Toyota's Image Makeover

[Samurai]

This weekend I was visiting a relative who happens to be a Toyota executive. He was talking about new Innova and how good it is, etc. It is supposed to be unveiled on 24th. All the trims and prices will be revealed on that day.

But I asked him a question that was bugging me for a while. Why did Toyota withdraw Qualis which was doing so well in it's segment? Obviously Innova is at a different price range and segment. Why did Toyota let go the bird in hand for a bird that's on the tree.

May be some of you already know the answer, however it was good to get the fact from the source. He said Toyota was sick of being branded as Taxi vehicle provider. They didn't want to compete with Ambassadors and Omnis anymore. They wanted parity with their main rival Honda. They want to eat into Honda City market share in C segment. They are so serious about it, they are ready to sacrifice their revenue and lead in taxi cars in order to get back their image as premium car provider, like the Honda.

Personally, I think Innova will hurt Scorpio more than anything else. NHC being a 5 seat sedan isn't competing in the same segment as a 8 seater Innova.

[merve_extreme]

i heard from an autoindia Friend that Inova will cost upto 12Lacs for highest model and 8l for lowest.

[cnu]

High end innova will cost 9.5 L while low end is at 6.5 L

http://economictimes.indiatimes.com/...ow/1023266.cms

[lamborghini]

hey why dont thy launch the vios to compete with the city...
would be better for them and keep the qualis only for the taxi market and the innova for rich snobs

[Rudra Sen]

He said Toyota was sick of being branded as Taxi vehicle provider. They didn't want to compete with Ambassadors and Omnis anymore.

Could please ask him that how long did they take to understand this?
It's for my understanding Samurai. Probably it'll help me to get a better picture of Indian auto companies perspective.

Regards.

[Rtech]

Well, that's classic Toyota.

Once they commit to something, rarely do they give up without getting what they want. They are a company that is willing to sell car's at a loss in order to build a brand name and presence in a new market.

However, I see the new Innova being as big a hit with the Taxi companies just as the Qualis was. The base no frills models would be priced close to what the Qualis was priced at, so why on earth would that deter tourist car companies from buying the Innnova?

[ajmat]

Look at the strategy

1: Propogate the Toyota brand to the grass roots !
Am sure in downtown Vaniyambadi,everyone would of heard of the "Kaalis" but not many would know the "Skaaaada"

2: Understand disti/ customer issues on an Indian scale, not saturate the metro and move on to the rural market mode and end up with disjointed strategies i.e Fiat, Ford, GM

3: In terms of contrast, the Qualis as a taxi was better to be seen in than an amby or a Sumo, now that the Tavera/ old Esteems/ Indigo have penetrated, it is time to move the game on

I think you get more brand respect by replacing something good with something better - look at Honda vs Maruti

[Deeps]

I agree with rtech that if the Innova is priced around 6-7L, then its likely that this could also become the taxi operators' favorite. Its about time that toyota reworked its strategies. Apart from the qualis, all their cars have been overshadowed by their rivals in their respective segments.

[GTO]

Spot on Rtech. Spot on Ajmat.

Toyota has tested the waters, and is now coming full swing to the mass markets. By replacing the Qualis with one thats two entire generations newer, Toyota will further strengthen its position in the market . The difference between the base version of the Qualis and that of the Innova will be 60,000 - 90,000. It is yet within the range of the Chevy Tavera - Its only real competition so far.

Like Ajmat said, they are replacing something good with a better version. Something thats selling like hot cakes with one thats going to sell "hotter" than hot cakes.

In the long run, Toyota's and Honda's brand value would have taken a hit if they had continued to sell the Qualis and Old Honda City beyond tommorow. Not only would their products overlap themselves, no one would buy high end Toyotas and Hondas. Remember Maruti?

Trust me, the Innova is going to be as much as hit with the taxi crowd as the Qualis has been. Its bigger, more comfortable and two entire generations more modern. If anything, the Qualis was overpriced....not the Innova.

GTO

[GTO]

Apart from the qualis, all their cars have been overshadowed by their rivals in their respective segments.

Are you kidding? The Corolla is the number 1 in its segment. Alongwith the Qualis, that makes Toyota the top in two of the three market segments it has a presence in. The Camry merely has an ornamental presence.

GTO

[sridhar24]

with the Fortuner on its way and the innova being launched soon surely one can say how serious is Toyota on building its image here and Iam sure Toyota will be a winner.

[man23ish]

I don't think Toyota is shying away from taxi operators. Of-course no company can afford to lose the support of this vital advertisement campaign strategy.. Remember the pre-Maruti days, most Fiats and Ambys used to be run as Taxi vehicles along with the Jeeps.. Yet, the folks were proud to own the Fiats and the Ambys.. Most people atleast in India follow the market sentiment..

The taxi-drivers know which vehicle is the most profitable in terms of business and they go for the best value for money in their segment. We simply choose to imitate them.. Its like a particular vehicle is seen more on the roads so the vehicle must be good.. And then you look at the technical aspects of the vehicle before deciding to buy it.. Right??

Toyota is simply trying to elbow out its competitors (GM, Honda, et all) from the market by providing a better product at a very VFM pricing..

[amit]

What is wrong with being a hit in the taxi segment? Why is being a "taxi segment favorite" tag so demeaning? Didnt know the Japanese were so much into "casteism"!! It's good to replace a outdated car with something really modern but obviously thats not the reason for Toyota bringing in the Innova isn't it? So, this means that if private buyers would have bought the Qualis then Toyota wouldn't have bothered to get the Innova in here for a few more decades? Toyota's attitude is sickening and we still love this racist company?!?
As for image, you mean if a particular car sells as a private taxi it's not worth buying for private buyers? Taxi's are probably the worst used vehicles in any country in the world and nothing can be a better advertisement for any company then to have a model as taxi operators favorite. After all it speaks volumes for the car's bullet proof reliablity. And as for image building, does Toyota know that Mercedes are used as taxi's and police cruisers in Germany. Now, how did Mercedes manage to build their image all round the world after being a taxi/fleet operator's favorite? Toyota's attitude sucks!

[Samurai]

Originally Posted by amit

What is wrong with being a hit in the taxi segment? Why is being a "taxi segment favorite" tag so demeaning? Didnt know the Japanese were so much into "casteism"!!

Dude, you have no idea... Check this out. Anyone who has worked with or worked under Japanese companies would know that Japanese have heavy superiority complex and would not trust any non-Japanese employee beyond a point.

[ajmat]

Originally Posted by Rtech

Well, that's classic Toyota.

Once they commit to something, rarely do they give up without getting what they want. They are a company that is willing to sell car's at a loss in order to build a brand name and presence in a new market.

?

They were prepared to make a loos with the Lexus for 10 years to understand the market. Thanks god the cost of capital in Japan is 2%