Toyota’s Carter says sales nearing plateau, but will remain solid

Carter: “We’re talking about leveling out at a historic, record pace for the car business.”Photo credit: Joe Wilssens

U.S. auto sales may be nearing a plateau, but that’s not a sign of trouble ahead, Bob Carter, senior vice president for automotive operations at Toyota Motor Sales U.S.A., said Thursday.

Carter said Toyota expects sales to remain at the current level for at least “a solid 24 months.” He doesn’t necessarily see a steep drop-off after that but said the outlook just becomes murkier further out.

“We’re talking about leveling out at a historic, record pace for the car business,” Carter said at the Automotive News Retail Forum at the Encore Las Vegas. “We’re really bullish. While there may not be a lot of growth left in the market, right now is a great time to be in it.”

Toyota has managed to adjust its production to closely match demand on cars, crossovers and SUVs, Carter said, but it’s struggling to keep up on pickups. Toyota currently has a 14-day supply of Tacomas and a 27-day supply of all pickups, far below what’s considered ideal given the complexity of that segment.

“Pickup trucks is a challenge for us,” Carter said. “We have more demand for pickups than we’re capable of building.”

Toyota already is building Tacomas on three shifts and expects to produce more than 300,000 pickups this year, but that probably won’t be enough, Carter said.

The industry’s record sales pace makes practices such as stair-step incentives and punching — dealers buying vehicles out of their own inventory to boost sales artificially — even harder to understand, Carter said.

Stair-steps ‘a cancer’

He called stair-steps “a cancer in the industry” and said Toyota, which “at one time was the king of stair-step incentives,” doesn’t use them anymore.

Yet he downplayed the significance of registration data showing that Toyota’s Lexus brand won last year’s luxury race, even though BMW reported more sales.

“Customers don’t care if we sell 400,000 or four,” he said. “They only care about the one they’re buying.”

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