3rd-generation Camry took Toyota to a new level in '92

It was a scene that would have been worth the price of admission: Bob McCurry, the blunt-spoken executive vice president of Toyota Motor Sales U.S.A. looking at the initial designs for the 1992 Camry and demanding that Toyota make changes.

It was 1989, a year after the first-generation Camry had gone into production in Georgetown, Ky., and just before the Lexus brand was to launch. The Japanese executives were confident about their performance in the United States to that point — but then they had to face some tough talk from their top U.S. executive.

McCurry wanted a vehicle suited to American tastes, not the traditional low-key Japan-sized model he saw in the designs. There is no explicit record of what the Japanese had to say about McCurry's forceful way of making demands — a dramatic departure from the way things typically were done in Japan. Yoshio Ishizaka, senior vice president and chief coordinating officer of Toyota Motor Sales U.S.A. at the time, says only: "Some were very much offended by McCurry's comments. Americans like a big car. Always, American opinion is the bigger, the better. That's a very simplified argument."

McCurry later told the Los Angeles Times that he didn't think his direct approach really bothered the Japanese. "I'm a dealer-oriented guy," McCurry told the paper, "and that was a new arena for them. The aggressiveness didn't bother them. They learned a new mode of operating, and I think they respected that."

The Japanese staff might have gotten used to McCurry's style, but the push and pull over the Camry took its toll.

"We really stressed out the chief engineer," says Chris Hostetter, 52, vice president of advanced product strategy and product planning at Toyota Motor Sales U.S.A. "I think we worked him into a heart attack or a stroke or something. We dragged these guys out and took them on dealer visits and midnight focus groups. Then we'd grind them on the concept back at headquarters."

The U.S. staff wanted a premium product, according to Hostetter. That meant it had to be wider to allow for the styling and aerodynamic shape they wanted. "That caused Japan heartache because Japan has width restrictions," he says. "So we had two widths of cars — for Japan and for the U.S. We also campaigned for a 3.0-liter V-6. All the competitors were V-6-only or V-6-dominated. So we upgraded the V-6 and had a four-cylinder with balance shafts with good fuel economy and performance."

Ishizaka worked to persuade his colleagues in Japan to listen to the American argument. "It was kind of a long, tiring persuasion," the 67-year-old recalls.

He told the executives in Japan: "If you look at the car, it looks a little big for Japanese. But if you put the car under the California sun, with a big landscape, and then if you look at it from a distance, the car matches the landscape well."

Even though the Japanese had been hearing the same argument for more than 30 years, it took lengthy discussions to get the Japanese to recognize that roads in the United States are wider than they are in Japan and that people drive longer distances at higher speeds.

"In a way, I think it was really difficult for the chief coordinator to smooth out both sides of opinion," Ishizaka says. "However, we worked very hard to fill the gap between the two sides."

Akihiro Wada, now 73 and the retired head of r&d at Toyota Motor Corp., was involved in the technical discussions about the Camry and the effort to meet the demands from the American side. The initial model presented what Wada called "a Japan-market five-number car."

"It was too narrow and not suited for the United States," he says. "The engineering problem was the cradle, or engine bay, holding the motor. For America, we had to cut it in half and widen it. The chief engineer proposed some very difficult designs. I made lots of comments."

It was not a matter of not understanding what the Americans wanted, according to Wada. "All chief engineers understand American tastes," he says. "Americans are very frank. But the engineering to meet those tastes was very difficult."

Bryan Bergsteinsson, now 62, who worked at Toyota Motor Sales U.S.A. for more than 25 years in a variety of roles, including product planning, calls the 1992 Camry "the maturing of TMS." He credits McCurry and Yukiyasu Togo, then president of Toyota Motor Sales U.S.A.

"Bob and Yuki were two dyed-in-the-wool sales guys," Bergsteinsson says. "They did a lot of table pounding at TMS as to what we needed. Bob may have made people uncomfortable, but they respected his credentials and knowledge. And the dealers paid attention to him. TMC recognized and appreciated that."

Fritz Hitchcock, a Toyota dealer in Southern California since 1976, says McCurry and Togo "really made a difference in kicking Toyota to the next level."

"I imagine slowly but surely they would have gotten there," he says. "But I think Bob's determinedness and Yuki's enthusiasm really got the Toyota board cooking pretty darned hard to get cars that would sell here, whether they sold in the home market or not."

The 1992 Camry, Hitchcock says, broadened the appeal of the Toyota brand and let people see that Toyota could compete with the Ford Taurus and other U.S. products. Three weeks before the car went on sale, AutoWeek magazine put it this way: The Toyota Camry is "aimed at the enormous American mid-sized car market the way a sawed-off shotgun is aimed at the broad side of a barn: to hit as much of it as possible."

The new model was bigger, wider and longer than its predecessor. The wheelbase increased by 1 inch, the width by 2 inches and the length by 6 inches. The engine was enlarged to 2.2 liters with 130 hp, and the V-6 went to 3.0 liters and 185 hp. The new Camry finally could do 0 to 60 mph in less than eight seconds.

The car came with a long list of standard equipment, more than the domestic competition, according to Hitchcock. "I think it opened the public's mind to consider a Toyota product," Hitchcock says. "It brought in domestic buyers who never considered buying Toyota before. It got them away from thinking they could only buy American."

Sales did not immediately leap with the 1992 model. But the Camry enabled Toyota to make slow, steady gains in a down market. "Everyone was worried because it was a significant price-up, and all the naysayers said, 'How we gonna do that?'" says Ed Ohlin, 56, a longtime product planner who now consults for Toyota in China.

The base price of the 1992 Camry jumped $2,620, to $15,093. The base V-6 model increased by $1,580.

"What I remember is the intense consternation over how we were going to do this price jump," Ohlin says. "There were people at the dealer level who wanted to bring people in with a low price and then get them to pay more to equip the vehicles with more stuff or pay more in the F&I department on trade-ins. We made that leap pretty seamlessly."

The new model, Ohlin says, "tapped a vein of people who wanted all the superlatives and didn't want an Americanized version of a Japan domestic model. They wanted it aimed at the top of their needs."

Hostetter remembers that McCurry kept reminding people that no company had ever repositioned a car upmarket in a recession. "So I was very worried that we had built in too much cost," he says. "But we kept looking at DINK (double income, no kids) households and more disposable income, seeing that there was a bit of affluence. We needed to do Camry like this to develop buyers for Lexus."

The result was that Toyota was lifted from a niche player to one that would take the market head-on. The 1992 Camry impressed the competition, even at Ford Motor Co., according to Hostetter, a former Ford man.

Ford was still reveling in the success of the Taurus, but "this car shocked Ford," he says, "because quality went up by so much."

"It was a difficult price range, but that was where the buyers and market were going," Hostetter says. "That established the Camry brand. It was a hidden secret that this was a Lexus. It even had the hydraulically powered fans that we borrowed from the ES 300. There were some who said the 1992 was too big an improvement and step up. But we wanted to make a total commitment to the car."

In 1997, the Camry outpaced the Taurus, becoming the top-selling car in America.

It was never that popular in Japan — too Americanized, some said.

"I think it was not so much taste as sheer size," says Yoshimi Inaba, 61, retired CEO of Toyota Motor Sales U.S.A. "The American standard is so much bigger and so different from that of Japan."

The 1992 model didn't fit the Japanese market, but it found other homes, such as China and Russia, says Inaba.

The 1992 Camry changed the way Toyota did business in the United States, according to Tatsuo Hashiguchi, now 74, who worked 38 years at Toyota Motor Sales U.S.A.

"Toyota started selling 1 million cars, and then American companies were saying we were dumping, so we had to build in the U.S. and use U.S. labor, parts and steel," Hashiguchi says.

"We had to bring the technology to the steel companies. Ours was thin enough, strong enough and it lasted; it was easy to paint. The U.S. didn't have it, which is why we imported our own steel.

"But the Americans said Japan was dumping, so we had to give our technology to them. That was a change that we had to do. Now nobody can complain because we are using American parts."

The first two generations of the Camry imported to the United States were world cars, Hashiguchi says, but "when we made a domesticated product, that's when we really had made it."