TRAVERSE CITY, Mich. -- Contrary to what he has been reading in the press, Toyota’s Bob Carter believes the U.S. auto market is doing just fine.
He didn’t like the way July sales results were widely reported in the media this week, Carter told his audience Wednesday at the CAR Management Briefing Seminars.
“When I read ‘U.S car sales crumbled,’ that’s not how I like to wake up in the morning,” said Carter, executive vice president of sales at Toyota Motor North America.
Automakers reported this week that U.S. light-vehicle sales dropped 6.9 percent in July. The seasonally adjusted, annualized sales rate fell to 16.78 million, from 17.82 million in July 2016.
Carter said he’s unfazed.
He believes the retail market is “very, very healthy,” and noted that July 2017 had one less selling day than the year-ago month.
“We’re not on a sleigh ride down,” Carter assured the audience. “I believe we’re going into a period of plateauing over the next 24 to 36 months, where we can expect industry SAARs to be in the mid to the upper 16 millions, and that’s good for dealers, that’s good for customers and that’s good for OEMs.”
Toyota’s sales rose 3.6 percent in July from a year ago, with light-truck deliveries overcoming weakness in cars.
Toyota sold 12 percent fewer cars last month than a year earlier, but 17 percent more light trucks, according to the Automotive News Data Center.
The RAV4 crossover set a monthly record with 41,804 sales, but that gain was no surprise to Carter, who noted that the trend of rising crossover sales has been on the horizon for quite some time.
“A decade or two ago, there was a stark difference between what was a passenger car and what was truck/SUV,” Carter said. “If you wanted comfort, if you wanted amenities, you were a passenger car customer. If you wanted all-wheel drive and utility and towing a boat, you purchased a truck or SUV. Ten years ago, there was no really in-between.”
Carter said the segments have blurred, with amenities spreading to SUVs and pickups. As a result, the SUV and truck segments “will continue to grow for several more years,” he said.
He also warned naysayers not to count out midsize sedans, a once-dominant segment that has been in a downward spiral.
“We’re starting to see innovative products and investment coming to passenger cars for the first time in years,” he said, pointing toward the redesigned 2018 Camry, which is arriving at dealerships.
“Through these investments, I do believe we will see some stabilization of the midsize sedan market.”
Despite a plateauing market, Carter remains optimistic about the industry’s direction.
“I’m energized,” Carter told Automotive News. “The industry is not at a pace where it was in 2016 -- we didn’t expect it to be at the pace of 2016 -- but it’s still very healthy.”