It might be a bad day for GM but it’s a much worse one for Toyota. Really. The days (decades, really) of weak domestic manufacturers shooting themselves in the foot with bad design, poor assembly, and non-existent customer satisfaction in passenger cars are coming to an end. Toyota didn’t have to outrun the bear, it just had to stay ahead of GM, Ford, and Chrysler. Years of producing huge profits in North America hit the wall for Toyota in 2009, and they’re likely not to return. Ever. The game has now changed—and it’s not good for Toyota.
Thanks to US and Canadian taxpayer support, GM and Chrysler are about to get a new start. They’ll enjoy fresh balance sheets, with minimized legacy liabilities and serious money earmarked for new products. (The taxpayers are paying for Fiat to develop cars for North America; you didn’t really think that the Italians would take this risk on their own did you?) Ford, by dint of luck or smart management, borrowed what it needed years ago to make the transformation outside of court oversight.
By the end of this year, all three Detroit automakers will be restructured, resized to match production with demand, and re-energized. They will reenter the market as the lowest cost producers inside the U.S. market, with slimmer, trimmer product lines. These automakers are getting ever-closer to 100 percent capacity utilization.
Looking at product, Ford’s passenger car line up just keeps getting better. The 2010 Taurus looks hot, the Fiesta test drive campaign is generating good press with the Twitter/Facebook crowd, and a new Euro Focus will be here in a two years. Slowly but surely, more Americans are considering a Ford passenger vehicle. Its trucks still lead the category and will continue to do so. Better products, increasing quality, and slowly increasing market share is building FoMoCo momentum.
GM’s go forward brands—Chevrolet, Buick, GMC, and Cadillac—still have some vehicles that don’t cut the mustard with consumers. But the balance is starting to tip back towards the positive. The Malibu and Camaro represent some better efforts. The gorgeous new Buick Lacrosse might give the new Taurus a run for the money. Cadillac will extend the CTS line and bring a new SRX to the market shortly. The Corvette still leads the pack in dollar performance value. And maybe, just maybe, the Cruze and Viva will live up to GM hype machine.
GM’s perhaps two to three years behind Ford with its product development cycle. But it can now concentrate on fewer models. Recent successful launches suggest that GM just needs time to plug the holes for the weak sisters. It now has the money to do so and you can bet (if you’re taxpayer, you already have) that the efforts on fuel efficient passenger cars will receive the bulk of the dollar spend. GM won’t abandon trucks (no matter what Nancy Pelosi thinks) and volume wise, GM leads.
Chrysler can’t do anything under their new pasta-fed management until the re-tooled imports arrive here for production two years hence. Its cars still (mostly) suck, except for the higher-performance versions of its LX cars. But it isn’t going away and will still find some buyers for its products at the pace of the recent past. So this company will just hang on . . . and on . . . and on.
Now, stop and think about this. What has Toyota done for you lately? Is there one single passenger car from Toyota that excites you?
Let’s keep the new Prius out of this discussion for the moment; it’s not a car for drivers but techno-geeks and greens mostly with excitement provided by the fuel gauge, not vehicle dynamics. The Camry might lead the C/D class in sales for now, but will this continue? What happens when Americans actually consider a Malibu or Fusion-based product instead? In terms of design appeal, the Camry looks dowdy or boring (take your pick) and its reliability isn’t any better than the Fusion. Put a four-cylinder EcoBoost engine in that Fusion and Ford wins.
Go through the rest of Toyota’s passenger car line up and compare each vehicle to the current and near future offerings from GM and Ford. The question is: will Toyota customers do the same?
Toyota (or Honda) products have been the default choice. That “Easy Button” is starting to get harder to press for buyers. Yep, Americans will begin to come back to consider Detroit products (at least GM and Ford), and that’s not good for Toyota. And we’ve really never left Detroit for our big pickups and SUVs, whle the Japanese are still mostly playing catch up.
Yep, it’s a bad day for Toyota and a great day for America. You can look forward to a new Detroit that will be competitive, if not lead, in cars and trucks for mass market Americans. Count on it.
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Remember that Toyota’s success had to do with GM and it’s dealers ignoring customer complaints, playing fast and loose with warranty claims, substandard products all emanating from an insulated corporate culture free of dissenting voices and connections to reality.
Time will tell if these issues are fixed, but even if they are, why would content Camry/Civic/Accord owners leave their loved whips?
No chance of competing against Government Motors or Chrysler Leyland.
It’s a done deal.
This is precisely on the money.
Toyota’s “secret” was to just stay a notch ahead of customer expectations when it came to what they got for the money.
That game will change now.
I described it as follows in this editorial:
http://www.thetruthaboutcars.com/the-disconnect/
We’re looking at two strategies here. Toyota: build affordable transportation for the masses at a quality level that slightly exceeds expectations relative to price. GM et al: build oversized, under-engineered and fuel inefficient cars for people who don’t care about money while palming off sub-standard cars on mainstream customers. Is it any wonder that the truck-crazed domestic manufacturers lost mission critical market share to the transplants? Lutz and his cohorts failed to recognize that the vast majority of potential customers were simply looking for affordable quality transportation.
This is one of the best pieces I have read on TTAC in a while, no pun intended. A lot of doubters and haters will come out of the woodwork on this one, but Ken hits several good points perfectly. Ford, for all its debt and doubt, will be the new media darling…like that or not you will have to deal with it.
The problem is going to be will Americans;
a.)be so pissed off at GM for taking our money that they won’t even consider GM?
b.)continue to buy imports because that’s just what they’ve done for years, regardless of improved domestics?
c.)pass right on by Japanese and domestic cars for the greatly improved, less expensive Korean cars?
Wasn’t Toyota, Inc.’s secret yen/dollar manipulation? And dumping cars on the US market to gain share?
Toyota has built up considerable customer loyalty with its mainstream products like Corolla and Camry. And Lexus appears to be doing the same with the LS luxury sedan, which has become a standard of sorts. So I don’t think its market share will go away any time soon, though it may begin a slow decline.
But you’re right about the lack of exciting vehicles, and it’s a bad sign. The Lexus IS-F is perhaps the ONLY high-performance Totota on sale in the U.S., which is just mind-boggling. This is the company that once brought us twin-turbo Supras, the MR2, and high-revving Celica GT-S? Toyota has virtually ceded the enthusiast market to: the Europeans at the high end (and arguably Nissan with the GT-R); Nissan and Corvette in the middle where the Supra used to play; and Honda, Mazda, Subaru, et al. in the sport compact market. This cannot bode well for Toyota in the long term.
Honda seems to be trimming its enthusiast offerings too, but at least the luxurious TL sedan will be available with a manual transmission. Even the IS-F is automatic only.
Looks like Ken found some tasty Kool-Aid…
The reasons (or lack of them) that led people to buy more and more Toyotas in the years before the current crisis remain valid. I don’t think nearly as much has changed as this editorial suggests.
“Toyota’s products are not exciting”–not new. Nedmundo mentions the Supra, MR2, and Celica. Guess what? They were dropped because they weren’t profitable. Toyota’s fastest growth has occurred since dropping them.
jkross22, in the first comment, nails it: people only defect in droves when their current car is awful. Many remain loyal as long as their current car is in the ballpark–it doesn’t have to be the best, just not awful. For GM and Ford to regain share, it’s not enough that they offer competitive products. Toyota et. al. must also mess up.
Time was I bought the line, “We’ll regain share owing to excellent new products.” I don’t anymore.
We hear a lot of talk about labor costs, but they’re just a fraction of the total cost of making a car. How will GM’s and Toyota’s total costs now compare?
Ford–since they borrowed to the hilt a few years ago, they have a lot of debt to make interest payments on. And how long do they have before they must borrow again to pay this debt back?
derm81 is correct that Ford is certainly the new media darling. I guess we’ll find out how many sales this is really worth. Chrysler was the media darling back in the early-to-mid 1990s. Didn’t seem to sell many more cars as a result.
Finally, I don’t buy that small cars are going to save anyone until Americans are willing to pay a lot more for them–which I don’t see happening soon.
Ah, the Holden Effigy.
This is the car that ought to have been the next Malibu or Lacrosse. When people talk about the hypothetical “uniquely American modern automobile”, this is what they mean.
Funny that it took GM’s Australian wing to make it, and that GMNA’s Not-Invented Here syndrome wouldn’t accept that brilliance could come from outside RenCen.
Seems like a bad day for Toyota might better translate into a good day for Ford & Honda, but not necessarily GM & Chrysler. We’ll see.
You make it sound like Gov’t Motors will come out of rehab and release a series of platinum albums. As if they have somehow learned their lesson and will suddenly make good product (that they were prevented from making because of past lapses in oversight). Get real. And Toyota was never even pretending to compete with GM (except in Nascar), but rather against Honda and Nissan.
I think Hyundai is as much, or more of a problem for Toyota than GM, Ford or Chrysler.
But you’re right about it being a low point for Toyota’s smaller product. I’m assuming they’ve received the wake-up call. It will be interesting to see where they go these next few years.
I’m none too overly optimistic about the Cruze and Viva. These are both Deawoo-designed products, and I’ve yet to see them be able to be competitive.
The final problem for Detroit: inertia. It took decades for the Big 3 to lose their customers; are they really going to come back that quickly, even if they have the product? A lot of buyers have been well served by their boring Toyotas.
Nah.
Your analysis ignores the fact that Toyota’s vehicles were good because of Deming and the philosophy of constant improvement of every part of the business. It wasn’t just bad competition.
The D3 forgot everything Deming taught them – and it was the D3 who sought Deming’s advice. Why would anyone think they’ll do the right thing now, just because they are sans legacy and sans debt?
Toyonda has been the easy button, and others will match them for reliability, but I’m not convinced it will be the D3. I see BK wiping everything clean except executive culture.
If customers become dissatisfied with Toyota, my guess is they go to Honda before any of the D3. Maybe Hyundai.
No, nothing in the Toyota lineup excites me. That’s why I know Toyota is still ok.
Sort of like saying the German 6th army surrendering at Stalingrad was a bad day for the Russians because that would really piss off and unite the Germans as never before. Now they would really mean business.
Two problems with this idea:
(1) You assume that Toyota/Honda will stand still and compete with their current product line. I have no doubt that they will step up to the fight and come out with sexy products to compete.
(2) You assume that Ford/GM now “get it” and will no longer treat their customers and dealers like crap. I’ll believe it when I see it. I’d rather buy a boring Japanese transportation appliance for a little more money than run high risk of being screwed over by GM and their so called “warranty” and “happy dealers”.
I don’t see anything so far in this BK that is going to change how GM treats their customers or how they back their products. If anything, it appear to be getting worse.
I’m with Niedermeyer. It’s Hyundai, not Toyota that’s going to wallop GM between the eyes. Appearing remotely wealthy is so far out of fashion right now, that buying a Korean car is, in an odd way, a great status symbol.
Right now, if you buy a new car, you don’t want your neighbors to notice. And if they do notice, you don’t want it to be a fly yellow Ferrari.
As for Toyota, yes, it’s true, their products are not particularly exciting right now. But we’re car enthusiasts. We want to be “excited” by cars. Other people want just the opposite. That’s “Anonymous Driving Appliances.” They’re also about 95 percent of the car buyers out there.
So what do GM and Ford have that are “anonymous driving appliances” now?
There will always be a certain number of people who want something “different” in their new vehicle. As Toyota grows more dominant, there will be more of these people.
The only problem is that I don’t see large numbers of people defecting from Toyota for this reason. The number of people who want something different is always relatively small.
There won’t be any large-scale defection from Toyota unless wheels start falling off, interiors begin disintegrating or engines start exploding on a regular basis.
I do think that Ford will benefit, but primarily from customers leaving GM and Chrysler, not Toyota.
The US automakers have got to stop leaving good products to whither on the vine, they make a lot of splashy intros with competitive cars and then sit around for 7 years doing nothing but adding new fascias. They also have to kill the rebate game which depresses the crap out of resale. Boring sells far better than enthusiast, so I am not convinced that more hp is the way to go anymore.
The Supra, back when it shared a platform with the Celica sold fairly well. Both cars suffered in certain ways once they were seperated, the Supra got too fat and then too expensive and the Celica got boring.
The last Supra was ridiculous, no matter how legendary its performance was.
If they brought back the two cars on a shared RWD platform they could probably wring some money out of it. They just need to show some restraint and keep it simple and the price down.
I’m still with Ken Elias here.
Toyota and Honda had the restaurant to themselves, because the other carmakers were chasing non-viable markets.
Toyota, especially, could mine this for what it was worth, by building cars that were just a notch above expectations.
This doesn’t mean that GM now will have an easy game, but it does mean that Toyota will have a tougher one, they’ll be fighting for the market that matters, not the delusional market that Detroit focused on.
http://www.thetruthaboutcars.com/the-disconnect/
Blatant optimism without even a hint of supporting data.
“Yep, it’s… a great day for America…”
We bought an auto company we didn’t want; with money we didn’t have while cutting budgets at kids schools.
I’ll take some of that kool-aid please.
““Toyota’s products are not exciting”–not new.”
I disagree (the not new part). When Toyota (really Honda too) starting building momentum and image they offered cars that were substantially different in look and feel to the domestic offerings. Even the doughiest sedan was smaller, more responsive and had excitingly different ergonomics. I’m not saying these cars were all Miata’s, just that they may as well have been, from an average consumer’s standpoint, compared to the Oldsmobiles and Buicks everyone was used to at the time. Without that unique character all the Japanese had was a statistics rep…with it they had a set of traits which customers could grasp onto as a source of the difference (regardless of how irrelevant that was to the reliability). In short it gave the impression of real difference.
Now I don’t think Toyota is going to crash and burn or anything, but they are going to lose customers when those customers test drive, or read really any comparison test that dosen’t focus solely on top spec models. I also think that the slow drain will be worse for Toyota’s product lineup than their current quality (not reliability) indifference already is. If it gets bad enough they’ll end up spending more and more of their time shuffling things around trying to keep their lines profitable, lines which were desinged in better days with higher sales volumes, just like GM’s been doing for the last bunch of years.
Just like GM, they are going to generate a lot of bad press with every round of lay-off’s, and that will only amplify the noise machine’s treatment of recalls, horror stories etc…
Now, stop and think about this. What has Toyota done for you lately? Is there one single passenger car from Toyota that excites you?
There’s 2 problems with this statement.
1. There are some good products on the horizon (which I’ll come to later).
2. Toyota’s products aren’t exciting, but that’s the point. Toyota has made billions from appliances, we’ve proved this time and time again.
This is why Toyota withdrew the MR2 and the Celica because they weren’t making enough money. It’s this kind of thinking which made Toyota a money making machine.
As for new products, Toyota have the new Avensis out which is a really good car. Some reviewers in Europe are seeing it as a Ford Mondeo beater. They’ve improved the handling and driving dynamics, plus the fuel economy and emission figures are outstanding (beats the Ford Mondeo like a ginger step child). It also looks very good. Also, it is loaded with toys as standard, but are options on the Ford Mondeo. Another plus point.
I’m certainly considering one as my next car (other contenders are the Jaguar XF and Toyota Auris, another great car from Toyota).
The Toyota Aygo is another great car. Cute, fun to drive, cheap to insure & run and great fuel economy & emission figures.
The american producers coming out of bankruptcy is not going to be a problem.
Firstly, how many american consumers are against the bailouts for GM and Chrysler? Do you honestly think they are going to buy a car from them?
Secondly, people were shunning Buicks and Chevrolets before GM’s chapter 11, what’s going to change that people will buy one AFTER Chapter 11?
The only one which will cause Toyota a problem is Ford. Their quality is good, their cars are “interesting” and they have a good public perception.
Personally, I think Toyota will relish the challenge. It brings out the best in them. When Toyota first came to the US with rust buckets and failed, did they give up?
GM and Chrysler wished they did……
Mr. Niedermeyer – spot on. Hyundai is the new thorn that will annoy Toyota and to a lesser extent Honda. Toyota’s troubles this year in marketshare have less to do with product, loyal base or the resurgent Ford than Hyundai creaming them at building affordable, relatively reliable vanilla vehicles. Few extra problems, but a few extra bucks in your pockets up front.
Honda will rise above some of that for a while. I think Honda has the most to win in the short-ish term, but I think the challenge for Honda will come when Ford gets its car line-up in order. The Accord was more heavily cross-shopped with the Fusion than Camry relative to the volumes of those vehicles. I suspect that in the future, the Civic will be more heavily cross-shopped with the Focus than Corolla. Both companies are focusing not on basic transport and reliability, but complete vehicle offerings with some style, features and composure found on more expensive vehicles. The Fiesta and B-Max will be a problem for the Fit and will steal from the Yaris, but none of those vehicle will ever be as cheap or crappy as the Yaris. And if Ford manages to pull off its Ecoboost transformation in the next 4 years with Fusions that get 40+ mpg hwy without an expensive hybrid system and Edges rolling with 30 mpg, 245tq@1500 engines, I suspect Honda will hurt even more.
Toyota = right now, winning a little from Chrysler and GM, losing from Hyundai – a lot, I think…
Honda = right now, winning a little from Chrysler and GM, losing a little from Hyundai and Ford, but marketshare relatively stable.
Ford = right now, winning from Chrysler and GM, losing a little from Hyundai.
Hyundai = right now, winning a lot from Chrysler and GM and a good chunk from Toyota.
Tomorrow should be interesting…
I’m have to pitch in with the “not so fast” camp.
Little of Big T’s current product does anything for me but I doubt the “they were just beating up cripples” premise.
“New” GM a problem? Probably not. The Gov’t can barely keep up with the cash burn. With Uncle Sugar in the background to catch them I will not be surprised if any motivation to maintain or improve efficiency, reliability, quality, design etc. just went out the airlock.
I’m going to go out on a limb (and it looks stout to me) and say that the future product of the “new GM” will remind us why state owned factories produce Trabants und Wartburgs.
Ford-which I think has a chance to return strong-has some serious challenges ahead.
Hyundia-Ya, they are real competition.
Toyota-since when do they stand still-even now they are changing at the top to meet tomorrows challenges.
I predict a tough summer for everyone as they compete with Gov’t Incentive Motors, but both branches will implode, shrink more, or die completely.
Result, more market share for the rest, esp. Hyundia, Ford, Honda and (yes) Toyota to soak up.
Toy and Ford will dominate trucks in 2-5 years.
That heavily derided plant in Texas will suddenly look like a sharp long term move. Count on it.
My thoughts.
Cheerio,
Bunter
This is an interesting article, however, it fails to provide a time frame for people to start reconsidering American products. From the time Consumer Reports declares the Americans are back in the game until I would consider an American vehicle is about 10 years, and I don’t think I am much different from most Japanese car buyers.
Do they have 10 years?
Ken, one issue…you are assuming GM and Ford can continue developing product on par with their best, most recent offerings. GM without Opel, and Ford without Mazda, means no decent new mass market (4-cylinder) automobile platforms to work with. Daewoo will not improve to this level to fill this void. So the current platforms will stick around a very long time, and likely become obsolete.
It’s good to have contrarian opinions once in awhile. Consensus sucks.
But here’s my thoughts: while cost was a big issue for the domestics, product was a bigger one. Obviously a high cost structure led to less resources being available to design products, but in the end, have either GM or Chrysler proven they can design a good midsize car, which is the KEY turnaround segment?
Ford has done it many times over and the new Taurus is actually a great car. Aside from the Malibu, GM’s best car is the Imapala which isn’t going to wet anyone’s panties. Meanwhile, Chrysler is stuck with a Sebring until a big Fiat arrives. So nothing’s changed on the REVENUE side of things.
I’m extremely unhappy GM and Chrysler took money out of my pocket by not earning my business but by using the government to do so.
I will NEVER purchase another GM or Chrysler product. This probably doesn’t mean much but Ford will benefit by around a dozen vehicles a year for my business. That’s too bad for GM and Chrysler, I had good luck with Silverados and Dakotas.
Ken,
Don’t give up your day job.
Toyota and Honda (and probably most of the dozen other auto companies in the American market) will be around long after GM and Chrysler have faded away. Camry and Accord have cut a very wide swath through the entire American car market and are already deeply entrenched. Don’t expect them to be dislodged anytime in the next dozen years or so.
When Detroit lost Mid-America, they lost it for an entire generation and more.
Please do not build Ford up to more than they really are. More of their product is on the level of the Ranger pickup (25 years out of date) than category-leading.
NN,
Good point. An even better question:
How soon can GM re-start its frozen product development programs? Is this going to happen in the next few weeks?
superbadd75
The problem is going to be will Americans;
a.)be so pissed off at GM for taking our money that they won’t even consider GM?
b.)continue to buy imports because that’s just what they’ve done for years, regardless of improved domestics?
c.)pass right on by Japanese and domestic cars for the greatly improved, less expensive Korean cars?
I think I am A. and C.
I’ll never reward the government for nationalizing anything. But I mainly blame the politically connected UAW. So, sorry Ford, even though you restrained yourself from my money the precedent of the other two has taken its toll on you too.
Doesn’t anyone think that American buyers might feel like they HAVE to buy a bailout car? I mean they own 60% of the company right? How do I make sure that I don’t have to give more tax money to these guys? Well I guess I’ll buy a Malibu and tell everyone how great it is. Surely some of this will happen.
@KatiePuckrik: in what alternate dimension of Europe has the Avensis been called a Mondeo beater? I read many European car reviews and the general response to the new Avensis has been only slightly better than lukewarm. As for the looks, that’s completely subjective; I consider the Avensis nice-looking from the A-pillar back, but with a decidedly WTF front end. I grant that the emission figures are impressive, but other than that, so what?
The Auris is even more underwhelming; it’s little more competitive than the Corolla that preceded it, complete with cheapo torsion beam rear suspension in all but the top-line model, dumpy styling and acres of cheap plastics. Yes, it’s reliable. But so is the better-handling, better-looking and generally much more interesting Civic.
Toyota will probably have a tougher time going forward, but it’s far from a doom-and-gloom scenario for them. I’m skeptical of GM and Fiatsler’s prospects; I see Ford coming out strong if the Fiesta and Focus are half as good as the hype. Hyundai will continue to be a pain in everyone’s ass, though the overlap with Kia will need to be managed carefully (so far it looks good, with Hyundai being positioned as the full-range sensible brand and Kia as the cheeky, stylish alternative). At any rate I doubt Toyota will be dominant for as long as GM was back in the mid-century heydays.
NN: GM without Opel, and Ford without Mazda, means no decent new mass market (4-cylinder) automobile platforms to work with.
Ford did not give up its entire stake in Mazda. It reduced it to the point where it no longer has effective control of the company, but it still owns a chunk of the company.
The assumption seems to be that Toyota will stand still and let GM, Ford and that other one catch up. True the domestics have new products in the works that look exciting but as in the past they are still working at catching up. What is on the horizon for Toyota, Nissan and Honda? Don’t you think they have seen the new US products and are working on new products? I agree with a previous commenter that Toyota and Honda have built a loyal base who will continue to buy their products. I will and it will take some real persuading for me to buy a domestic again. They sold me POS in the past and didn’t stand behind their products. Now they are bankrupt and you think suddenly all will be well in the future. Dream on.
I dunno. Just because the GM Death Watch has reached its end doesn’t mean that a replacement is required just for the sake of it.
Toyota is in fine shape, despite the short-term losses. The brand is solid, it had segment leaders, and it has a truck that will give it the ability to take advantage of GM’s and Chrysler’s weaknesses.
Meanwhile, its main US rival Honda is too conservative and timid to take advantage of this power vacuum, while Hyundai is still too dependent upon low price as a primary advantage in order to compete head-on based upon brand equity. A US economic recovery, which is most likely already underway (no, you never see these thigs until after the fact) and restored credit markets will put Toyota in a good position to rule the roost.
Assuming their recovery actually succeeds, chances are high that Chrysler and GM will producing much lower volumes, with less fleet in their mix. The real thing that sucks about this is that the cost of car rental is going to go up. You can expect more Hyundais and Kias in your rental future.
How can it be good for a company when it’s competitor can print money?
But then the question is why does GM even pretend to sell cars? That’s enough cash for all of the workers to retire and continue to spend to support other industries.
I think this article was written about two years prematurely.
Today was merely the day that bankruptcy was declared.
There is no evidence that the problems leading up to this have been recognized, let alone fixed.
There is no evidence that desirable, reliable product has been designed, prototyped, or manufactured at a price point acceptable to the potential customer base.
There is no evidence that reprehensible sales tactics have been eliminated or that dealer service improvements have even been considered, let alone implemented.
I’m an optimistic guy, so I am willing to take a wait-and-see attitude on all this. But let’s not get ahead of ourselves here. Let’s see some evidence.
Toy and Ford will dominate trucks in 2-5 years.
That heavily derided plant in Texas will suddenly look like a sharp long term move. Count on it.
I disagree with Toyota dominating the truck market. They have struggled to turn loyal big 3 truck drivers and even with GM down, the big T will continue. The Tundra just isnt as good a product as the F150.
I consider Toyota today to be what GM was in the mid 80s and early 90s. Today every fifth car is a Camry, while in the 80s, half the cars had a “Cutlass” logo (usually crooked) on the trunk. In comparison to other midsized sedans, Camrys were solid, basic transportation. Today they still are, but everything else has matched or surpassed them in quality and trounces them in style. The materials and attention to detail have become conspicuously iffy in the latest generation Camry and unquestionable trash with the Corolla. I’m not saying that they’ve become as crummy as a 1984 Cutlass Supreme, but a Camry and a Corolla are vile in so many ways that makes some owners say “I have become the most boring person on my cul-de-sac.” So people are eyeballing Ford, GM, Mazda and even Hyundai and VW. While people romanticize the Toyota of the 90s because they offered the Supra and MR2, Toyota’s foundation has always been profitable whitebread. That’s what people associated with reliability and that’s why Toyota has rightfully been the default choice by an awful lot of people for a long time. But Toyota’s customer base is going to steadily siphoned away as other automakers develop more compelling vehicles that have reached an even higher level of quality. I drove a buddy’s CTS which he bought as a replacement to his Lexus ES. If these two cars are an accurate apples-to-apples case study, this case is closed even before the benefits (if there are any) of the re-org kicks in.
This felt so much like one of Sweet Peet’s posts, I had to check the URL.
The editorial raises interesting questions, but it also assumes lots of things that are unlikely to happen.
Yes, the balance sheets will look better, and the air will be full of hope and change. But, people seem to forget that the same people who ran GM before the bankruptcy are running it now. Only now, they have an army of bureaucrats helping them do the politically correct thing. Toyota has nothing to worry about when it comes to Chrysler and GM. Ford may be a better competitor if they can weather the recession without bailout money. The real competitors are still in Asia and they’re gaining ground.
Sorry ken but only one word comes to mind: ‘Poppycock’
Refreshing article.
Agree, today is Toyota’s bad day… remember they didn’t want Detroit go bust.
Thing is, GM, Ford and Chrysler have to develop truly outstanding cars people want to buy.
From GM I see the CTS, Corvette, Malibu, Tahoe, Silverado, G8 (should be an Impala), 9-3, Camaro. They need to bring the current Opel Corsa to the US.
Ford: New Focus, the current one is hot, new Fiesta, Falcon (yeah, bring it from Aussiesland), Mustang.
Chrysler: current Grand Cherokee, next one, Wrangler, RAM, I think they should bring back the cab forward, Challenger.
The only Toyota that I think is nice is the Yaris. I’ve seen some new Toyotas and the materials employed up to mid 90’s cars looks way more upscale than the crap they’re building now.
Only Hondas I like are the Civic and S2000
“Count on it”?
Miru koto wa shinjiru koto desu. Don’t forget Hyundai, Nissan, Subaru and Mazda are still around to contended with.
I’m not buying it either–and didn’t GM just lose Opel? You know — the dividsion that seemed to be providing the technology behind the newer, non-sucky GM cars (Aura, Malibu and the upcoming Buick Lacrosse based on the Opel Insignia and Cruze based on the new Astra). How much of the talent responsible for those platforms is GM keeping?
And remember Magna is buying Opel, getting ready to manufacture in Ontario and, maybe, distribute through the Saturn network (whose dealers are, obviously, already up to speed on Opel technology). New GM may end up competing with a company that has rights to their technology and actually employs the engineers most responsible for creating it — ouch.
A well known and always effective stratagem is to make certain that your enemies (competitors) are so busy fighting each other over the imagined spoils, that they miss the action taking place right under their noses.
That’s been Toyota’s Way for a long time — while sites such as this one have knocked their product for being bland and uninteresting, the fact that it was profitable and built them into a behemoth didn’t register.
While GM got kudos for building itself out of existence pursuing imagined spoils.
And that’s what Ken Elias touches upon here. He’s right – Toyota certainly wishes that most of the world’s car companies remained busy fighting for the less profitable territory. So Toyota’s competition did get tougher, doesn’t mean they’ll lose, just that they won’t have the profitable market to themselves anymore. Everyone’s moving in on it now.
Kool-aid indeed.
As if all GM needs is just one more RWD performance car, because you know, Camry’s just suck.
Sometimes I wonder if the writers here ever get out of their echo chamber much. The rest of America, the folks who buy the dang cars, don’t “set aside the Prius for a second”. They BUY it.
Yeah, I know it bothers your performance sensibilities, but the numbers show that Prius-killers are an important component of any GM comeback. Not another V8 or some opportunity to hire John Cougar and Pete Seeger to screech a duet about a new rEvOluTION with another RWD performance car for the 800 people who fall over themselves for one.
Don’t get me wrong, I love those cars too. But other than the fleet buyers who have inflated falsely the sales numbers of the plastic-ridden Malibu, the only thing that matters are those buyers who are looking at cars like the Prius and marching to the dealer who offers them.
Now, stop and think about this. What has Toyota done for you lately? Is there one single passenger car from Toyota that excites you?
Oooh, ESC now standard on all vehicles except the Yaris.
If boring equates to a extremely competent minivan with minimal unexpected repairs (read: a CD player), so be it. I’m may be merely content, rather than excited, at not having any major repairs with mine.