Toyota dealers' message to the factory is short and to the point: More trucks, please.
Mickey Anderson, 47, president of Baxter Auto Group in Omaha, Neb., and chairman of the National Toyota Dealers' Advisory Council, said Toyota Motor Sales U.S.A. is working hard to grant that wish.
Toyota's plant in San Antonio that builds the full-size Tundra and the compact Tacoma, is running full Saturday production to generate greater pickup availability, Anderson said. And the company is putting things in place to ramp up production in Mexico for the Tacoma.
Dealers also expect to get 30,000 more Highlander crossovers out of the company's Indiana plant.
"So these are all actions that have been taken that will benefit Toyota dealers in 2016 and that will make a big difference for us," said Anderson, whose Baxter Toyota Lincoln in Lincoln, Neb., Baxter Toyota La Vista in La Vista, Neb., and Legends Toyota in Kansas City, Kan., are among his company's 21 dealerships.
Anderson, in his second year heading the Toyota dealer council, shares his views about pickups and the relationship between Toyota and its dealers with Staff Reporter Arlena Sawyers.
Q: How was 2015 for Toyota dealers?
A: It was a great year; it was a record year. We were so pleased that Camry finished as the No. 1 passenger car; Corolla was No. 2 and we had record light-truck sales for the year. Sales were up another 5 percent over 2014. We're the No.1 retail brand -- again. Dealers posted record profits. It was as good a year as we could have ever hoped for.
What major issues do Toyota dealers face this year?
The biggest issue we faced in 2015 continues to carry into 2016. For Toyota dealers it's pretty clear; we have consensus across the country that we need more trucks. Clearly, American consumers prefer more trucks. We are registering record light-truck sales. With all that said, we have great demand that exceeds our production particularly with our two pickup trucks, Tundra and Tacoma.
Any indication that dealers will get the trucks on their wish list?
There is. One thing about the dealer council is that we talk about what can be done to alleviate these things in the short term. Increasing production in a short period of time is probably the biggest challenge the factory has. But I know in Texas they are running full Saturday production, which will generate greater truck availability. I believe we're [getting ready to ramp up production] in Mexico for Tacoma.
On top of the production that we get out of Texas and the Tacoma plant, we also are going to get another 30,000 Highlanders out of our Indiana plant. So these are all actions that have been taken that will benefit Toyota dealers in 2016. That will make a big difference for us.
In the fourth quarter, some dealers reported squeezed new-car margins and growing new- and used-vehicle inventories. What are Toyota dealers seeing in 2016 and how are they responding?
We saw a record January, so 2016 is starting on a good path. We were the No. 1 retail brand in January -- again. I think in the fourth quarter, because of weather, we always start to see a bit of an increase in days' supply and as we're clearing out the outgoing model year we see some decrease in margins, but I would say Toyota dealers enjoyed a record year in profits. New-car sales are strong. When you take a look at the year that was and take a look at the year to come, we know there'll be a lot of consumers out there buying new cars and we know that they continue to prefer Toyota over every other brand.
Should Toyota step up incentives in some form -- say, sweeter lease deals or more cash on the hood -- to keep sales growing even more?
Toyota has maintained their leadership in the industry because they make great products customers want to buy. But I will also tell you that they monitor the market very closely.
They are always seeking feedback from us, wanting to know what we're seeing on the show floor and I think that they have been very quick to respond to regional differences in different segments, be it small cars or small SUVs. I suspect that will continue. The biggest challenge right now is this truck production we are facing. It comes down more to production than incentives.
But I can promise you they will continue to make sure that their products represent the very best value. Not only just nationally, but locally and regionally.
What do you hope to accomplish as chairman of the dealer council?
Before I was chairman, I was a member of the national dealer council and I can tell you that Toyota's dealer council process is the best in the industry; it's truly unprecedented. [I want] to make sure dealers are bringing their concerns and what they see in their markets are brought to Toyota.
Toyota wants to hear from dealers and they respond. As I look at 2016, my job is to make sure that dialogue continues. Whatever comes in 2016, we'll do everything we can to protect that special relationship between Toyota and its dealers.
I was really impressed when I first joined the dealer council with the high level of communication and the partnership between Toyota and its dealers. Toyota has about 1,200 dealers and those 1,200 really have a voice with the manufacturer.
As dealer council chair, I don't have any particular wisdom in terms of pushing one item or another. The role is to ensure that the dialogue continues so that Toyota and its dealers can have the best relationship in the industry.
Were Toyota dealers told that Scion was being discontinued?
We were. That was a decision that was made over a long period of time. We were told in advance of the public announcement that the decision had been made. Scion was such a grand experiment that started back in 2003, I think, and it really was designed to act as a laboratory where Toyota could maybe work with innovative products, with innovative processes.
They used it to connect with a younger buyer. I think dealers across the country recognize the success Scion has had. We all recognize that it's made us a better company. We all look forward to taking the spirit of Scion and infusing it in the entire Toyota lineup.
We have great products in Scion -- the iM, the iA, and the FR-S is a really exciting sports car. Next year we get the C-HR, which is going to be a great player in the compact SUV space. Those cars are going to attract millennials; they're going to attract folks who are new to the Toyota brand. They perform that role as Scions and they are going to perform that role really well as Toyotas and they're going to help make the brand even stronger.