Toyota Motor Co., the world’s largest automaker, has been producing cars for more than 70 years. It wasn’t until after World War II, however, that production started to pick up. Toyota went from making 8,500 cars a year in 1955 to 600,000 in 1965. Models like the Toyopet and Land Cruiser hit the United States in 1957. Today Toyota is among the leaders when it comes to hybrid technology.
CBS’ Marketwatch reports from Tokyo (or more accurately, blogs the Japanese Business Daily Nikkei’s reporting) that Toyota is going to change out accelerator pedals in US market vehicles in hopes of putting the issue behind them. “Toyota Motor Corp. will make changes to gas pedals in certain U.S. models under an agreement with the U.S. National Highway Traffic Safety Administration, according to a published report, in response to accidents blamed on the accelerators getting stuck to the floor mats. Toyota still maintains that the vehicles are not actually defective. But to settle the potentially image-damaging issue, it will change the gas pedals so they are less likely to get stuck. The work will be handled through dealerships, Japanese business daily Nikkei reported Saturday.” Interestingly enough, nothing is said about non-US market vehicles. Read More >
We weren’t the only outlet to note Volkswagen’s apparent 2010 production volume win over Toyota a few days ago. Not so fast, Toyota tells Automotive News [sub]. Volkswagen’s total included production by joint ventures in which it does not hold a majority stake, Toyota’s didn’t. On an apples-to-apples basis (with minority stake affiliates included) Toyota built 4.9m vehicles in the first three quarters of 2009, to Volkswagen’s 4.4m. And because Toyota cut so much production early this year, while VW rode the European (particularly the German) cash-for-clunker wave, Toyota will continue to gain ground over the rest of the year. And the gap could widen in 2010: VW should see a certain amount of downturn in its core German market now that the abwrackprämie has expired, while improvements in the US and Asian markets should help Toyota. Not that Toyota cares about being number one. “Toyota’s goal is to focus on the customer, so we’re not focused on being No. 1,” ooze the spokesfolks. Well thanks for correcting us anyway.
Not long after Fortune’s long time auto writer Alex Taylor III finished his apology to Ford he went on to write a love letter to Sergio Marchionne. Taylor starts with parallels to Ghosn’s myth making success at Nissan, then ups the ante: “The other day in Auburn Hills, Mich., Fiat CEO Sergio Marchionne took a page out of the Ghosn playbook — and then improved upon it.” The impetus for Taylor’s piece was the legendary Power Point Rumble in the Detroit Jungle TTAC’s Edward Niedermeyer reported on with, um, slightly less enthusiasm last week .
Reuters reports that Japanese manufacturers are running scared from Hyundai-Kia. A combination of a rising Yen and South Korea sealing more and more free trade agreements with other countries has helped Hyundai-Kia immensely. Of course, copying Toyota’s business model of building reliable cars at affordable prices has helped greatly, too. All this momentum from South Korea is getting Japanese car executives a little bit nervous. “I think there’s a sense of crisis in the whole (Japanese) industry,” Toshiyuki Shiga, chief operating officer at Nissan Motor. “Whether you take the Free Trade Agreements or foreign exchange policy, I get the impression that South Korea is tackling things well.”
US sales of the not very Smart car have fallen off a cliff. The Financial Times reports that “Smart sold only 661 of its fortwo model in the US last month, more than two-thirds below October 2008 and the lowest for any month since the car made its debut in the US early last year.” Other analysts are blaming low fuel costs and the foolishness of US consumers who just don’t get the appeal of microcars. Not me, I blame the fact that the Smart car is an all around underwhelming vehicle which gives up too much capability in return for mediocre fuel economy. Note that the Smart brand is a failure in Europe as well. “Daimler’s decision to export Smart to the US was a critical part of its rescue plan for the brand. For all its pizzazz, the little car has been a financial millstone. Daimler came close to shutting down the brand in 2006, but opted instead for a €1bn ($1.5bn) restructuring aimed at making the business profitable by the end of 2007.” How anyone (let alone Roger Penske) thought a failed European microcar would be saved by exports to the US is beyond me. Smart’s new “Value Days” 1.9% financing promotion isn’t going to get the job done. Not even a Toyota-esque Saved By Zero campaign would do the trick.
You need to go to your toughest market. The state of California is the biggest nut to crack for Buick. Californians love their Toyotas, they love their luxury cars, their BMWs and their Priuses, Buick is not even on their radar screen. These people don’t know this Regal. Picking the L.A. Auto Show demonstrates some confidence we have in the product and in the brand.
So says GM’s Susan Docherty in the Detroit News. Of course, it also shows how screwed the Buick brand is. California on its own is one of the largest markets for cars in the world, and it’s also home to some of the most virulently anti-domestic-brand sentiment in the country. Which explains why Buick is trying to win over the Golden State with its first-ever imported model. But as Docherty says, “One car doesn’t transform a brand. You have to have a series of successes so one, plus one, plus one equals more than three.” Meanwhile, while Buick tries to convince Californians that they don’t actually want a Lexus, everyone who thought they knew and loved the Buick brand will just be confused.
With Tata unable to produce enough Nanos to keep up with demand, more automakers are gunning for its entry-level segment. Renault-Nissan is teaming up with its Indian-market partner Bajaj to produce a car that’s even cheaper to produce than the Nano. “I can tell you the cost of this car would be lower than any car today made in India,” Renault-Nissan CEO Carlos Ghosn tells Gasgoo, adding that a lower production cost wouldn’t guarantee that the new car would be priced lower than Nano. The Renault ULC, as the low-cost car is being called during development, will be available in India in 2012, by which time GM and Toyota could have competing models on the market. Ford’s recently-announced Indian market low-cost car, based on the discontinued previous-generation European Fiesta, will be positioned above the Nano. And that strategy also appeals to Honda. The Motor Company tells the WSJ that rather than competing directly with the lowest-cost segment, a sub-Fit (Jazz, as it’s known globally) hatchback will be introduced around 2012 to compete with Ford’s model. The Jazz/Fit currently sells for about $15,000 in India, leaving a huge window between there and the Nano’s approximately $3,000 price price tag.
Although Toyota was a 50% stakeholder in the NUMMI facility in Freemont, California, it may end up carrying 100% of the closure costs. The LA Times reports that Liquidation Motors, the company which took over GM’s assets won’t fund any of the severance pay or other expenses to the closure of NUMMI. “Motors Liquidation is not contributing at all” (to the closure costs), said Tim Yost, a spokesman for Detroit-based Motors Liquidation Corp., “We don’t believe there will be a requirement for us to do so.” Paul Nolasco, a Toyota spokesperson in Tokyo said that “Although we cannot provide any figures at this time, it is something for which we plan to make allowance in our earnings report.” Toyota was planning for a smaller-than-expected loss for this financial year, and the addition of these extra costs (should they happen) will affect the company and its stock price. On the other hand, it also puts Toyota in the exact same boat as the American taxpayers.
In tune with the times, automakers are making their vehicles easier to recycle. But is this effort making the vehicles less durable? Look at the designs Toyota put into the Prius to make it easy to dismantle for recycling (to comply with the Japanese recyclability laws). Wiring connections that come loose when you pull on them? Soundproofing held in place with a few “ultrasonic spot welds” instead of glue? Reading lights secured with bent metal clips instead of screws? Instrument panels made so they can be pulled out easily? With design features like this you have to wonder about the vehicles’ durability and wonder what other manufactures are doing—-especially when you combine “easy to disassemble” with the beancounters’ mantra of “cheap to build.”
The Guardian reports that in the first 9 months of 2009, Volkswagen/Porsche made 4.4 million cars whereas Toyota made 4 million. Naturally, the majority of VW’s growth has come from the area which is growing even faster than VW, China. But the lads from the Middle Kingdom weren’t the only modes of growth for Volkswagen. The Wolfsburg warriors were also beneficiaries of European stimulus packages (A.K.A: Cash for Clunkers) where Volkswagen have large market share (Germany, UK, etc). Charity really does begin at home! Read More >
Sajeev, today in a parking lot I was approaching a new Toyota Avalon from the side and at first thought I was seeing a recent Chrysler product. It had the bottom of the window about shoulder high to the passengers and the windows seemed rather short. As I walked through the lot I saw that many of the newer cars had that same look. When I was a child it was called “chopped” and seemed to be a favorite way to customize post war Buicks. It went away until the early millennial Chrysler products (300 series as an example) and I hear it referred to as the “thug” look. The look now seems to be expanding across many manufactures’ lines. Why is this? Fashion, safety, or efficiency? Wikipedia says it started in the late 40’s with Salt Flat racers to reduce aerodynamic drag by lowering the car’s profile. It then became popular as a Kustomizing look. I have not spent any time in these vehicles. How is the outward visibility? Do you have information or an opinion on this subject? Read More >
Look at this car and what do you see: Eleanor, star of the original 1974 “Gone in 60 Seconds” movie? All the worst excess and ugliness of the early seventies folded up into one bloated pile? A long stripe of black rubber burned into a country road? The destruction of an American icon? Nostalgia for a simpler and more innocent time? Nothing at all, if you’re trying to look out the back window? Put me down for all of the above, as well as a couple of lasting lessons this Mustang taught me.
At the upcoming 2009 Guangzhou auto show, Volkswagen China is expected to announce that they will build a plant in southern China, Gasgoo writes, citing reports in sohu.com. Not much else is revealed, not even which of their two Chinese joint venture partners will get the new plant.
Volkswagen cooperates with two companies in China: FAW, based in Changchun in the North, and SAIC, based in Shanghai in East China. Both are bitter rivals. Read More >
Intellectual property warriors, get your guns: Following GM, its arch nemesis Toyota will plant a brand new R & D center smack into the alleged intellectual property jungle called China. Toyota plans to spend between $330 and $440 million for the center. Building will commence next year. Compared to Toyota, the one GM built in 2008 was the lite version at a price of only $250 million.
The Toyota R&D center, complete with a full-scale test course, will be located not far from the GM center, in the outskirts of Shanghai, Gasgoo reports. Read More >
Look at Chrysler’s sales volume by model, and it’s clear that Ram is one of the few nameplates keeping Chrysler’s volume moving. Especially when you consider that pickups typically generate far more profit than car and crossover models. Which brings us to what may have been the most penetrating question of Wednesday’s question-and-answer period (which didn’t come from a journalist, but from investment bank Goldman Sachs). Namely: how does a retraction in the truck market would affect the linear relationship between volume and profit exhibited in Chrysler’s financial plan graphs? Oh yes, and what were Chrysler’s planning projections for energy costs? The answer was that every five percent shift from trucks to compact or mid-sized vehicles would result in a half-billion dollar reduction in EBITDA. Though the CFO added that in the future Chrysler would be better able to capture that shifting market, due to better offerings in the compact and mid-size segments, Marchionne made it clear that any losses in the truck market would be mitigated at best. Marchionne joked that his team would need a Ouija board to forecast energy prices, but the reply was that assumptions in the plan were for gas to be “somewhere in the $4 range.”
Recent Comments