As gas hovers around $4 gallon, you'd think that with its lineup of fuel-efficient hybrids Toyota would be flying high. And while Camrys and Corollas are selling well and dealers are moving every example of the gas-sipping Prius they can find, the automaker's overall sales were actually down 11.9% last month, and profits are off 38.9% for the year. So what's the problem? Basically, a serious case of bad timing -- just when it decided to finally take on Detroit with a full-size pickup, the market collapsed and Tundra sales plummeted 42% in July. But while the Detroit Three are racing to dump SUVs for fuel-efficient cars, at least one Toyota executive believes these market changes are temporary, and eventually pickup sales will be just fine.
While full-size pickup sales are expected to total just 1.45 million this year (down from 2.14 million in 2007), the Toyota Division's general manager at Toyota Sales U.S.A. Robert Carter believes that people are getting worked up over a temporary problem. Saying "we are absolutely confident that the recovery will take place, it's just arguable when," he explains that pickups will always make up a large part of U.S. sales since "the core buyer who uses the truck for employment" can't exactly downsize to a Yaris, no matter how expensive gas gets. Carter does admit that the automaker isn't as sure weekend warriors will still use a Tundra for towing boats or trips to Home Depot, but claims those owners have never been a core part of the full-size pickup market anyway.
Carter adds that despite having faith in pickups, it's Toyota's "intention to build to the market," and the company is slashing production in light of falling demand. Employees at its San Antonio, Texas, plant that builds the Tundra have been temporarily moved to other factories, and the automaker is building more cars as fast as it can. When it comes to the ever-popular Prius, Carter says Toyota has "sold the inventories down to nearly zero" and is "restricted on capacity and components," preventing it from increasing production until a new plant in Mississippi comes online.
Considering that Toyota built an all-new factory in the heart of truck country and spent millions promoting its new full-size pickup, the Tundra's slow sales have been a major blow to the world's largest automaker. But Toyota's Detroit competitors are stuck in the same situation with their own pickups, and unlike them the company has a brand new Prius due out next year that should help keep profits up until truck sales recover.
Source: Automotive News (Subscription required)