Toyota EVP Bob Carter Sees Bright Future for Tacoma, Tundra

January 24, 2019 by Ryan ZumMallen, @Zoomy575M

Bob Carter, the man charged with overseeing sales, marketing and distribution for the Toyota and Lexus brands in North America, drives a 2019 Toyota Tacoma TRD Pro – with a snorkel.

It’s the sixth Tacoma he’s owned.

He’s one of the 70 percent of U.S. consumers who have turned to light trucks – a category that includes pickups, SUVs and crossovers – over sedans. These larger vehicles are multitaskers: They offer enough fuel economy to serve as daily drivers, along with plenty of capability and cargo space for weekend adventuring.

Amid this truck-crazy frenzy, Trucks.com caught up with Carter at the 2019 Detroit auto show to discuss the growing trucks trend, how Toyota plans to optimize sales of its Tacoma and Tundra, and his views on the future of auto dealerships.

Here is an edited version of the conversation.

2019 Toyota Tacoma SX (Photo: Toyota)

On shifting demand from small cars to larger light trucks:

The industry is about 70 percent light trucks over 30 percent cars, and there’s still some room to grow. My crystal ball is not any better than anybody else’s, but once you start hitting the low 70s, about 72-73 percent for trucks and SUVs, then we’ll start seeing it plateau. Pickup trucks have been phenomenally good. Midsize trucks will be a fascinating segment. We will experience growth in midsize. We did shy of 250,000 Tacomas last year but very close to it. We see the potential there for us.

On the return of the Ford Ranger:

Back in 2015 we had 74 percent market share in midsize trucks – it was last man standing. And then Colorado and Canyon came, and the whole market expanded with the new attention. Now comes Ranger. I’m not suggesting that same percentage of growth will happen, but the segment does 550,000 sales per year versus 2.1 million sales in full-size. I think that’s where we’re really going to see that consumer gravitate. Some people that were looking at a base F-150 may find that the Ranger suits their needs. That’s what’s going to be interesting, but I promise you there will be growth in midsize. It’s just a matter of where those customers come from.

On increasing Tacoma and Tundra production:

Today we build our trucks in two locations. San Antonio is the mother plant, and it builds both Tundras and Tacomas. We have very flexible production and can build at a mix of 60/40 either way if we need more Tacomas or more Tundras. Our secondary plant is in Baja, California. San Antonio is at maximum capacity on both lines. It’s amazing; we work two shifts so max capacity is two 10-hour shifts a day. They also worked 46 Saturdays last year. Our crew loves the overtime, but we know you can’t ask people to work 46 Saturdays. To relieve some of that pressure we increased the capacity in Baja, so that’s what gave you last year’s results: maximum overtime in San Antonio and some capacity increase in Baja. But in 2020 we’re bringing our third truck plant (online), which is down in Guanajuato, Mexico.

2019 Toyota Tundra (Photo: Toyota)

On Tundra’s distant fourth-place finish in full-size truck sales:

Tundra is nearing the end of its life cycle. That’s pretty obvious. Could we have sold more Tundras last year? Absolutely. We sold about 115,000 Tundras with virtually no incentives compared to the three Detroit brands. The San Antonio plant can build 250,000 units so we chose to put it behind Tacoma, where we really had insatiable demand. With capacity being increased on Tacoma it will give us the opportunity to switch that mix back on Tundra. So, there’s more Tundra sales there. You will see continued growth in Tundra in the next couple years.

Now, Ford sold almost 900,000 F-Series. We have no aspirations to do 900,000 Tundras. But we do have aspirations to do significantly more than we’re doing now. I’m confident we can because we simply haven’t had the capacity to do it. I’m feeling very bullish about both pickups in the near future.

Editor’s note: Ford sold 909,000 F-Series in 2018.

On strong demand for adventure vehicles:

I can’t build 4Runners fast enough. We’re committed to body-on-frame vehicles. The industry, with the exclusion of full-size trucks, seems to be abandoning body-on-frame. I’m certainly not there. You’re going to continue to see us offer body-on-frame.

Take two midsize SUVs: 4Runner and Highlander. One’s body-on-frame and one’s (crossover). There’s advantages and disadvantages to both. Crossovers have become today’s family vehicles, particularly the three-row. But the 4Runner is still for that outdoor enthusiast that may have a family too. There’s an opportunity on both, and I love walking into dealerships with a Highlander and a 4Runner side by side. They’re for two different consumers.

On how dealerships will change to suit young mobile shoppers:

It’s already changing. Baby Boomers used to go to 4.5 dealerships before making a purchase. Today’s consumer only visits 1.2 dealers because all the information is online. Before the consumer even contacts the dealership, they are much further down the purchase funnel than they were just 10 years ago because customers know what they want.

Is there going to be opportunity to click a button and a car shows up the next morning? The industry is working toward that point. Will that be a big part of the industry? Probably not. The test drive, the smell, the feel is still important. But we’ve already made the shopping experience and the financing much more efficient.

If you want to push a button and see the car in your driveway the next morning, we will also provide that. But even 10 years from now the consumer is still going to want the experience. Today you have the digital world and the brick and mortar world. Tomorrow you’re going to have both, but they’ll be more seamlessly integrated.

Read Next: Spy Shots: 2020 Toyota Tundra Pickup to Get Major Upgrade

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