It looks like the pickup truck wars are on, and one automaker from Japan is not declaring "Mission Accomplished". Within the span of a couple months, the new "game-changing" Tundra was launched, Toyota then placed cash on the hood of the new truck, the guys and girls over at Nissan canceled their HD version of the Titan, and now more cash is needed to move Tundras.
The newest incentive calls for an additional $1,000 towards the trade-in of a regular or extended cab Tundra. The Crew Max still has zero incentives on it, but the base Tundra now carries up to $3,000 in cash on the hood, depending on the model and what region in which it's purchased, which is very close to the $3,500 in incentives that you can get with a four year-old F-150. Special financing is also available on the Tundra for customers with Tier 1 or Tier 2 credit ratings.
Earlier this decade, Toyota did a terrific job of holding steady on incentives while the domestics went wild with 0% financing and $6,000 cash back offers. Now that it's trying to tussle with the Detroit Three in the pickup truck segment, tried and true Toyota discipline is out the window. This isn't a brand-new trend, either. Last year at this time, the previous generation Tundra had $4,500 on the hood, but we thought that trend would be coming to an end with the introduction of the new model. Guess not.
[Source: Automotive News - sub. req'd]
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Reader Comments (Page 1 of 4)
John P. @ Mar 29th 2007 8:52AM
At least one thing toyota has going for it is that they can survive cutting the price to levels where people actually wanna buy this turd, and still survive. They've got some cash currently to burn.
porker @ Mar 29th 2007 8:54AM
Well it sounds like toyota might be gettng there. Producing a clearly inferior trucklike thing that is 6-8K overpriced is one thing, but now they realize that, in order to meet even their scaled-back production figures, they're going to have to get the price down to where it's merely outrageous.
JapH8r @ Mar 29th 2007 9:05AM
No matter how much money you put on the hood of a pile of crap, it's still pile of crap. They now realize the inferiority of their product and how they can't make it compete at any level.
akintz @ Mar 29th 2007 9:09AM
And I always thought the Apple and/or Linux fanboys in the tech world were funny... you crazy American auto industry fanboys are the best.
DJ @ Mar 29th 2007 9:16AM
As far as I can tell, these incentives are on the base/standard cab models and we all know the typical buyers of this type of truck, the workhorse/high abuse part of the market, typically buys GM/Ford and has become used to some cash on the hood, so Toyota is just following suit. All Toyota is doing is ensuring it gets its feet into all parts of this market to begin developing its customer base. This is really their first serious stab at the full-size market market and they have a tiny sales target for this generation of Tundra (around 100K I believe), so I wouldn’t read into this that they are really hard up to sell these. They will reach their sales target, easily, if they need some cash on the hood to make buyers feel like they are getting the best deal they can, just like the domestics, then it’s no big deal.
The Other Bob @ Mar 29th 2007 9:31AM
This is one area where GM Ford and DCX can actually cut their prices below Toyota and still make money.
Since Toyota only has this one plant, plus they don't yet share many parts between the Tundra and their SUV's like the big three trucks, Toyota doesn't have even close to the economy of scale that the big three have.
Toyota may have a bunch of cash, but at some point it won't make sense to build these trucks if the big three can cut prices and still make money.
It's the reverse in small cars. GM and Ford haven't invested heavily in small cars because the imports had economies of scale so huge that the big three could not complete and be profitable in those segments.
It is possible that if Toyota doesn't at least break even and its truck doesn't catch on to the public, they could fold up the model line eventually.
Castle @ Mar 29th 2007 9:43AM
Well the domestic full size truck market is very different from automotive market, Toyota needs to do more, and do it cheaper then the domestics if they intend on capturing any more of that market.
However, the Tundra only plans on selling 200k, which is a fraction of what GM/Ford sells, hence its probably a very attainable goal.
Mike @ Mar 29th 2007 9:45AM
akintz: It has been shown, repeatedly, that this is not that good of an offering. The interior beats only the Ram...and that is even subjective. The exterior has questionable looks. The frame has questionable strength. The crash test results are sub-par, and Toyota is scrambling to place a band-aid on it rather than fix the damn problem (just like the previous gen tundra seatbelt issues).
DJ: If you honestly believe toyota is slapping $3,000 on the hood to make buyers comfortable, and that's what they are used to, I have a bridge to sell you. That is the biggest line of BS anyone can spew. Cash is on the hood because base to base, the toyota is priced $3k or more over domestic counterparts. Combined with all of the above, Toyota needs to do this to move them, not from the goodness of their hearts.
Dandy @ Mar 29th 2007 10:08AM
OMG it's such a turd, the frame is going to break just looking at it! Apparently I live in the only part of the country that 80% of full size truck owners do not use the vehicle as a truck, and where 99.2% of them do not tow/haul anywhere near a quarter of their true potential. It's best described as one of my father's co-workers: He buys a new Ram every two years, and once a month will wax not only the truck, but the bed as well. Tundras will still sell around here if for no other reason than HP/TQ, I've seen more on the road than the new Chevy.
#4 is right, domestic fanboys are the worst fanboys of all.
rob @ Mar 29th 2007 10:08AM
autoblog,
i dont know what it is about you lately, but you've played more and more to your domestic fanboy base... i'm sure you love that it brings all the ignorant idiots with internet access out to post on your website but still...i'm kind of disappointed in you.
and for those ignorant idiots...an article, with facts (oh no! not real facts!):
Initial trading patterns for the all-new 2007 Toyota Tundra suggest a strong start for this model in the domestic-dominated large pickup segment, according to real-time retail transaction data from the Power Information Network (PIN), a division of J.D. Power and Associates.
Since the all-new 2007 Toyota Tundra large pickup was launched in early February, owner loyalty for this model, which represents the percentage of Tundra owners who traded for another Tundra, is 53 percent (February only)—more than twice the January rate of its predecessor and more than 20 percentage points higher than in February of 2006. Additionally, trading from the Tundra to each of the mainstream domestic large pickups (Chevrolet Silverado 1500, Ford F-150, Ram 1500) dropped considerably in February when compared with January, while trading in the reverse direction increased.
Nevertheless, owners of domestic large pickups remained relatively loyal to their vehicles. According to PIN data, both the Silverado 1500 and F-150 experienced owner loyalty increases of 4 percentage points when comparing transactions in February to those in January, while the Ram’s owner loyalty remained steady. (Loyalty for the Titan is not included since it has only been on the market for three and one-fourth years.)
The combination of increased Tundra loyalty and steady domestic model loyalty raised the large pickup segment share of industry from 12.4 percent in January to 14.4 percent in February.
“It’s still early, and owner loyalty is just one measure of marketplace success, but so far the Tundra seems to be gaining strength in the segment,” said Tom Libby, senior director of industry analysis at PIN. “This is an interesting scenario because the impressive strength of the Toyota juggernaut is being pitted against the domestics’ long-time stronghold.”
The Tundra’s owner loyalty rose in February even though it sold at a higher average retail transaction price than any of its direct competitors. The actual retail transaction price for the all-new 2007 Tundra in February was $33,182—almost $900 more than the F-150 ($32,312) and $1,450 more than the Silverado 1500 ($31,727). The Ram 1500 ($25,564) and the Titan ($27,664) both sold at prices considerably below the competition.
Four of five large pickup models sold with loans that included an annual percentage rate (APR) between 9 and 11 percent, while the F-150’s APR was far below the competition at slightly more than 7 percent. The monthly payment for these models, purchased with a 72-month loan, ranged from $558 to $603.
“New products and stable fuel prices will drive a strong rebound in the large pickup segment in 2007, increasing from 13.5 percent of the total sales market in 2006 to 14.2 percent,” said Jeff Schuster, executive director of automotive intelligence at J.D. Power and Associates. “Toyota dove head first into a very competitive segment with a solid entry, and although the model lineup is not yet as robust as the competition, we expect the Tundra to nearly double in volume from 124,508 in 2006 to 210,000 in 2007.”
PIN data also indicates that while the national transaction price for the 2007 Tundra was the highest in the competitive set, the Tundra did not sell at the highest price in every region of the country. Specifically, the Tundra commanded the highest transaction price in the Midwest, Southwest and West, but its price was second highest in the Northeast (after the F-150) and third in the Southeast (after the Silverado 1500 and F-150). Additionally, the Tundra’s price ranged from a high of $34,394 in the West to a low of $32,796 in the Southwest. Transaction prices in the Southwest for each of the five large pickup models were lower than in any other region, reflecting the fierce competition in large pickups in this particular part of the country.
CaliberSRT4 @ Mar 29th 2007 10:14AM
I got to sit in a Turdra at the STL Auto Show. I didn't sit in it simply because the seats were nasty. They where all fuzzy and and looked like it had cat hair all over it or something. And that dash is worse in person. My mom even said it was an awful truck. Toyota needs to make it cost cheap and look better than GM/Ford/Dodge if they want a piece of the competition.
Aaron @ Mar 29th 2007 10:16AM
the funniest fanboys are the toyota ones..
This is a nice wake up call. People have been tripping all over themselves saying that it WILL be successful, but anyone with a brain called it months ago - without incentives it ain't shit.
Toyota doesn't call all the shots ladies, and this is exhibit A.. lmao..
Mike @ Mar 29th 2007 10:16AM
it's interesting that Toyota is offering essentially a "trade-in" bonus of $1500 to present owners of the old body style Tundra. it's good that Toyota is doing this; those owners will certainly need all the cash they can get to unload their old ones.
the Tundra has never been a "book" vehicle when traded; trade in values for Tundras are always $2-$5K "back of book", or more.
now that all the hoopla has died down, and all the "gotta have the first one" excitement is gone, these new Tundra are literally clogging the lots. for those not familiar with the car business, the imports are based on the dealer "allocation" system; if you want hot selling vehicles, you're going to have plenty of slow-selling turds shoved down your throat. and unlike the domestics, import dealers don't order their vehicles; they are pre-selected for them by the factory.
I always enjoy the "Toyota didn't have unrealistic expectations for the Tundra" comments.
give me a break.
Toyota (contrary to what they say) was going for blood on this one; they won't be getting much. with all the hoopla about the San Antonio Tundra factory, everyone seems to be ignoring the fact that almost all Tundras now are coming from the Princeton (Indiana) facility, not the one in Texas.
with two hungry Tundra mouths to feed, Toyota is going to do whatever it takes to keep the factories running. I'm sure the advent of $3 per gallon gasoline (again) won't do much to help them, either.
the redesigned Sequoia will be out soon; I'm sure there will be a bundle of cash on the hood of that one, too.
AZMike
Mike @ Mar 29th 2007 10:26AM
"one automaker from Japan is not declaring "Mission Accomplished".
Don't you think it is a little crass to compare an automotive market segment to life and death situations? Americans are dying to keep attacks of american soil and to give another country the opportunity the defend itself and its freedoms the way we defend ours.
Besides, that speech had more purposes than what the press and leftists in general remember. The USS Abraham Lincoln (CVN-72) had just completed an extended deployment of nearly ten months, the longest in over 30 years for an aircraft carrier. They had been turned back toward the Gulf partway through what was supposed to have been the first leg of their homeward journey.
The Mission Accomplished banner was NOT about the IRAQ war. Understand that it was bare days before that day in May 2003 that we gained full control of the war theater. The banner represents a hearty well-done to the crew of the Lincoln Battle Group and Carrier Air Wing Fourteen (Fortuna Favet Fortibus!).
Louis Duran @ Mar 29th 2007 10:44AM
I love the use of Mission Accomplished. It underscores the difference between Toyota who is able to look at the long term and Bush who claimed Mission Accomplished when his approval ratings were sky-high to boost his short term fortunes without regard to longer term ramifications of his illegal war.
Mike, I think you need to get a clue.
AZMike @ Mar 29th 2007 10:54AM
Rob,
wow, certainly a lot of "facts" there.
just a few problems.
first, the much-vaulted J. D. Power (in bed with Toyota since 1980) only has numbers for February. how do you think March will look? as I mentioned in a previous post, Tundra sales were brisk at first; these were to the "gotta have the first one" folks. after those were sold, sales came to a grinding halt.
second, if you want death for a new model, have the sales slanted toward folks trading in another Toyota. they are stealing sales from themselves; no growth will occur from a static market.
and last but not least, "stable fuel prices". don't know where you live, but here in Arizona, fuel prices have gone up close to 80 cents per gallon in the past month. in California, it's over $3 per gallon.
I'm sure there are many sleepless nights over in Japan. the powers that be at Toyota were very nervous about doing the larger Tundra in the first place, as this (North America) is the only place in the world that they are sold. with the Japanese domestic market totally flat, Toyota's only growth is in overseas markets. if this thing flops (and Toyota's expectations for it are MUCH larger than they are letting on), there will be some heads rolling for sure.
AZMike
Barfin Lunch @ Mar 29th 2007 10:55AM
I'M BLIND!!! God what a FUGLY POS. I say let YotaMota become #1 and then they too will start shooting themselves in the ass.
GM is on a turn around and will be back very soon.
VL @ Mar 29th 2007 10:57AM
The Tundra is selling just fine. God willing.
The infidel American truck market is retreating and commiting suicide by the hundreds. Thousands.
Kevin @ Mar 29th 2007 11:05AM
I really enjoy some of the comments on the Tundra threads. There is usually a nugget of quality spread among a mountain of crap.
I have no problem with people saying the domestics are better than Toyota. If you want to pull a gooseneck or 5th wheel, the domestics are absolutely better.
I keep hearing people ripping on the new Tundra's interior. My own opinion is that it is far better than either the Ram or the Titan. It is marginally better than the F-150 and is FAR below the new Silverados. GM has made an interior that is far and away the nicest one on the market today. The one thing the Tundra interior has is a better organization for actual work. The center console is about ideal.
I live in a farming area and there are a lot of trucks around here. The Tundra plant in Princeton is also near here but you don't see any of the older Tundras being used for work trucks unless its pulling a low-weight landscaping trailer.
My brother owns a high quality construction company. He has about 20 trucks and usually buys Chevy. He is buying 5 new trucks this year and is getting 2 new Tundras after having problems with his recent Chevys. They are all extended cab, longbed, base model trucks. His guys beat the crap out of everything so we'll see how they hold up.
Mike @ Mar 29th 2007 11:11AM
"I love the use of Mission Accomplished. It underscores the difference between Toyota who is able to look at the long term and Bush who claimed Mission Accomplished when his approval ratings were sky-high to boost his short term fortunes without regard to longer term ramifications of his illegal war.
Mike, I think you need to get a clue."
Bush did not claim mission accomplished. The banner was hung by the sailors, not the administration. Please read the text of the speech, not the text on a photo. Plus, had you read my post, you would have seen the misison accomplished was meant for THAT ship, not the war.
Illegal war? Congressional approval says otherwise... and isn't it funny how for 12 years the Democrats claims of WMD and weapons programs are true, yet when President Bush said it its a lie? Read UN resolution 1441, authorizing the use of force with non-compliance. Iraq did not comply. Iraq did not comply with 14 resolutions over 12 years. Please tell me how the war is 'illegal'?
I do not blindly support Bush. There are many things that I SEVERELY disagree with his policy's. The war is not one of them. My friends and family, also in the military and having served MULTIPLE tours of duty, also agree with what we are doing there. I have my 'clue'. Please respond with as many more talking points as possible.