TORONTO — All-wheel drive sedans will likely figure more heavily into Toyota Canada’s product plans in the coming years amid rising demand for the technology.
Toyota Canada CEO Larry Hutchinson, speaking with Automotive News Canada staff at the automaker’s Toronto headquarters earlier this fall, said the company needs to “take a hard look” at offering more AWD options for its sedans. He said AWD has started to “bleed down into the mainstream market” as automakers offer more lower-priced utility vehicles, meaning more customers are going to expect an AWD option.
“There’s more opportunity,” Hutchinson said. “You have a [RAV4] and a C-HR, as an example, that’s coming down in price point into the [low-$20,000 range]; and then you have sedans alongside that ... and you, above that, have luxury sedans, which are all-wheel drive. Certainly, we see that spilling down.
“I don’t think we’ve made public announcements about what we’re going to do with those sedans. But certainly, it’s well on our radar that we need to take a hard look at that and get our plans in place on what we would like to do ... moving forward.”
Hutchinson’s comments came as Nissan prepares to roll out its redesigned Altima sedan, which will come with standard AWD, and as the share of vehicles equipped with AWD continues to grow in Canada.
One potential impediment to Toyota’s offering more AWD options is the cost. Hutchinson said the average AWD option adds about $2,000 to the price of a vehicle, representing a bigger share of a typical sedan’s overall price than that of a typical utility vehicle, for instance.
Hutchinson also said Toyota Canada would “request” either an AWD version of the C-HR subcompact crossover or another vehicle in that segment with an AWD option.
“C-HR is kind of a unique vehicle,” he said. “It really is designed to be a very expressive, sporty-type SUV. And in that front-wheel-drive segment, we are probably dominating that part of it. So that’s good from a product point of view. Would I like to have an SUV in that category that had all-wheel drive? Certainly, I’d like that.
“From a distributor point of view, a dealer point of view, we want to take every opportunity we can, and there’s an opportunity there to compete more directly in that all-wheeldrive market below RAV.”
Still, he said, AWD in that segment isn’t pressing because many potential C-HR customers “have never had all-wheel drive, and they’ve just been fine [in] their Corollas, their Camrys, their Civics, whatever it may be.”
Hutchinson, 55, was appointed to his current post in December 2015, becoming the first Canadian to lead Toyota Canada Inc.. The native of Chelsey, Ont., spoke with Automotive News Canada Editor-in-Chief Jeff Melnychuk, Managing Editor Grace Macaluso, Toronto bureau reporter John Irwin and Automotive News Chief Content Officer Jamie Butters. Other interview topics included:
THE RAV4 REDESIGN
“RAV has been No. 1 in the segment the last couple years. Right now, it’s neck-and neck with the [Honda] CR-V. We’ll see who finishes No. 1. We are going into the end of a life cycle, so we’ll probably have inventory issues maybe by the time the end of the year comes up. I’m not sure what we’ll be able to do there.”
THE CANADIAN AUTO MARKET