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Toyota: Style overhaul to help market shares
TOYOTA Motor Corp's small sedan revealed last week in Detroit is the most important model the company will never sell. Called Furia, it gives a hint of what Akio Toyoda wants from a company not known for its style.
Toyota teased out a video and rear quarter-panel shot of Furia showing little more than a stylized knife-shaped LED taillight prior to the North American International Auto Show. While Furia itself isn't headed to dealerships, elements of it will show up on a revamped Corolla, the company's global best-seller, due this year.
Toyoda, 56, became chief executive officer in June 2009 after the company reported its first fiscal-year loss in 59 years. Soon, he faced charges of unintended acceleration that led to recalls of millions of vehicles around the world. To steer the company out of the quality crises and through the March 2011 tsunami, he pushed a return to the manufacturing basics that established Toyota's reputation. Now, he wants to go beyond that to secure profitable sales gains into the future.
"What's not to like about the job Akio Toyoda has done?" said Jim Womack, author of "The Machine That Changed The World," an influential study of Toyota's production techniques. "The real test for Akio is the future: Can he take them up another peg?"
Seeking an unprecedented 10 million annual sales, Toyoda faces a world of challenges, from those he can't do much about, such as the strong yen, to those he can, such as competition from South Korea's Hyundai Motor Co and changing Toyota's reputation for boring cars. Making better-looking cars can protect profit margins now and win new customers into the future.
Family scion
The Toyoda family scion is a car enthusiast who "wants the design to match the driving dynamics of the car," said Mark Templin, who oversees global marketing for the Toyota's Lexus brand and runs that unit in the US. "He's also not changing the culture of what we stand for."
Toyoda knows quality is the cornerstone of the company. He's a CEO so steeped in company lore he can operate the automatic loom his great grandfather developed that began a family fixation with defect-free output. At the same time, he knows quality is no longer enough. He insists on testing each new model to make sure it's fun to drive and looks just as good.
When Toyoda took control of the carmaker his grandfather founded in 1937, the company was reeling from its biggest annual loss and downgrades from Moody's and Standard & Poor's Ratings Services highest credit ratings. The global recession triggered a 35 percent contraction in US auto demand, Toyota's largest market.
Then came a deadly traffic accident in late 2009 that killed a California Highway Patrol officer and three family members after a loose floor mat in the Lexus loaned to him by a dealer jammed the gas pedal. The incident spurred 10 million recalls over the next year, rattling the company's reputation. Accusations arose almost daily and Toyoda flew to Washington to testify.
'Personal committment'
"My name is on the company," he told the House Oversight and Government Reform Committee on Feb. 24, 2010. "You have my personal commitment that Toyota will work vigorously and unceasingly to restore the trust of our customers."
With the recession receding, natural disasters sparing the automotive supply chain and the addition of new products, Toyota delivered a big rebound in 2012.
It sped back ahead of GM in first quarter sales and never let up, winning the first three quarters. Toyota now expects to report 9.7 million vehicle deliveries worldwide for the year, the most in company history. That easily tops the 9.2 million vehicles GM said it sold last year and VW's 9.07 million. Toyota looks ahead to selling an unprecedented 10 million autos annually by mid-decade.
Demand for the revamped Camry, which remained the best-selling US car for the 11th year in a row in 2012, and the expanded line of Prius hybrids in the US pushed Toyota's volume back above the 2 million-unit level last year for the first time since 2008.
"They've not only regained most of the market share lost, but at a much faster pace than we thought," said Jesse Toprak, industry analsyt for TrueCar.com, an auto pricing and data service provider.
Toyoda ties his advocacy of strong design and performance for Toyota vehicles to his personal passion for driving.
"I love cars as much as anyone," Toyoda told House members in his 2010 testimony. He has blogged about his experiences driving in a 24-hour race in Germany.
His push for more desirable cars has included threats to kill products he deemed insufficiently exciting. That included the company's Lexus GS sport sedan.
While Toyota has thrived on a reputation for durability, fuel efficiency and value, Toyoda has said its hallmarks must include design and performance.
"Those are the right directions for Toyota - and by the way, for every other carmaker," said Eric Noble, president of the Car Lab, an industry researcher and consultant in Orange, California. "The challenge isn't knowing where you want to go. The challenge is knowing how long the hike will be to get there."
The new Avalon sedan Toyota added in late 2012 moved further in the design-oriented direction Toyoda desires.
The large sedan designed in California, engineered in Michigan and built in Kentucky, is a "bold departure from the current path," both in terms of styling and US development, said Kevin Hunter, president of the carmaker's US studio.
Its leaner chassis and new grille, similar to Ford's new Fusion midsize sedan, shifts away from the previous Avalon's more bulbous profile.
Toyota wants a 30 percent gain in Avalon sales this year from the new model and to cut the average buyer's age to the mid-50s, from 65 for the previous version.
"Is Avalon a perfect product? No," Noble said. "Is it a far more interesting product than previous Avalons, and was more of it done in the market it was planned for - North America? The answers are yes and yes."
Other models embodying Toyoda's styling and performance push include the Scion brand's rear-wheel-drive FR-S sports coupe, which Lentz says remains in short supply, and the new Lexus ES sedan released in 2012.
Design ethos
With GM, Ford, Hyundai and Volkswagen all targeting bigger shares of global auto sales, Toyoda can't rest on the 2012 rebound.
As a so-called concept car, the Furia is meant as a mind-expanding engineering exercise and won't be produced commercially. Still, the reception of the Furia, the new IS and restyled Corolla due in 2013 are critical indicators for Toyoda's strategy.
Toyota seems to fully recognize products have to connect at more than just a rational level with customers, Noble said.
Toyota teased out a video and rear quarter-panel shot of Furia showing little more than a stylized knife-shaped LED taillight prior to the North American International Auto Show. While Furia itself isn't headed to dealerships, elements of it will show up on a revamped Corolla, the company's global best-seller, due this year.
Toyoda, 56, became chief executive officer in June 2009 after the company reported its first fiscal-year loss in 59 years. Soon, he faced charges of unintended acceleration that led to recalls of millions of vehicles around the world. To steer the company out of the quality crises and through the March 2011 tsunami, he pushed a return to the manufacturing basics that established Toyota's reputation. Now, he wants to go beyond that to secure profitable sales gains into the future.
"What's not to like about the job Akio Toyoda has done?" said Jim Womack, author of "The Machine That Changed The World," an influential study of Toyota's production techniques. "The real test for Akio is the future: Can he take them up another peg?"
Seeking an unprecedented 10 million annual sales, Toyoda faces a world of challenges, from those he can't do much about, such as the strong yen, to those he can, such as competition from South Korea's Hyundai Motor Co and changing Toyota's reputation for boring cars. Making better-looking cars can protect profit margins now and win new customers into the future.
Family scion
The Toyoda family scion is a car enthusiast who "wants the design to match the driving dynamics of the car," said Mark Templin, who oversees global marketing for the Toyota's Lexus brand and runs that unit in the US. "He's also not changing the culture of what we stand for."
Toyoda knows quality is the cornerstone of the company. He's a CEO so steeped in company lore he can operate the automatic loom his great grandfather developed that began a family fixation with defect-free output. At the same time, he knows quality is no longer enough. He insists on testing each new model to make sure it's fun to drive and looks just as good.
When Toyoda took control of the carmaker his grandfather founded in 1937, the company was reeling from its biggest annual loss and downgrades from Moody's and Standard & Poor's Ratings Services highest credit ratings. The global recession triggered a 35 percent contraction in US auto demand, Toyota's largest market.
Then came a deadly traffic accident in late 2009 that killed a California Highway Patrol officer and three family members after a loose floor mat in the Lexus loaned to him by a dealer jammed the gas pedal. The incident spurred 10 million recalls over the next year, rattling the company's reputation. Accusations arose almost daily and Toyoda flew to Washington to testify.
'Personal committment'
"My name is on the company," he told the House Oversight and Government Reform Committee on Feb. 24, 2010. "You have my personal commitment that Toyota will work vigorously and unceasingly to restore the trust of our customers."
With the recession receding, natural disasters sparing the automotive supply chain and the addition of new products, Toyota delivered a big rebound in 2012.
It sped back ahead of GM in first quarter sales and never let up, winning the first three quarters. Toyota now expects to report 9.7 million vehicle deliveries worldwide for the year, the most in company history. That easily tops the 9.2 million vehicles GM said it sold last year and VW's 9.07 million. Toyota looks ahead to selling an unprecedented 10 million autos annually by mid-decade.
Demand for the revamped Camry, which remained the best-selling US car for the 11th year in a row in 2012, and the expanded line of Prius hybrids in the US pushed Toyota's volume back above the 2 million-unit level last year for the first time since 2008.
"They've not only regained most of the market share lost, but at a much faster pace than we thought," said Jesse Toprak, industry analsyt for TrueCar.com, an auto pricing and data service provider.
Toyoda ties his advocacy of strong design and performance for Toyota vehicles to his personal passion for driving.
"I love cars as much as anyone," Toyoda told House members in his 2010 testimony. He has blogged about his experiences driving in a 24-hour race in Germany.
His push for more desirable cars has included threats to kill products he deemed insufficiently exciting. That included the company's Lexus GS sport sedan.
While Toyota has thrived on a reputation for durability, fuel efficiency and value, Toyoda has said its hallmarks must include design and performance.
"Those are the right directions for Toyota - and by the way, for every other carmaker," said Eric Noble, president of the Car Lab, an industry researcher and consultant in Orange, California. "The challenge isn't knowing where you want to go. The challenge is knowing how long the hike will be to get there."
The new Avalon sedan Toyota added in late 2012 moved further in the design-oriented direction Toyoda desires.
The large sedan designed in California, engineered in Michigan and built in Kentucky, is a "bold departure from the current path," both in terms of styling and US development, said Kevin Hunter, president of the carmaker's US studio.
Its leaner chassis and new grille, similar to Ford's new Fusion midsize sedan, shifts away from the previous Avalon's more bulbous profile.
Toyota wants a 30 percent gain in Avalon sales this year from the new model and to cut the average buyer's age to the mid-50s, from 65 for the previous version.
"Is Avalon a perfect product? No," Noble said. "Is it a far more interesting product than previous Avalons, and was more of it done in the market it was planned for - North America? The answers are yes and yes."
Other models embodying Toyoda's styling and performance push include the Scion brand's rear-wheel-drive FR-S sports coupe, which Lentz says remains in short supply, and the new Lexus ES sedan released in 2012.
Design ethos
With GM, Ford, Hyundai and Volkswagen all targeting bigger shares of global auto sales, Toyoda can't rest on the 2012 rebound.
As a so-called concept car, the Furia is meant as a mind-expanding engineering exercise and won't be produced commercially. Still, the reception of the Furia, the new IS and restyled Corolla due in 2013 are critical indicators for Toyoda's strategy.
Toyota seems to fully recognize products have to connect at more than just a rational level with customers, Noble said.
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