take the Camry in a heart-beat, even if I didn’t have to sit in the back seat. The Sonata’s has limo-style legroom combined with Ford Pinto hatchback headroom. I guess there’s no CAFE MPG break for useful space, just for taking up space. The Sonata didn’t have any other glaring faults besides its inadequate drivetrain(are their HP as real as their MPG?), but the Camry was a convincing refutation of the marketing myths about its mediocrity. You’d need to be a pretty big hand puppet to compare one side by side with most of its competition and not think it deserves to tower over the others in sales. The only exception is the Accord, which has better moves and comparable quality.
“but the Camry was a convincing refutation of the marketing myths about its mediocrity. You’d need to be a pretty big hand puppet to compare one side by side with most of its competition and not think it deserves to tower over the others in sales”
OK, you do write better than Car and Driver :)
I could see $3700 off on the hybrid or XSE V6 being appealing.
I just don’t get the point. There has to be some kind of break even point that yields more profit at the expense of volume. Does the Camry being America’s #1 selling car really factor into anyone’s buying decisions?
For some it’s the “ONLY” factor in the buying decision.
For all the hyped up new school methods of advertising, good ol fashioned word of mouth still matters. Knowing Aunt Shirlie and Uncle Ed and half your coworkers own Camrys and haven’t had any problems between them is an exponentially more potent endorsement then a pile of JD Power awards.
It’s an odd mindset for us enthusiasts, but to the Average Joe anything associated with changing cars is a royal pain in the rear. Sure we weirdos LIKE driving, but to the rest of the first world driving is that boring thing you do between the fun stuff in life. “Vehicle, 4 door with Engine” suits the masses just fine. And even enthusiasts may see the value in owning a boring appliance for daily commuting , versus using an enthusiast vehicle totally unsuited for it .
Like a manual transmission S2000, or a V8 F-car that shakes when the driver so much as thinks about expansion joints.
There’s also the economies of scale associated with producing more widgets than the other guy, helping profitability and/or competitiveness.
Profit margins matter, of course, but as long as you’re selling more cars, you’re also bringing in more revenue that’ll keep the lights on, pay for marketing, tooling, development, and any other fixed costs.
The Camry is in the same order of magnitude in volume as its competition… the couple dozen thousand more units it’s selling a year don’t unlock it to economies of scale that justify the incentives and fleet losses. Camry may be the top seller but I’m doubting it’s the most profitable in its segment.
In order to maximize profits, need to keep the factories running at capacity, if not over capacity.
If you pile enough cash in front of it, you can’t see that hideous mug.
I just had a week in a brand new one. An “upgrade” from the Jetta I reserved – thanks Hertz… A steaming pile of meh. They should all be white on black with a barcode badge that decodes as “car”.
I feel like the Jetta is a just as big pile of meh.. just one with what’ll probably be a way worse ownership experience.
German=Superior.
Opinions are like anuses, everyone has one and they usually stink. To each his own. I prefer a car that drives properly and doesn’t feel like it was built by Fisher-Price. Even the cheapest German cars have that Autobahn DNA in them, feeling like they are intended to be driven 110mph all day every day. Japanese cars feel like they are intended to sit in Tokyo traffic all day every day.
@ToddAtlasF1
German does = superior in the things I care enough to spend my money on when it comes to cars. In the past, I found Swedish to be an adequate substitute for a lot less money, but I can afford the real thing now. Though I prefer my trucks to be British.
“Opinions are like anuses, everyone has one and they usually stink.”
Yours is also noisy.
“Yours is also noisy.”
You’re my favorite Floridian!
Autobahn DNA? These days, that’s like I-80 (west of Omaha) DNA. Most Japanese cars sold in the US have no relation to their brand mates sold or designed in Japan. Don’t be so blind.
West German cars were drove fantastically relative to their contemporaries. German cars are built for the Chinese, who are often as sophisticated in their automotive tastes as any first time car owners. Somehow you missed the change.
Everyone who “had one as a rental” for a week had a 4 cylinder.
It’s a different car with the V6. 90 extra horsepower and the refinement of a V6 used in Lexus vehicles fundamentally changes the Camry.
You could also characterize the Lexus ES350 as having a V6 used in Toyota vehicles, right?
Yeah, you could, and having a Toyota V6 isn’t a bad thing.
Point is, it is a workhorse engine for Lexus, it goes in their highest volume models. It’s definitely good enough for Lexus.
I’m very happy with the 3.5 V6 even in the heavier Highlander. If you get aggressive pulling out to pass someone you can hit 100 mph pretty quickly.
You could characterize the Lotus Evora that way, too.
What you can’t do is characterize the Sonata as having a V6 used in anything at all.
No it’s not. It’s just a *faster* wallowing, ill-steering, cheaply made appliance with lousy seats.
And I have rented several V6 Camrys over the years. It’s a nice engine that deserves to be in something better than a Camry. Though I’d still take any inline 6 over it any day.
“It’s just a…wallowing, ill-steering, cheaply made appliance with lousy seats.”
Yep, describes our Camry to a T.
Then you bought the wrong one
https://www.thetruthaboutcars.com/2013/05/review-toyota-camry-se-2-5l-track-tested/
You are full of it.
No one on earth has rented “several” Camry V6s.
I’ve rented every model of Camry from absolute abject rental spec to Hybrid to leather-lined V6 from Hertz over the years. I rent 30-40+ cars a year in my work travels. Toyota sells a LOT of Camrys to the rental agencies, in all trim levels. Not that there is anything wrong with that, a sale is a sale.
And they all sucked.
This is why automakers should also report average transaction prices along with sales numbers. It’s pretty meaningless for the Camry to be #1 and the Fusion to be #2 if people are paying thousands more for the Ford. Anyone will buy anything as long as it’s cheap enough. Seems as if most Camrys and Corollas that I see on the road today are either low-spec models or fleet vehicles. While I see tons of high-spec “Titanium” Fusions and Focus on the road. Obviously that’s just my personal perception, but that’s why I’d like to see the sales numbers presented this way.
The automakers are never going to release the ATP for their vehicles. For one they don’t want the consumer to have that as a negotiating point. I think it would have been nice if the incentive levels for at least the rest of the segment, or at least the relevant players would have been included in the article.
You are not the only one that sees a lot of the Fusions in that Titanium trim though I can’t say I’ve noticed many Focus in that trim level.
From a few years ago, when the current Camry was still relatively new, it had the second lowest ATP in the segment (after the now departed Dodge Avenger).
I don’t see many current Fusions at all, nor do I see where they feature in the best selling sedan race. Camry>AccordAltima are the top three.
The fusion was just an example because I was looking at one when I responded. I don’t know where the Fusion ranks. All I do know is that the latest generation Fusion has been a huge success for Ford.
A few years ago, the Fusion was among the tops in ATP, many months beating the Accord.
As a sedan Camry’s one of the healthiest lepers.
(hissssssssssssssssssssss)
What is that sound? Is the new car bubble about to burst, or did it just spring a leak?
It’s about to burst.
Just imagine how Mazda feels, seeing that Toyota needs to increase their incentives on Camrys. The incentives game is going to hurt the small players the worst.
Ask Nash, Hudson, Studebaker and Kaiser what happened when Ford and Chevrolet went after each other in 1954.
The biggest problem Mazda has had for years is its inability to match cash incentives and subsidized leases of Toyota, Honda, Hyundai and the rest of the bigger players.
Exactly. Mazda is not and cannot give $5K off their vehicles. In part because a lot of them are made in Japan.
From publications like Forbes their ATP’s are increasing though, so as others have mentioned volume alone doesn`t tell you the whole story.
Buyers are more willing to pay a premium for Mazda in other markets (Canada, Europe, Australia).
For me it will take big discounts and zero apr. These cars look and feel cheap. Maybe the 2018 will be better…
The incentives are up by $500? or $700? That’s $20/month on a 36 month lease. Not a game changer for most people. I don’t see how that is going to change a lot of minds.
This is the last year before a redesign, so they deserve a discount.
So, does anybody have the nerve to come out and verbalize Toyota’s popular old tagline “I love what you do for me…Toyota!” Anybody? Bueller? OK, got nothing as I’ve never driven a Toyota.
But, apparently if given enough of a discount on a rather bland, average sedan with a decent and long-standing reputation for quality and reliability, people will bite. In comparison, my experience in driving a late-model Accord sedan is that the Earth Dreams 4-cylinder coupled to the most refined CVT on the market make for a pleasant and enjoyable driving experience. In some respects, I get what it is that has kept the Accord on Car & Driver’s 10 Best list for so many years; yet, at the same time C & D have seemingly ignored some of Accord’s minor flaws and/or failings as it fails to be the perfect car. Hint: the seats are less than ideal. As has been said many times, YMMV.