Business / Corporate

Toyota to adapt car sales strategy amid trend toward vehicle sharing

Kyodo

Toyota Motor Corp. will overhaul its long-held market segmentation sales strategy in Japan, with plans to sell all models at its stores by the mid-2020s, sources said Thursday.

The revamped marketing approach, according to the sources, comes as the company moves to streamline operations in a shrinking domestic market affected by the spread of vehicle sharing.

Under the current strategy, which has continued for more than half a century, Toyota’s domestic sales are essentially handled by four dealership chains — Toyota, Corolla, Netz and Toyopet — each catering to different segments of the market.

The upscale Lexus brand has been sold separately, and will continue to retain its own network. The auto giant also plans to drastically cut the number of vehicle models it sells in the domestic market from the current 60, the sources said.

The move follows similar efforts by Nissan Motor Co. and Honda Motor Co. to unify dealerships. Japan’s declining population and the rise of car-sharing have compelled automakers to reduce development and sales costs.

Toyota aims to establish a business model that does not solely rely on new car sales, but instead has it entering the car-sharing business and developing services based on local communities.

There are about 280 Toyota sales companies across Japan. More than 90 percent of them are managed by local businesses rather than being directly operated by the auto giant.

Among Toyota’s dealership chains, Toyota sells pricier vehicles and Corolla offers mass-market models, while “Netz” and “Toyopet” focus on younger drivers.

In reducing the number of models, Toyota plans to integrate vehicles that have a common engine and chassis but are sold under different names and designs, the sources said.

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