With the December retirement of Tony Wearing, Larry Hutchinson has assumed responsibility for Toyota, Lexus and Scion in Canada along with product planning, sales and inventory planning and dealer standards and representation.
Hutchinson has toiled with Toyota associate for 26 years in nearly every department.
Shortly after assuming his new position, he took time to talk to Canadian AutoWorld about the outlook of the automotive retail market, new Toyota product and his to-do list as the automaker’s newest managing director.
What’s top of the to-do list?
It’s a new year. The first thing is to contact the dealers and find out what happened during the Christmas break and make sure it’s where we expect it to be. We also want to touch base internally and have strategy meetings with the three teams – Toyota, Lexus and Scion. Then we want to meet with our partners both with Japan and in North America.
To-do list for dealers?
From a dealer point of view, I would be remiss if I didn’t say that Tony left a very strong organization both at the corporate level and with our dealer network.
From a facility point of view, we have almost 247 Toyota dealers, 87 Scion and 36 Lexus stores. We added a couple Lexus stores in 2012 and will have one more opening in 2013, but we don’t see the dealer count changing.
We’re in the major markets we need to be in, though there will be a couple of Scion points added as dealers have built new facilities and now have space there they didn’t have space before.
From a dealer relationship point of view, we know we have great dealers. They are customer-focused so our dealer body doesn’t need to be one of my areas of focus moving forward.
What are your priorities with product?
Without talking about specific products, we are strong today from a quality, dependability and reliability (QDR) point of view and the market knows that.
We are also very strong from a brand point of view, so we have a great foundation on which to grow. What we really want to do is build on that foundation of QDR and bring a little more passion out. We have been doing that more and can point to Lexus LFA and Scion FRS as examples.
We just launched the Toyota Avalon. But it’s not just about new products. We are working on engagement and dynamics from a driving style point of view. This isn’t new. This is Toyota growing in line with the market.
The next big thing for Canada is RAV 4 launching in mid-February. Built in Canada, it is our second-biggest volume vehicle and we have big plans for the new RAV 4.
On the Lexus side, we did GS this year and just did LS as well. We showed LS at Detroit and it’s scheduled to launch later this year.
Is the FR-S a sign of things to come from Scion? Will we see more sports-oriented nameplates?
I think we will see different roles for different vehicles. They will get more dynamic and have more expression in each vehicle. FR-S is a great sports car; iQ is a great city car. But both give you that fun-to-drive dynamic which runs through all of Scion products.
How may nameplates will that Scion have?
We haven’t committed to a number. We have historically had three and we are running with five now. It will vary over time. Who knows for the future? Scion is a young brand that is bringing in a high-percentage of customers that are new to the Toyota brand so we are attracting a new buyer with Scion.
Is it too early to see if Scion customers are starting to work their way through your brands?
I think it is. We’ve been in the market with Scion for less than three years so we aren’t seeing any turnover of that product in Canada.
But are you getting the younger buyers you wanted?
Yes. The average age of a Scion buyer is roughly 10 years younger than a Toyota buyer.
What are your thoughts on the 2013 retail sales market?
2012 was a little stronger than we expected. Our forecasting for last year was for marginal growth in 2012 through to 2014, but we are now seeing things remaining more stable because of the performance last year.
We don’t see any huge bumps going forward. But when we say stable, it should be pointed out that this is a great market. It would be great to see this stable market going forward.
For the Toyota side, one of my focuses is on sustained growth. We don’t need to jump by leaps and bounds. We have solid market share in Canada and we want that to continue to grow.
If it outpaces the market, so be it. We don’t like to publish sales targets
Toyota Canada president and CEO Seiji Ichii told Canadian AutoWorld in February 2012 he had targeted 200,000 in combined Toyota, Lexus and Scion sales for 2012. You fell a bit short of that. Is that your target for 2013?
I don’t want to put a number on it, but if you can envision that we are really close to that range now. With a little sustained growth, we would be moving north of those numbers.
What does the near future hold overall for you and Toyota?
This is an exciting time. I’ve been with the company for 26 years and have worked in every area of the business – operational, sales and marketing, service, and in all three brands. So I have a pretty broad background. I’ve seen ups and downs both with the brand and the industry, and I know we are positioned really well.
Our brand is strong with the market and we intend to build on that going forward with new product. We have a really strong dealer network that has made lots of investments. We have strong relationships with our dealers and we have great product coming.
These are great times coming for Toyota, Toyota associates and our dealers.