You’ve got to have some sympathy for Toyota. They finally injected some passion into the Corolla, Camry, and Avalon at exactly the time when people are jumping ship to crossovers. To be fair, Toyota will still probably still sell over 600,000 of the Corolla and Camry for years to come. But it is a bit ironic. Those cars really aren’t the problem. It’s pretty much everything else that is cause for concern. Lexus probably needs to kill off its sedans. And Toyota needs to rationalize its crossover lineup and update its body-on-frame utility vehicles.
The Rav4 is fine though. And there is one area where Toyota is kicking ass: hybrids.
It was not a great year for any Toyota car not named Corolla or Camry. Both cars held their ground in a rapidly declining market. Literally everything else that’s been on sale longer than a year experienced a double digit decline. That includes the artist formerly known as Scion iA, the Yaris. Sales barely crested the 20,000 mark. The slightly rebadged Mazda 2 isn’t a big risk for the company, so it will probably stick around for a while. Ironically, Mazda might not make the most exciting Yaris for much longer. International markets will receive a home grown Yaris based on Toyota’s TNGA platform. It will even offer all-wheel drive. And there’s a crazy performance variant too. Once again, desirable small cars become forbidden fruit for Americans. Same as it ever was.
The other declines aren’t terribly surprising. The 86 sells so slowly its successor might wear a different name. The Avalon doesn’t really make a case for itself given the overall excellence of the Camry. And customers are justifiably shunning the Prius for hybrids that don’t look like something out of a Japanese anime. Supra aside, the only interesting Toyota cars worth watching this year are the Camry and Avalon. The addition of all-wheel drive could conceivably keep customers in the fold.
Toyota’s utility lineup is in need of improvement. Or is it? The Rav4 is still king of the crossovers, posting a notable 5% increase in sales. That’s a solid victory to score in such a cutthroat segment. Last year, the compact segment outsold compact and mid-size cars combined. Toyota deserves a tip of the hat for successfully redesigning their crown jewel. How hard should Toyota sweat the decline of pretty much everything else? Hard to say. But here’s something to think about: Toyota’s utility lineup only sold about 50,000 more units than the Rav4 last year. Plus, the declines aren’t too bad. The real issue is the CH-R and missing mid-size crossover. Toyota’s subcompact crossover is one of the slowest selling models in the segment. It received middling reviews when it debuted and it doesn’t even offer all-wheel drive. The company can and should do better. Additionally, the lack of a Venza replacement is disappointing. Customers are clearly buying mid-size crossovers. Chevy sold almost 60,000 Blazers last year. Toyota is poised to miss out on a potentially profitable segment.
Toyota’s body-on-frame vehicles could definitely use updates, although the Tacoma still resonates with a lot of buyers. All of these models have likely been paid for at this point, so the losses probably aren’t serious as the sales numbers might suggest. Everyone should be jealous at the person who snagged what might be the last new FJ Cruiser in America. Used examples are red hot right now, so they could probably flip the thing and make a substantial profit, provided the dealer sold it to them at a reasonable price.
Lexus definitely has too many cars. Aside from the ES, no other high volume model justified its existence in 2019. It’s hard to say what the brand could be doing differently here given the state passenger cars. It seems BMW and Mercedes are the brands where shoppers go when they want a smaller luxury sedan that’s gasoline powered.
UX FTW? The subcompact luxury crossover helped Lexus stem the bleeding from the drop in sedan sales. The NX and RX didn’t light the charts on fire, but their segments are getting more competitive by the day, so their minor losses are understandable. Lexus could probably use a decent three row SUV. Otherwise, there’s not much to say about these products.
If you want to know why Honda, Ford, and the Koreans are still investing in hybrids, look no further than this chart. Car shoppers are clearly interested in partially electric vehicles. Just look at the 93% increase of the Rav4 hybrid! Even the Highlander hybrid posted a substantial gain, despite its age. That bodes extremely well for the new model, which gets 34mpg combined. It seems the key to creating desirable hybrids is stellar fuel economy, an attractive exterior, and standard or optional all-wheel drive.
It’s hard to say if Toyota needs to be doing anything differently. The company is still doing pretty well when it comes to passenger cars and crossovers, but there are some blind spots. The C-HR is mediocre product in a growing segment. And the lack of a mid-size crossover is a surprising oversight. But their hybrid push is bearing substantial fruit and Lexus crossovers are probably doing about as well as can be expected given the competition. Average transaction prices were up 2.3% last year too. What Toyota really needs is a new body-on-frame platform. But they’re almost certainly working on that right now. Staying the course is a prudent course of action.