At Motoring Weekly, we have written many articles about vehicle production and the rise and fall of the numbers as particular vehicles go in and out of favour with the buying public and fleets. Often those decisions are driven by tax or other Government policy changes.
We know that in the US, buyers are heading back to SUVs and trucks as the price of fuel settles down – remember back ten years ago when trucks were out because of the huge increases in the price of oil that was filtering down to consumers as ever increasingly expensive fill-ups at the pump.
With Ford and General Motors pretty much giving up on building passenger cars in the US with some models coming from Asia and Mexico, we are seeing others change their model line-up. FIAT Chrysler has focused the small cars on Europe with FIAT and Alfa Romeo underpinning some of the more recent Dodge cars before they went to pure performance (where they should be) and Chrysler focused on making SUVs. That leaves the smaller vehicles to be marketing by FIAT and Alfa Romeo – although these are premium family vehicles.
So that leaves the “regular” sedan market in the US to the Japanese, Koreans and now Chinese manufacturers. With that in mind, Toyota is looking at its model range for the US market. They have stated that they do not want to get rid of all their sedans because they are still marketable – especially the Camry. They will look at the competition and decide whether they want to get into a price war, because that is really the only main competitive driver for vehicles such as the Yaris and some Prius models. It is funny how people want to buy an expensive pure electric car yet won’t buy a cheaper hybrid and that must be because the numbers don’t stack up.
With the Big Three abandoning the cheaper end of the large vehicle market, it gives Toyota something to think about with regards to their Avalon model. Do they keep it and try and take that market segment or do they spend their cash on bolstering sales of the RAV4 SUV and smaller trucks that are built locally in the US. We suspect that the Avalon will go, it is a nondescript vehicle in a nondescript market segment and Toyota will be beaten by the Koreans and Chinese who have learnt a lot from how Toyota, Honda and Mazda grew in the US market. Even Hyundai is considering getting out of this segment!
With buyer sentiment focused on SUVs and light trucks, it is likely that Toyota will move their cash into those segments – trucks especially are highly profitable at the moment, however saying that, it only takes one tweet from the White House to mess that up! Perhaps Toyota could make the Crown Super Deluxe taxi a hybrid or electric and sell them into the major cities or to Uber, Lyft et al.