Listening to most car enthusiasts list their favorite cars that they wished they had or were looking to buy, rarely will you hear them mention a Toyota. Instead they will flaunt about sleek and stylish cars. Toyota remains the best car to own for its quality, reliability and durability. Toyota is known for making cars that don’t break down for generations, with a decent fuel economy and lesser maintenance requirements. Compared to other cars in the same class, Toyota is not as luxurious and has little to offer in its exterior and is rather simple. It is your go to option when in need of a car to simply get you from one point to the next, offering a hassle-free drive. Although one of the most purchased brand for its simplicity and affordability, Toyota cars have traditionally known to be boring cars and is said to be for those that don’t care much about vehicles.
While this might be the case, ‘boring’ has been working well for Toyota for almost five decades now. Looking at the Fortune 500 revenue ranking of the top 5 automakers since 1995, Toyota has constantly ranked as the world’s best automakers. In terms of its consolidated net revenue, Toyota continues to register an upward trajectory year after year with its increased sales volumes.
Just recently, Toyota’s president Akio Toyoda issued a company-wide decree for “no more boring cars”. According to Toyota’s chairman, the automaker’s designs were not exciting and did not spark any emotions. Something needed to change from the bland-designs description that was now Toyota. But why now? Why not produce more boring cars as they have been popular and working so well for the past 5 decades? The obvious reason being the need to make Toyota more attractive to customers but that need had always been there irrespective of the decade Toyota operated in.
One potential reason can be that in the last decade saw Toyota face competition in its niche. Korean cars started catching up in the space that was traditionally Toyota’s. They offered cheaper cars with more value and features and provided longer warranties to address any reliability issues. Basing on the fact that Toyota has established itself as the most affordable, reliable and long-lasting automobile, Korean cars seemed to have capitalized on Toyota’s popularity. In Australia, we can see this trend in recent years with Korean cars increasing in popularity. Although this could be a potential reason, it certainly is not a big enough threat for the giant automaker, at least not for the near future.
Reading between the lines, we believe that Toyota is stressing on the need for innovation. Toyota’s real threat is the innovation happening in the car industry with Tesla (and others alike) determined to disrupt the industry with futuristic technology. Whether it is the self-driving cars powered by AI or existing cars powered by electricity or hydrogen fuel, these are the areas of uncertainty and disruption that Toyota is focusing on and less boring comes as a by-product of this focus.
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