Hidden behind the headlines about May's modest new vehicle sales results is the fact that Toyota Motor Sales had an extraordinary month. With replenished inventories of core models, both the Toyota and Lexus makes had "break-out" months. Together the two brands captured 15.2% of the U.S. market in May, up five percentage points from May 2011. To put that in perspective, Toyota's gain in May was equal to the entire U.S. volume of the Hyundai make in the same month.
Toyota dealers delivered 181,510 new cars and light trucks in May, up 89% from a year ago and more than any make in the industry except Ford. Camry sales more than doubled to almost 40,000 units, and it out-sold its nearest competitor, the Accord, by almost 10,000 units. Sales of the Prius family of cars, including the "original," the plug-in, the value-oriented "C" and the spacious "V" version, more than doubled to 21,477 units. In May, the Prius was the fourteenth most popular vehicle in the country, ahead of the Hyundai Sonata and Chevrolet Cruze, among others.
Lexus captured 1.6% of the new vehicle market in May, up a third from a year ago and only 705 units behind last year's luxury leader, BMW. In January, Lexus deliveries were just 75% of BMW sales (see chart). Lexus has also made progress against Mercedes-Benz, though the Japanese make has failed to get within 10 percentage points of Mercedes-Benz's results this year. Lexus's core strength remains the midsize premium crossover RX Series; this model alone accounted for close to half of all Lexus deliveries in May. RX sales were up 82% from a year ago, and the RX by itself out-distanced all three of BMW’s crossovers, the X3, X5 and X6, by 53%; the RX also out-sold the redesigned Mercedes-Benz ML-Class by more than 200%. With its huge owner body, frequent redesigns and competitive pricing, the RX remains the undisputed leader in the premium crossover space.
As Toyota and Lexus both surged in May, others suffered. GM's market share slid by almost two and a half points and Ford's declined by a point and a half. Hyundai and Kia each lost a half a point or more, and Nissan slipped as well. Only Chrysler and American Honda were spared the effects of Toyota's move forward.
New product launches are the key to Toyota’s resurgence. The recent introductions of the redesigned Toyota Camry and Lexus GS as well as the Prius V and C have played a big role in the company’s success. Looking ahead, Toyota, Lexus and Scion will be blitzing the market with a barrage of updated cars and light trucks. By the end of the 2013, we will see redesigned versions of the Toyota RAV4, Tacoma, Highlander, Avalon, Corolla and Sequoia as well as the Lexus ES and LS and Scion xb and xD. (It might be easier to just list the models which are not being re-designed.)
Polk has incorporated Toyota's recent success and upcoming product offensive into its U.S. light vehicle forecast. Our forecast is that Toyota and Lexus will account for 12.9% and 1.6%, respectively, of the U.S. new vehicle market in 2012. By 2015, these two makes' shares will have climbed to 13.8% and 2.0%, respectively, and Toyota will be the most popular make in the country and Lexus number three in the premium market.
Given Toyota's public humiliation in 2010, its vows to regain lost ground in the U.S. Based on its vast resources and the display we have seen in May, it's easy to envision an escalation of incentives across much of the industry in the near future as competitors try to slow down the Japanese giant. In one form or another, Toyota's influence on the U.S. light vehicle market in the coming months will be profound.
Posted by Tom Libby, Lead Analyst, North American Forecasting, Polk (06.12.2012)