Toyota Is Thrilled Ford And GM Are Giving Up On Traditional Cars

Dec. 03, 2018 11:45 AM ET by Jay Traugott / 10 Comments

There's a void to be filled.

It was last spring when Ford announced its traditional car lineup, specifically the Fiesta, Focus, Fusion, and Taurus, will all soon be discontinued. No direct replacements are planned. Aside from the Mustang, Ford North America will focus on trucks, crossovers, and SUVs. GM made a similar decision last month as the Chevrolet Cruze, Impala, and Volt will also soon be goners. Even the Cadillac CT6 flagship didn't survive the cut. But Toyota isn't sad. In fact, it's thrilled two of its biggest rivals will soon be out of the sedan segment.

Automotive News spoke with Toyota North America's senior vice president of automotive operations, Bill Fay at LA last week and specifically asked why Toyota is still bullish on sedans.

"There are still people out there looking for passenger cars," Fay said. "And if there are less options out there in the market, I guess we can figure, for now, that's good for us." Fortunately, Toyota is making good use of its Toyota New Global Architecture (TNGA) for more new vehicles, thus offsetting costs. "The TNGA platform as a strategy has opened us up to just about everything that a manufacturer would want to be," said Jack Hollis, general manager of the Toyota division.

The new Camry and Avalon are both built on TNGA, as is the just revealed 2020 Toyota Corolla sedan and hybrid. Even the RAV4 shares this platform. As we previously reported, minority customers, particularly Latino buyers, still prefer sedans over crossovers, and the new Corolla will be marketed accordingly.

Another benefit of the new Corolla hybrid is that underneath its skin it's nearly identical to the Prius, giving Toyota yet another high-volume model to help meet fuel economy standards. However, Toyota has also experienced reduced car sales lately in the US. For example, Prius sales are down 17 percent through last October, the Camry is down by 6.1 percent, and Corolla by 11 percent. One way Toyota is countering that is by trying to get customers to buy more profitable, higher-margin models, such as the Camry SE and XSE. There's also the upcoming Camry and Avalon TRD models and Toyota's NASCAR presence, which it hopes will translate to sales as well. And with Ford and GM soon out of the picture, Toyota has every intention of filling the void.

Toyota Is Thrilled Ford And GM Are Giving Up On Traditional Cars

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