Originally published: Jan. 21, 2008DETROIT -- The Detroit 3 tried to "destroy" the launch of the Toyota Tundra last year by adding incentives to their own full-sized pickups, says Toyota's top U.S. executive.
But in the end, General Motors, Ford Motor Co. and Chrysler LLC probably only hurt themselves, says Yuki Funo, CEO of Toyota Motor Sales U.S.A.
"It wasn't worth it," says Funo, for the Detroit 3 to try to slow Toyota from increasing Tundra sales from 100,000 units to 200,000.
"It's 30,000 units for each of them," he said. "It's just a splash when they each sell 500,000 or 600,000 units."
And Funo reckons that Ford and Chrysler's Dodge brand may have damaged their ability to sell redesigned pickups they have coming this fall.
He says heavy incentives on the F-150 last year may have made it difficult for Ford to add content to the new version that debuted last week at the Detroit auto show.
Toyota Tundra: $31,063
Ford F-150: $27,430
Chevrolet Silverado 1500: $26,990
Dodge Ram: $25,608
Note: Tundra includes CrewMax; Ram includes Mega Cab
Source: Power Information Network
Dodge has made big changes on the new Ram, such as replacing rear leaf spring suspension with a more expensive coil spring design. But Funo says that means Dodge will have less price margin for incentives that customers have come to expect.
Meanwhile, he says, GM's willingness to spend big money on a 1-year-old Chevy Silverado will hurt the truck for the rest of its life cycle.
In 2007, incentive spending in the full-sized pickup segment rose 12 percent, even though incentives dropped slightly industrywide, according to the Power Information Network.
With inventory sell-downs coming at Ford and Dodge, Toyota Division General Manager Bob Carter predicts that "the incentives spend is going to get expensive" in the first half of 2008.
Funo says news reports that trumpet Toyota's incentive spending on the Tundra are inaccurate, but not necessarily harmful.
"I know how much we are spending," he says. "But if the newspapers say we're spending more than that, and it increases customer interest, more people come into the store."
Funo says Toyota won't chase sharply higher Tundra volumes in the near term. Toyota has capacity at its plants in San Antonio and Princeton, Ind., to build 280,000 Tundras. But he says the plants are not staffed to reach that level.