Toyota Talks Prius Prime, C-HR Crossover, and New Platform

Toyota went really big at the 2016 New York auto show, showing five new vehicles in one of its largest auto show rollouts in recent memory. We sat down with Toyota senior vice president of automotive operations Bob Carter at New York to talk about what’s new for the brand this year and where Toyota is headed in the years to come.

AM: Let’s start with the Highlander, which gets a new 3.5-liter direct-injection V-6 and an eight-speed automatic. Do you see this combination migrating to other similarly sized vehicles?

BC: Yes. Multi-speed transmissions, direct-injection, turbocharging, that really has to be the future path for the internal combustion engine to get better miles per gallon.

2017 Toyota Highlander front three quarters

AM: Switching gears to hybrids, it was a bit surprising to see the Prius Prime debut as a four-seater. Can you give us some insight about why?

BC: Overall it was a matter of packaging. But the consumers that use the Prius plug-in were using it as a four-seater, so we could have great packaging with the new battery and not sacrifice anything.

AM: The Prius Prime also has 7 cubic feet less cargo space because of the battery. Compared to the standard Prius, the plug-in has one fewer seat and a good amount less trunk space. At what point do you start to trade something off?

BC: You do trade off, [but] we doubled the all-electric range to 22 miles, which covers commutes for more than 50 percent of U.S. consumers. You can also plug into a standard 110-volt [socket], and if you can plug in at work that goes up to 44 miles. That covers 80 percent of commutes.

AM: More and more plug-in hybrid vehicles are hitting the market, and now there’s even direct competition from the Hyundai Ioniq. How does Toyota feel about that?

BC: We feel pretty good. It’s hard to take on a market all by yourself. There are not many cars in the market that exceed 200,000 [annual sales], but the Prius family is one of them. I think it’s an indication that this is great technology, and it’s here to stay.

2016 Toyota Prius Four Touring front view in motion

AM: So, the more the merrier?

BC: I’ll give you an example. At the Detroit show last year we had the Tacoma [midsize pickup] with 70 percent penetration in the segment, and here comes Chevy Colorado and GMC Canyon. Everyone is asking me, “How are you going to defend that?” But defending market share isn’t the goal; we have a sales and production plan, and that’s the goal. I said that Canyon and Colorado are good products, and so we will sell more [Tacomas]. People thought I was crazy, but look what happened. The market has grown about 11,000 units a month, and [they are doing] about 8,500 to 9,000 a month and our volume still grew by the remainder.

AM: Speaking of expanding markets, can you talk about the exploding compact crossover market? The Toyota C-HR is arriving a little late to the party, so is there anything left for it to bite off?

BC: Absolutely. That market grew by a little over 20 percent last year, after consecutive years of rapid growth. It’s now the largest segment in the industry, more even than midsize sedans. So I’m concerned that we might be even somewhat capacity restricted with C-HR, because we have not yet seen the end of that segment. It’s not growing [just] because of low fuel prices but as part of a fundamental shift in what consumers are looking for in the U.S. market.

AM: What does Toyota offer that’s distinctive and unique that will make C-HR stand out from a crowded field?

BC: C-HR has really passionate design. I love it. Intentionally, it’s perhaps a little bit polarizing. Interior packaging is amazing. It looks like a coupe-ish two-door, but it’s a true four-door. I’m 6-foot and I was comfortable in the back seat.

AM: How much of the concept do you think made it to production?

BC: It’s very close. If you go to the Lexus LC 500, look at the LF-LC; the laser headlights went to conventional LEDs in production, so expect things like that. The C-HR concept has cameras instead of rearview mirrors, that sort of thing, but the essence carries through. We are planning to show the final production version for the U.S. at the Los Angeles show [in November].

2016 Toyota C HR front three quarter 02

AM: Seeing CH-R on the stage in New York next to the 50th Anniversary Edition of the Corolla, you see a big new player right next to the car that defined Toyota for half a century. Going forward, is Corolla going to start to matter less and less?

BC: I’m not suggesting that sedans are not important. They are a huge segment which we do extremely well, and they will remain important. But the migration to utility vehicles is not a short-term shift.

AM: Is there anything on the enthusiast side that we should be looking forward to?

BC: Yes.

AM: [silence]

BC: I’ll give you a little bit of what I can. We are in the midst of a massive change.

AM: To adopting TNGA (Toyota New Global Architecture) platform technology?

BC: Yes. We’ve had a very strong association with high quality, dependability, and reliability. But we’ve got a lot of criticism from enthusiasts that both Toyota and Lexus aren’t passionate enough. Well, passion comes from two places: design or styling, and fun-to-drive characteristics. The fourth-generation Prius is a much better road car, and that gives you a taste of what this TNGA platform can do. As we roll that platform and the new design philosophy out to our products … these cars are getting fantastic, having driven some of the prototypes. We can maintain our high quality and start moving toward these more passionate areas.

AM: That sounds great.

BC: I’m very hopeful AUTOMOBILE will have some of our products on the cover in the near future. That’s as far as I can take you.

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