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Report: Toyota to Emphasize Production of Smaller Cars in US

14 September 2006

The Asahi Shimbun reports that Toyota will shift its strategy for the North American market to fuel-efficient small and mid-size cars in response to high gasoline prices and a slowing US economy.

As a result, Toyota will operate its new Texas plant—which produces the full-size Tundra pickup—at less than full capacity initially, according to the report. Output in 2007 is planned to be about 150,000 units, down from the capacity of 200,000.

Toyota will double production of the Camry to 200,000 units a year with production support from Subaru’s Indiana plant. Subaru Indiana is the US subsidiary of Fuji Heavy Industries, in which Toyota took an 8.7% stake last October. In addition to the Camry production at the Fuji Heavy subsidiary, Toyota’s second plant in Ontario, Canada is scheduled to be completed in 2008.

After US production of the Camry doubles in October 2007, Toyota plans to stop exporting the model to North America from Japan, according to the report. The Tsutsumi plant in Toyota, Aichi Prefecture, which makes the Camry for the North American market, will instead increase production of the Prius gas-electric hybrid for export to North America.

September 14, 2006 in Fuel Efficiency, Market Background, Vehicle Manufacturers | Permalink | Comments (26) | TrackBack (0)

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Outstanding!! A way to produce more Prius. Now maybe we can actually catch one on a lot, waiting to be sold!

Does this mean we'll get the Aygo? surely they can't ask more than $12,000CAD?

In other news, the big three announced they will continue to produce even bigger less efficient cars, lose more market share, and post bigger losses.

I wonder if the Big 3 are conducting more "studies" to find out what the people really want in terms of cars! Hint: FUEL EFFICIENT cars that doen't look like toys! Oh, and how about a bringing the electric car back into production?

This is great, but what if gas prices go down and stay down?

"This is great, but what if gas prices go down and stay down?"

Toyota's actions are saying they don't believe this is going to happen. Conventional widsom seems to be that oil prices are never going back down to $20-30/bbl again as they always have in the past. Do you think there's a change they could?

Honda has done quite well by always producing small fuel efficient vehicles even when gas was below $1.50/gallon.

Even if they could drastically drop the price of oil to below $40/barrel OPEC is unlikely to let supplies do that since they know people keep on buying with out the slightest hesitation all the way up to $78/barrel. If oil starts to get close to $50/barrel they will have sudden supply problems here and there guaranteed. There would have to be a sudden incredible breakthrough that replaces a very large portion of oil use within a 10 year time frame before oil drops appreciably and at that point the price of oil will be largely irrelevant.

In the future, I see a car that uses an electric generator engine designed from the ground up that runs initially on alcohol in a narrow rpm range; think about it; it could run leaner at a higher compression ratio and would be more efficient because it would not depend on a cat and the current 14.7 air to fuel ratio. I see a mid-size car made of carbon fiber from the chassis to the fenders, with four hub units that include the electric motor/brake/generator/suspenion/steering systems (no gears), plug in battery pack and standby ultracapacitors for quick power response with a super smart control unit. Such a car might easily get 200mpg. And, it will be designed for DIY maintanence. A unit blows; you replace it; when fuel cells become available; you replace the alcohol motor. Then who cares what "big oil" charges for their dirty oil?

Perhaps Googles recent involvement in developing a new auto engine will lead us to this ultimate car.

Price of oil WILL NOT do down but for otherwise short periods of time, and that’s only in respect to current prices. With oil production already peaked in most oil fields and middle east oil on the decline, it doesn’t matter how much oils reserves we find, we are consuming oil way too fast. You can forget $1/Gallon gasoline! We have seen an increase in gas prices since 97-99. When do you think it's going to start going down? The Big 3 have acknowledged that, and the foreign auto makers have designed their products accordingly. It's here to stay and most likely get worse. Production of renewable fuels is limited and will never supply the world at present consumption rates. Let's not even mention the global warming that is plaguing us currently. Let's get electric vehicles on the road for those of us ready for them. Those are rechargeable through solar panels, wind, and a host of other clean methods. The age of oil is coming to an end, why is Big 3 trying to keep it alive?

Ladson, one problem: Alcohol based engines are stochiometric at an air to fuel ratio of 9.6:1 which is quite a bit richer than gasoline use. I would like to see what could be done with alcohol direct injection.

Anyone who thinks that the oil prices will remain low is living in a dream world. It just isn't going to happen. Energy makes the world go around and as other countries develop, they will be needing it like we do and we are presently burning 25% of every drop of oil that is taken from the ground around the world each day and importing over half of it. I think that this temporary lowering of the oil prices is just the calm before the storm.

adrianakau@aol.com

Compare Toyota with Ford / GM.

Oil jumps over 60 bucks a barrel.

GM lays off tens of thousands... the stock dives... sales of trucks dive. And their answer? The Aveo:
26 mpg city / 35 mpg highway

Ford lays off tends of thousands... stock dives.. sales of big trucks dive. And their answer? The Focus?
city:26 / Hwy:35

Toyota... cuts down production in one plant. Ups production in another plant. And continues work on its PHEV.

Bye bye Ford

Nice to know you GM.

Good riddance.


Combined market caps for Ford & GM are 40 billion. Its not that big a deal....

Plus when all those Michigan workers move to Wyoming to shovel coal. We might get another blue state.

Matt

The 2007 Focus gets 27 city 37 highway. Highway mileage (with manual) nearly matches the Civic's 38mpg.

I am still 50:50 on the chance that Toyota will introduce a PHEV as opposed to an improved HEV.

Actually, some experts do think oil is presently over-priced by a lot due to speculative fears of political or weather related disruptions to supply. The more time that passes with that not happening, the more likely it is that all the speculators bail out and the price collapses. By a strange coincidence, all the news media were full of just this story today, complete with predictions of the return of $1.15 gas:

http://www.miami.com/mld/miamiherald/15513467.htm

Classic case of reporters not fully understanding the news they relay. $1.15 per gallon would not be the price at the pump but the price that refiners are selling the gas at before taxes and any middle men get their hands into it. Just like right now gas is around $1.75 per gallon...but at the pump it is around $2.65 on average.

Toyota Camry is excellent car, no question aboutit. But it is big enough to accommodate even NBA player, weights more then 1500kg, and even theoretically could not use in full 268hp 3.5l engine mated to 6-speed automatic due to limitations of FWD and soft suspension/tires setting (which is appropriate to family sedan). This car is too much. I am not to dictate to people what to buy, but do not claim that Camry is “small” and fuel efficient.

I would not comment on Corolla before Toyota will release new model to catch up with vastly improved Civic. But small Yaris is, excuse me Yaris owners, junk. Styling is the matter of taste, and rear torsion suspension is natural to small hatch, but look:
It weight sizeable 1050 kg. It is unproportionally tall, with high centre of gravity and big frontal area. Engine is weak for a weight – 106 hp, which is produced at 6000 RPM – for 375cc cylinders it is level of 1960. Peak torque of 103 lb*ft is produced at 4200 RPM, which is way to high of RPM. As any underpowered for weight car, automatic transmission carries high fuel consumption penalty compare to manual (most of the cars sold in US have automatic). Rear drum brakes, oversoften suspension, steel wheels and brake calipers, poor tires, lack of light alloys parts, etc., just add to equation. Honda Fit is not much better. Both cars will have quite small share of US market, and not because they are small, but because they are crappy. The only good small hatch on US market is Mini, and this is the shame for Japanese carmakers.

Andrev - are you sure that this is the right forum for you?

I bought a 93 tercel in 95 and still have the car. I bought a 96 tercel 2 years ago because I liked the first one so much. Both get over 40mpg on the highway. I was thinking about trading the first one in on the new yarus, but with this news I think i'll wait to see what they do. I really like small toyotas and i hope they show us something great.

Scott 58:
Tersel was incredible car. With weight of about 900kg and 100hp DOHC engine it has better power/weight ratio than Yaris. For realiability it was absolute champion. Low profile and short wheelbase made this car agile in city traffic and stable at high speed. It was the car of preference for owners/operators of delivery vehicles, which says a lot. The only drawback was 3 speed automatic. I suggest you test drive Yaris, but do not expect a lot. Also try Echo hatchback (and only hatchback), it has about same engine, is lightweight, and is maneuverable and easy to handle in city traffic.

I am a big fan of small vehicles too, and very disappointed in new offering in small vehicle market in Us/Canada.

Mike Wendl:

Unfortunately, small car offered in US/Canada use outdated technology, which force buyers to move to bigger and more sophisticated vehicles. Moreover, owners of old-time small vehicles with high-tech twist (like me) tend to retain these vehicles because there are no alternatives. If someone produce vehicle comparable to my NX2000, I will buy it in a blink, and save 15% in fuel due to progress in engine technology. Meanwhile I will stick to my 15 years old car (2l 140hp@6300 RPM, fully independent suspension, all disk brakes, hatchback, alloy wheels and 55 apex tires standard , 4 speed automatic, actual 9.5/8 l/100km fuel consumption).

Andrey, There is also a problem of perception in the US. Because the cars are low cost and small Americans perceive them as entry level "crappy" cars and so they are configured as such because it is difficult to make a profit on them with a decent setup.

BTW- The Mini with the base model 1.6L is way underpowered considering it is about 1200kg. I achieve better acceleration and gas mileage in my small car (which was around 1050kg stock but around 975kg in current configuration).

In the 11 years I owned the 93 tercel (4speed manual) I have less then $2000 in maintenance (includeding oil changes, Mobil-1 only). I've logged 110,000 miles. The 2 years with the 96 (nighthawk automatic) has only had oil changes (Mobil-1 again) and a set of tires. After adding a Honda Rebel (234cc 80 mpg) and a suzuki boulevard S50 (800cc 55 mpg) to my personal fleet I could actually keep all vehicles about 20 years or better without replacement. If I do decide to get the yaris it will be the 5 speed manual 2 door and it will probably be one of the last cars I ever own (provided of course it's as good as tercel.

Scott58,
That is indeed a "fleet". This has to be for more than one person...

I would say if you took the Yaris and degraded the emissions equipment such that it matched the Tercel you would probably remove around 20-30lbs (9 to 13.6kgs) of weight and increase power by 2-3hp. The reclining rear seats, side & curtain airbags, and ABS are probably all worth an extra 50lbs (22.7kgs) of weight over the Tercel which has none of these items. But comparing the two is a good exercise in defining the difference that Cd improvements make versus frontal surface area. The improved Cd & engine combined with larger frontal surface area of the Yaris versus the Tercel which achieves the same highway gas mileage numbers with a much worse Cd & engine only due to the smaller frontal surface area. I would personally love to have a Yaris with the smaller size of the Tercel. It can remain the same weight due to safety equipment, keep the current engine, keep the current Cd, and just have the frontal surface area of the Tercel. That would make its highway gas mileage much improved (36mpg city shows that the engine is efficient...40mpg highway shows that the air resistance is too high for the efficiency of the engine).

Asahi Shimbun is wrong. It's amazing how false reports like these spread like a virus to so many different news outlets. I am seeing this news everywhere, even though it is wrong.

Toyota is NOT cutting Tundra production, nor is there any word that Toyota wants an additional 100K units in Camry production from Fuji Heavy.

http://transport.seekingalpha.com/article/16811

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=google&guid=%7B146E9F7F-43B6-4EF0-9545-37E192D63611%7D&keyword=

Here is showing that Toyota has denied this report.

my neighbor got killed driving a tercel It was a small accident, he hit a pole. I'll stick to full size cars and walk away everytime..

Why can Europeans buy a Toyota Yaris with a 3 cylinder 1 litre engine(with 40% better Hwy fuel economy), but not North Americans? Why does the Chev Aveo get the same fuel economy as a Chev Cavalier? I simply cannot understand why Detroit and foriegn automakers are flooding the North American market with Gas guzzlers, when they sell the same models overseas but with much more fuel efficient engines? What is going on here? My 1997 Geo Metro was rated at 66MPG (cdn) and the best Hwy fuel economy of any current non-hybrid, small car is the Yaris at 51MPG (cdn). North Americans are getting taken to the cleaners by car makers and big oil.

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