Toyota Seeks Heart-Racing Camry Without Losing No. 1 Spot – Bloomberg

Posted: Friday, January 17, 2014

Toyota Motor Corp. (7203) has a challenge:
How to heed President Akio Toyoda’s insistence on heart-racing
design for the next Camry and Prius models without jeopardizing
their mass-market appeal.

Getting it wrong risks knocking Camry from its perch as the
best-selling U.S. car, a title held for 12 consecutive years,
and seeing Prius, which sells more than 200,000 units annually
in the U.S., eclipsed by newer hybrid vehicles. While next-generation versions of both cars are in the works, Toyota
executives haven’t provided many details.

The aim for the next Camry is a “more emotional, more
impactful design,” Kevin Hunter, head of Toyota’s U.S. design
studio, said in an interview at the North American International
Auto Show in Detroit this week. “Camry’s taken some hits on
styling, but it’s still selling well. But we need to create
better design for Camry in the future.”

Toyoda, grandson of the company’s founder, is pushing an
overhaul of vehicles with an emphasis on “waku-doki” design,
shorthand for the Japanese phrase for heart-racing qualities.
That would break from the current styling of the Camry and
Prius, which together accounted for about a third of the Toyota
City, Japan-based company’s U.S. sales volume last year.




Photographer: Kiyoshi Ota/Bloomberg

Toyota Motor Corp. President Akio Toyoda.

Toyota Motor Corp. President Akio Toyoda. Close

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Photographer: Kiyoshi Ota/Bloomberg

Toyota Motor Corp. President Akio Toyoda.

“Finding the right balance is going to be very tricky”
for the Camry, said Jack Nerad, analyst and executive editor at
Kelley Blue Book in Irvine, California. “Most consumers like
good-looking cars, they don’t want to drive appliances.”

Camry Challenges

Because Camry’s customer base, which Toyota estimates is 5
million owners, is so large, there are limits to how far the
company can go in changing the design, Kazuo Ohara, head of
Toyota’s U.S. sales unit, said.

“I would not go so far as saying we could be adventurous,
but at least more aggressive,” he said in an interview in
Detroit this week. With the current Camry, “we were probably a
little bit too conservative.”

The emphasis on the next version of the car is enhanced
interior packaging and materials and more “emotional” exterior
looks, Ohara said, without elaborating on specific details. The
company isn’t ready to say when a new Camry or Prius will go on
sale, the executives said.

U.S. Camry sales were 408,484 in 2013, topping newer
sedans, including Honda Motor Co.’s Accord, Nissan Motor Co.’s
Altima and Ford Motor Co.’s Fusion, with faster-growing sales.
The Accord is the No. 2 car, with 366,678 units sold last year,
according to a Honda statement this month.

Top Seller

Even with Hyundai Motor Co. adding a revamped Sonata and
Chrysler Group LLC releasing a new 200 model this year, Toyota,
the world’s largest automaker, forecasts that Camry will
maintain its lead and 400,000-unit volume for a 13th straight
year, Bob Carter, Toyota’s U.S. senior vice president, said in
an interview.

The Prius also faces competition. The world’s iconic hybrid
is losing the one-of-a-kind status it held into the mid-2000s as
the most advanced electric-drive auto in the U.S. Rival hybrids,
plug-ins and all-electric cars, such as Nissan Motor Co.’s Leaf,
General Motors Co.’s Volt and Tesla Motors Inc.’s Model S, are
all alternatives to Prius.

“In the beginning Prius was the pioneer of the segment,”
Jim Lentz, Toyota’s North American chief executive officer, said
in an interview in Detroit this week. “As we put the powertrain
into the Camry, it put hybrids into the mainstream. Prius did
its job in creating hybrid as a mainstream option.”

Prius Pioneer

As Toyota’s designers refine the look and layout of the
next Prius, they said they will need to retain the car’s
triangular profile for maximum aerodynamic efficiency and top-level fuel economy.

“The next Prius is in a difficult location in the market
because hybrids already have become a fundamental technology,”
Tokuo Fukuichi, a Toyota senior managing officer and head of
global design, said in an interview in Detroit.

“We have to try to make a ‘future feeling’ and ‘best in
the world’” fuel economy, Fukuichi said. “If we couldn’t get
the best mileage, we don’t need a next Prius.”

Toyota’s U.S. sales unit is in Torrance, California.

To contact the reporter on this story:
Alan Ohnsman in Detroit at
aohnsman@bloomberg.net

To contact the editor responsible for this story:
Jamie Butters at
jbutters@bloomberg.net

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