Is Camry's shelf life running down?
03-27-06, 06:09 PM
#1
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Is Camry's shelf life running down?
IndyStar.com Business
March 26, 2006
Is Camry's shelf life running down?
Model coming to Lafayette is no hit with younger set
By Ted Evanoff
ted.evanoff@indystar.com
As Toyota prepares a $230 million Camry assembly line in Lafayette, the Japanese automaker faces a vexing issue: Who will buy the Camry in five or 10 years?
No. 1 auto: Landing the Camry, the best-selling car, is regarded as an economic coup in Indiana. But how will it sell 10 years from now? - Associated Press
Camry has outsold every other sedan every year since 1997. But relatively few 25-year-olds today aspire to ever own the same brand as mom and dad.
"Younger people see the Camry as an older person's car,'' said auto analyst Art Spinella, who surveys shoppers for carmakers and auto dealers nationwide. "It certainly isn't a youth-market vehicle. That's really Toyota's core problem.''
Most analysts expect Toyota will close the Camry generation gap. If the carmaker falls short, though, and sales volume slumps, Toyota might have to consider curbing or ending the Indiana venture.
Toyota announced a contract with Japanese rival Subaru on March 13. The under-used Subaru of Indiana Automotive plant in Lafayette will hire up to 1,000 workers and set aside an assembly line for Camry, beginning in spring 2007.
SIA would make about 40,000 Camrys that first year for Toyota and up to 100,000 a year by 2009. Toyota's main Camry line will continue full pace at about 400,000 autos a year in Georgetown, Ky.
The four-door Camry is a midsized car, usually priced at $19,000 to $25,000, depending on options.
"Camry has been criticized for bland styling," said Toyota spokesman Jim Wiseman. "We'll restyle the car for 2007. It's a fine line. You don't want to make it so cutting edge it loses the hundreds of thousands of drivers it appeals to.''
Landing a plant that will make the nation's best-selling car is regarded as an economic coup in Indiana. It also brings risk. Camry will tie the state industrial economy again to the vagaries of the car market.
As market share receded for Detroit brands Chrysler, Ford and General Motors, Indiana auto-parts plants closed, and layoffs mounted. No longer an upstart, Toyota is the established car brand. Now it's trying to defend reigning sales leader Camry, a favorite of American baby boomers, from upstart foreign rivals.
"In five years, not only will Toyota have Detroit and Honda and Nissan and Volkswagen to contend with, it'll have Hyundai and Kia from South Korea, and Chinese vehicles in the U.S., maybe multiple ones from China,'' Spinella said. "What market are they all going to be targeting? The midsize sedan market is the place to start.''
Spinella, of CNW Marketing Research of Bandon, Ore., notes a restyled Camry will help fend off rivals. Analysts point out, however, that Toyota also must lure younger buyers. If it doesn't, Camry still could lose the sales crown.
"The average age of the Camry buyer is higher than one might think," said market analyst Tom Libby in the suburban Detroit office of automotive researcher J.D. Power and Associates.
Camry's typical buyer is 52, almost a decade older than buyers of Honda Accord and Nissan Altima. Often Camry buyers trade in used Camrys. Nearly 40 percent of new Toyota sales involve Toyota trades.
That's a sign of high brand loyalty. It's also a sign baby boomer Camry drivers trade up for new Camrys.
Toyota manufacturing executives say Lafayette output will end Camry imports from Japan, though it also could open the way for the Georgetown plant to usher in a Camry replacement model.
Only about 25,000 Camry and Solara coupes were imported last year. So industry analysts suggest an alternative strategy underpins the Lafayette expansion.
Toyota appears ready to use some of Georgtown's capacity for a tall station wagon. Lafayette then would make up any lost Camry volume, said industry analyst Erich Merkle of IRN Inc. of Grand Rapids, Mich., which forecasts automobile production volumes for auto parts suppliers.
Luring young buyers might sound like an unusual problem. But Buick is an example of brand decline.
When minivans and sport-utes proliferated in the early 1980s, General Motors' Buick division stayed with its sedans. Then a major brand, Buick sold 1 million cars a year, more U.S. cars than Toyota now sells in a year.
Buick's sedan drivers have remained loyal, but Buick's average buyer is now 62. Starved for younger drivers trading up for bigger cars, Buick sales have slumped. Only 282,000 Buicks were sold last year. GM has razed massive Buick City, a 95-year-old manufacturing complex in Flint, Mich.
"The difference between what Detroit goes through and what Toyota goes through is that for every single problem Toyota has, they put a team on to fix it,'' said Spinella. "Detroit pretends it doesn't exist.''
Not even Toyota executives say the carmaker fixes every problem on the first try. By the mid-1990s, for example, it was clear baby boomers favored Camry and their kids didn't.
Toyota experimented, created the Scion brand. Pitched to surfers and skiers, the practical econobox wowed Florida retirees.
"Toyota wound up with this paradox,'' Spinella said. "They're selling a car meant for young people to older people. It's not where they wanted to be.''
Company execs never have dismissed Scion as a failure, said Toyota's Wiseman.
"We have this theory. It's part of the corporate culture,'' Wiseman said. "You try, you tweak it, tweak it again. Whatever you try, you check it out, take new action, go through the cycle. You keep tweaking. That's one of the hallmarks of our success.''
Now Toyota is refocusing resources. What young skiers like are sport-utes. Toyota is bringing out the FJ Cruiser, a smaller version of its rugged Land Cruiser.
Toyota execs figure the SUV and other models ultimately will attract more young drivers who, over the next decade, will trade up for Camrys.
"That's why we freshened the design of the Camry. That's why we're doing the Scion. That's why we're doing the FJ Cruiser,'' said Dennis Cuneo, Toyota senior vice president for manufacturing. "The FJ Cruiser we think is going to appeal to a younger generation.''
source : Indystar.com
March 26, 2006
Is Camry's shelf life running down?
Model coming to Lafayette is no hit with younger set
By Ted Evanoff
ted.evanoff@indystar.com
As Toyota prepares a $230 million Camry assembly line in Lafayette, the Japanese automaker faces a vexing issue: Who will buy the Camry in five or 10 years?
No. 1 auto: Landing the Camry, the best-selling car, is regarded as an economic coup in Indiana. But how will it sell 10 years from now? - Associated Press
Camry has outsold every other sedan every year since 1997. But relatively few 25-year-olds today aspire to ever own the same brand as mom and dad.
"Younger people see the Camry as an older person's car,'' said auto analyst Art Spinella, who surveys shoppers for carmakers and auto dealers nationwide. "It certainly isn't a youth-market vehicle. That's really Toyota's core problem.''
Most analysts expect Toyota will close the Camry generation gap. If the carmaker falls short, though, and sales volume slumps, Toyota might have to consider curbing or ending the Indiana venture.
Toyota announced a contract with Japanese rival Subaru on March 13. The under-used Subaru of Indiana Automotive plant in Lafayette will hire up to 1,000 workers and set aside an assembly line for Camry, beginning in spring 2007.
SIA would make about 40,000 Camrys that first year for Toyota and up to 100,000 a year by 2009. Toyota's main Camry line will continue full pace at about 400,000 autos a year in Georgetown, Ky.
The four-door Camry is a midsized car, usually priced at $19,000 to $25,000, depending on options.
"Camry has been criticized for bland styling," said Toyota spokesman Jim Wiseman. "We'll restyle the car for 2007. It's a fine line. You don't want to make it so cutting edge it loses the hundreds of thousands of drivers it appeals to.''
Landing a plant that will make the nation's best-selling car is regarded as an economic coup in Indiana. It also brings risk. Camry will tie the state industrial economy again to the vagaries of the car market.
As market share receded for Detroit brands Chrysler, Ford and General Motors, Indiana auto-parts plants closed, and layoffs mounted. No longer an upstart, Toyota is the established car brand. Now it's trying to defend reigning sales leader Camry, a favorite of American baby boomers, from upstart foreign rivals.
"In five years, not only will Toyota have Detroit and Honda and Nissan and Volkswagen to contend with, it'll have Hyundai and Kia from South Korea, and Chinese vehicles in the U.S., maybe multiple ones from China,'' Spinella said. "What market are they all going to be targeting? The midsize sedan market is the place to start.''
Spinella, of CNW Marketing Research of Bandon, Ore., notes a restyled Camry will help fend off rivals. Analysts point out, however, that Toyota also must lure younger buyers. If it doesn't, Camry still could lose the sales crown.
"The average age of the Camry buyer is higher than one might think," said market analyst Tom Libby in the suburban Detroit office of automotive researcher J.D. Power and Associates.
Camry's typical buyer is 52, almost a decade older than buyers of Honda Accord and Nissan Altima. Often Camry buyers trade in used Camrys. Nearly 40 percent of new Toyota sales involve Toyota trades.
That's a sign of high brand loyalty. It's also a sign baby boomer Camry drivers trade up for new Camrys.
Toyota manufacturing executives say Lafayette output will end Camry imports from Japan, though it also could open the way for the Georgetown plant to usher in a Camry replacement model.
Only about 25,000 Camry and Solara coupes were imported last year. So industry analysts suggest an alternative strategy underpins the Lafayette expansion.
Toyota appears ready to use some of Georgtown's capacity for a tall station wagon. Lafayette then would make up any lost Camry volume, said industry analyst Erich Merkle of IRN Inc. of Grand Rapids, Mich., which forecasts automobile production volumes for auto parts suppliers.
Luring young buyers might sound like an unusual problem. But Buick is an example of brand decline.
When minivans and sport-utes proliferated in the early 1980s, General Motors' Buick division stayed with its sedans. Then a major brand, Buick sold 1 million cars a year, more U.S. cars than Toyota now sells in a year.
Buick's sedan drivers have remained loyal, but Buick's average buyer is now 62. Starved for younger drivers trading up for bigger cars, Buick sales have slumped. Only 282,000 Buicks were sold last year. GM has razed massive Buick City, a 95-year-old manufacturing complex in Flint, Mich.
"The difference between what Detroit goes through and what Toyota goes through is that for every single problem Toyota has, they put a team on to fix it,'' said Spinella. "Detroit pretends it doesn't exist.''
Not even Toyota executives say the carmaker fixes every problem on the first try. By the mid-1990s, for example, it was clear baby boomers favored Camry and their kids didn't.
Toyota experimented, created the Scion brand. Pitched to surfers and skiers, the practical econobox wowed Florida retirees.
"Toyota wound up with this paradox,'' Spinella said. "They're selling a car meant for young people to older people. It's not where they wanted to be.''
Company execs never have dismissed Scion as a failure, said Toyota's Wiseman.
"We have this theory. It's part of the corporate culture,'' Wiseman said. "You try, you tweak it, tweak it again. Whatever you try, you check it out, take new action, go through the cycle. You keep tweaking. That's one of the hallmarks of our success.''
Now Toyota is refocusing resources. What young skiers like are sport-utes. Toyota is bringing out the FJ Cruiser, a smaller version of its rugged Land Cruiser.
Toyota execs figure the SUV and other models ultimately will attract more young drivers who, over the next decade, will trade up for Camrys.
"That's why we freshened the design of the Camry. That's why we're doing the Scion. That's why we're doing the FJ Cruiser,'' said Dennis Cuneo, Toyota senior vice president for manufacturing. "The FJ Cruiser we think is going to appeal to a younger generation.''
source : Indystar.com
03-27-06, 06:22 PM
#2
"Who will buy the Camry in five or 10 years?"
Another note: "Who will buy the Camry in five or 10 years?" Answer: all the GM and Ford customers when their cars break down.
03-27-06, 07:12 PM
#3
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Whle other carmakers make the gheyest press releases, its refreshing to see Toyota ACKNOWLEDGE WEAKNESS. The Camry is a family car and clearly not talked about by the youth nor people my age as something to buy.
Its great to see they truly are aware of this issue.
Its great to see they truly are aware of this issue.
03-27-06, 09:52 PM
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Originally Posted by LexArazzo
"The difference between what Detroit goes through and what Toyota goes through is that for every single problem Toyota has, they put a team on to fix it,'' said Spinella. "Detroit pretends it doesn't exist.''
Forget about absurd union contracts.
Forget about healthcare issues and legacy overhead costs.
This right here is probably 75% of Detroit's problem, and that has everything to do with poor management.
03-28-06, 06:27 AM
#5
Lexus Fanatic
As usual, Spinella is way off base...he has never impressed me.
Toyota had better keep the Camry in production. In 10 years those " young " people won't be so young anymore. Besides, there are a fair number of young people driving Camrys NOW.
Toyota had better keep the Camry in production. In 10 years those " young " people won't be so young anymore. Besides, there are a fair number of young people driving Camrys NOW.
Last edited by mmarshall; 03-28-06 at 06:31 AM.
03-28-06, 07:20 AM
#6
That article is very fuzzy thinking.
People move through life - their needs change.
The people in their 20's might like a small, sporty car, but will think SUV or nice sized sedan when the family and kids come.
At eighteen you are planning how to afford a Honda Civic - at forty or fifty it might be a Lexus (aside from this crowd!)
People like to feel they are moving up, too - just ask a kid over six years old if they like Barney any more!
The one thing they DO remember is Quality - when I moved beyond a Datsun 510 I bought a Datsun 280ZX because I remembered the quality of the car, but looked for another level. When I moved beyond my 1973 Dodge Dart I remembered the quality of that car and have never bought another Chrysler. Don't even ask.
Good service and good quality will never hurt you in consumer minds, no matter how old they get -it just gets more important.
People move through life - their needs change.
The people in their 20's might like a small, sporty car, but will think SUV or nice sized sedan when the family and kids come.
At eighteen you are planning how to afford a Honda Civic - at forty or fifty it might be a Lexus (aside from this crowd!)
People like to feel they are moving up, too - just ask a kid over six years old if they like Barney any more!
The one thing they DO remember is Quality - when I moved beyond a Datsun 510 I bought a Datsun 280ZX because I remembered the quality of the car, but looked for another level. When I moved beyond my 1973 Dodge Dart I remembered the quality of that car and have never bought another Chrysler. Don't even ask.
Good service and good quality will never hurt you in consumer minds, no matter how old they get -it just gets more important.
03-28-06, 07:43 AM
#7
Lexus Fanatic
Originally Posted by SilverLady
When I moved beyond my 1973 Dodge Dart I remembered the quality of that car and have never bought another Chrysler. Don't even ask.
Good service and good quality will never hurt you in consumer minds, no matter how old they get -it just gets more important.
Good service and good quality will never hurt you in consumer minds, no matter how old they get -it just gets more important.
)They routinely went 150,000-200,000 miles in an era when the average car was worn out at 90,000-100,000 miles...or earlier.
Last edited by mmarshall; 03-28-06 at 07:46 AM.
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03-28-06, 10:09 AM
#8
Originally Posted by mmarshall
As usual, Spinella is way off base...he has never impressed me.
Toyota had better keep the Camry in production. In 10 years those " young " people won't be so young anymore. Besides, there are a fair number of young people driving Camrys NOW.
Toyota had better keep the Camry in production. In 10 years those " young " people won't be so young anymore. Besides, there are a fair number of young people driving Camrys NOW.
Scion has lowest median buyer age in the car industry - even when parents are signing kids leases....
I mean wow,scion failure? darn. There has been no such sucess in recent Automotive history.
03-28-06, 10:13 AM
#9
to add a bit more - scion has:
1. lowest median age in the industry
2. lowest days to sell in industry
3. lowest average incentives in industry
And scion has reached its sales goals 2 years before, and now is selling some 40% better than what they ever hoped for. Scion an failure? Damn. I just cant get over that.
1. lowest median age in the industry
2. lowest days to sell in industry
3. lowest average incentives in industry
And scion has reached its sales goals 2 years before, and now is selling some 40% better than what they ever hoped for. Scion an failure? Damn. I just cant get over that.
03-28-06, 11:11 AM
#10
I agree with with what has been said. All of those kids driving around in their 'tegs and Civics will probably NOT being driving those cars forever. I remember in high school I wanted a Trans Am or Camaro so much. I thought these cars were so great I would drive them forever. More than 10 years later and I have passed up on several F-bodies and ended up with a GS400 as my performance machine. Never would have pictured that back then.
One could even say the Camry is a perfect 1st car as a parent. Not as much aftermarket performance parts as the others. Decent on gas, not really that fast, very reliable and decent size.
One could even say the Camry is a perfect 1st car as a parent. Not as much aftermarket performance parts as the others. Decent on gas, not really that fast, very reliable and decent size.
03-28-06, 11:39 AM
#11
To be really honest...I think the new Camry is a step in the right direction for Toyota. I had some friends with me the other day and while we were waiting to pick my car up from service, went up and checked out the new Camry. They had two SE's, a dark grey and silver one, and both went over quite well. One friend drives a Trans Am, one an Accord Coupe, and the other a Sentra SE-R. All were talking about how good the car looked, how sporty it had become in comparison to the older generation, but none of them could believe that it was packing a 268HP V6 that could give all of them a run for their money.
I'm 18 now, and I'd gladly drive a new Camry SE V6. I don't know that the '06 would be on the top of my list, but the '07 is really a different animal.
I'm 18 now, and I'd gladly drive a new Camry SE V6. I don't know that the '06 would be on the top of my list, but the '07 is really a different animal.
03-28-06, 01:37 PM
#12
Originally Posted by mmarshall
Well...you're partly right. Chrysler products of that era had poor quality control and sloppy body, trim, hardware, and paint, but you can't fault the durability of those old Chrysler drivetrains....the slant-6 engines, 318 V8's, and Torqueflite 3-speed automatic transmissions were like iron.....equivalent to Toyota's best drivetrains today. ( like the Camry )
They routinely went 150,000-200,000 miles in an era when the average car was worn out at 90,000-100,000 miles...or earlier.
)They routinely went 150,000-200,000 miles in an era when the average car was worn out at 90,000-100,000 miles...or earlier.
I saw the 2007 Camry today - looks like a nice car - big improvement. The dealer hardly sees V6's, and hasn't seen one with Nav yet. I might try one out.
I also saw and sat in the FJ Cruiser - Wow! There is no way this is a smaller Landcruiser. This is a Japanese Hummer. OK, not practical for me (and Hubby does have his limits), but I can fantasize. This is one fun vehicle. Only thing I'd day is making the digital gauges (like the compass) shaped like the old analog type is a bit corny, but this SUV is so cool I'll give it a pass.
03-28-06, 05:09 PM
#13
I'm seeing a fair number of younger kids driving and fixing them up. With some tasteful mods, it is a pretty nice looking car. IMO
Next door neighbor had a friend visiting that had a modest body kit, HID's, 18's, dropped to the top of the tires, all chrome/trim blacked out and a modest muffler. (Not the coffee can syndrome) Looked good IMO. Also saw a new Avalon that had been dropped with 19's.
With a bit of vision, I think Toyota could adverstise these cars like the Scion. That might change the way the youth view these family sedans. After all, enough of us have done this with Lexus.
Next door neighbor had a friend visiting that had a modest body kit, HID's, 18's, dropped to the top of the tires, all chrome/trim blacked out and a modest muffler. (Not the coffee can syndrome) Looked good IMO. Also saw a new Avalon that had been dropped with 19's.
With a bit of vision, I think Toyota could adverstise these cars like the Scion. That might change the way the youth view these family sedans. After all, enough of us have done this with Lexus.
03-28-06, 06:55 PM
#14
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I think the Camry has plenty of shelf life left, and Toyota makes it a point to keep their products relevant. It's tough to ignore.
- class leading V6 power
- class leading V6 fuel mileage
- class leading performance
- class leading stereo
- a 6spd automatic
- an SE trim that does actually handle somewhat decently
- an interior like a Lexus (XLE)
- Toyota's top-notch quality reputation (honda no longer qualifies imo, too many blown trannys)
The new Camry is getting the Honda guys' panties all in a bunch lately.
My parents have had 4 Toyota Camrys (85 LE, 90 Dlx, 98 LE, 00 XLE) the two newest of which they still drive. I "rebelled" to Honda and was uttlerly disappointed and then gave Nissan a try. Not bad, but not really convinced to buy another one though. Our Toyota has been flawless though, and I know we'll probably own more Toyotas down the road for sure. I think most people out there are after practical, reliable, cost-effective transportation that will not let them down and not leave them with huge repair bills out of warranty, and Toyota by far has the best reputation of doing that. They might not be the most exciting cars, but to most Americans out there that are struggling to pay bills, support kids, and pay a mortgage, it comes down to a good practical car just like the Camry. It's the car you NEED, not the car you want.
- class leading V6 power
- class leading V6 fuel mileage
- class leading performance
- class leading stereo
- a 6spd automatic
- an SE trim that does actually handle somewhat decently
- an interior like a Lexus (XLE)
- Toyota's top-notch quality reputation (honda no longer qualifies imo, too many blown trannys)
The new Camry is getting the Honda guys' panties all in a bunch lately.
My parents have had 4 Toyota Camrys (85 LE, 90 Dlx, 98 LE, 00 XLE) the two newest of which they still drive. I "rebelled" to Honda and was uttlerly disappointed and then gave Nissan a try. Not bad, but not really convinced to buy another one though. Our Toyota has been flawless though, and I know we'll probably own more Toyotas down the road for sure. I think most people out there are after practical, reliable, cost-effective transportation that will not let them down and not leave them with huge repair bills out of warranty, and Toyota by far has the best reputation of doing that. They might not be the most exciting cars, but to most Americans out there that are struggling to pay bills, support kids, and pay a mortgage, it comes down to a good practical car just like the Camry. It's the car you NEED, not the car you want.
