Toyota's Depew on Fleet Sales in 2018
Photo of Depew courtesy of Toyota.
Toyota celebrated its 60th anniversary in the U.S. on Oct. 31, 2017 by commemorating the formation of Toyota Motor Sales U.S.A. on Oct. 31, 1957 in California.
On the eve of the 60th anniversary, Automotive Fleet was invited to tour the recently opened, all-new headquarters for Toyota Motor North America (TMNA) in Plano, Texas, which was designed to create more unified operations of its North American business units.
Upon conclusion of the tour, AF took the opportunity to interview Dave Depew, general manager, fleet sales for Toyota Motor North America, to get an update on the company’s fleet sales initiatives in the U.S.
Below are excerpts of the interview.
AF: Could you provide an overview of the business functions that were relocated to the new corporate headquarters in Texas?
Depew: Toyota’s “One Toyota” vision for its new headquarters is to create a unified operation in North America, in part, by bringing together its quality engineering & manufacturing; sales and marketing; financial services; and corporate functions all into one location. These were previously four different companies:
- Toyota Corporate Function: This includes accounting, human resources, etc.
- Engineering and Manufacturing Functions: Toyota Motor Engineering & Manufacturing North America (TEMA) in Erlanger, Ky., has consolidated with TMNA, which includes demand planning, logistics, parts distribution, and related functions.
- Sales and Marketing: This includes sales and marketing for both Toyota and Lexus divisions, formerly known as Toyota Motor Sales (TMS), which is now part of TMNA. Also included are sales operations, dealer support, strategic planning, and media planning.
- Toyota Financial Services (TFS): TFS provides automotive financial services to Toyota customers and dealers in the U.S.
The opening of our new headquarters in Plano is an extraordinary next step in Toyota’s 60-year journey in the United States, with team members from the four different companies now together in one campus location. We believe this will inspire greater collaboration, innovation, and faster decision making as we turn to and lead the future of mobility, all with an eye on our customers.
AF: Are there additional advantages to centralizing Toyota’s various corporate facilities into the new corporate headquarters?
Depew: By unifying our headquarters in Plano and expanding our technical center in Michigan and production engineering facilities in Kentucky, it will help Toyota better serve customers and achieve sustainable, long-term growth.
With all affiliates together, Toyota is better equipped to speed decision making, share best practices, and leverage the combined strength of our team members.
This is the next step toward becoming “One Toyota” and builds upon previous moves we’ve made to enhance regional autonomy, self-reliance, and responsibility.
AF: How would you characterize Toyota sales in the commercial fleet market year-to-date for calendar-year 2017?
Depew: Toyota’s commercial sales have declined 20% calendar year-to-date. The CYTD decrease is due to commercial customers waiting to order the 2018 model-year Camrys, Tacomas, and Siennas all of which now feature automatic braking, pedestrian detection, and the entire Toyota Safety Sense technology features as standard equipment.
AF: What is Toyota’s sales forecast for the commercial segment of the fleet market for 2018?
Depew: We forecast slow and steady growth, just like 2017. However, this is a tough question to answer with everything going on in Washington, D.C. If a tax plan passes, the commercial segment stands to benefit. Companies, like consumers, want to know tax policy and its impact on their operations.
AF: What has been the fleet reaction to the all-new 2018 Toyota Camry?
Depew: Commercial orders for the all-new 2018-MY Camry are up 25% for the first eight months of the model-year. Customers like the look, MPG, performance, and connectivity.
AF: What are the early results of the new OTD initiative of using expanded ePools for the 2018 Camry?
Depew: Toyota’s two most popular Camry commercial models, LE gasoline and LE hybrid, both have improved order-to-delivery times versus a year ago.
AF: How are sales progressing for the new Toyota Prius Prime?
Depew: Toyota has sold over 16,500 Prius Primes through October 2017. Of which, more than 500 have been sold via fleet.
AF: What are the key trends you see emerging from commercial fleets in terms of product selection?
Depew: There is more demand for small and mid-SUVs to replace sedans. With increased utility and minimal MPG penalty, SUVs are very popular. Also, companies with corporate sustainability initiatives to lower CO2 emissions continue to look closely at hybrids and alt-fuel vehicles.
AF: Could you provide an update on the fleet reaction to the Toyota Safety Sense active safety package now being standard in almost all 2018 models?
Depew: The customer response to Toyota Safety Sense as standard equipment across its 2018 lineup (excluding 4Runner and 86) has been very positive. Safety continues to be a key purchase consideration for fleets. Toyota’s is well positioned to take advantage of the demand.