Toyota was once the king in Thailand when it came to being the most popular car brand. The title was held for a very long time until recently when Honda overtook Toyota for top sales figures. It is very surprising since Toyota has many large factories to assemble Hilux, Vios, Fortuner and Altis models. Toyota dominated Thailand's automotive industry for decades and Honda was nowhere close to challenging Toyota for sales.
Toyota really needs to rethink its strategy for South East Asia. Honda overtook Toyota in Malaysia and now Thailand. The shift will definitely start to worry Toyota's top management since their sales figures are declining. Toyota's customers seem to prefer Honda and this shift could be down to demographics of the buyers. Toyota's buyer traditionally are from the older generation and as the buyers ages their frequency in changing cars will decline. The younger generation do not look so much at the brand and prefer trendy new designs. Toyota has been labelled as old and boring while Honda has the image of the young and sporty.
Apart from the ageing models, Toyota cannot keep relying on their brand image to sell cars. They need to move with the times and improve their designs. Honda's direction is clever and they targeted the younger buyers to great effect. Even the engines and transmission have to improve to keep up with the market trends. Toyota has always been a laggard when it comes to introducing new functions and new features into their cars. This overly conservative mindset has cost them dearly.
A good example is Mercedes Benz which once was labelled as an old man's brand however, in the last 5 years the image of Mercedes Benz has changed tremendously. The new designs are aimed at the younger buy and the trendy look of the car made a massive difference. The change in direction saw Mercedes steal many younger customers from BMW and Audi. The marketing and promotions are also aimed at the younger buyers. All this effort paid off for Mercedes and it hit record sales 2 years in a row.
Toyota can do something similar to Mercedes but the question will again fall back to its ultra conservative management. If Toyota wants to remain relevant to the younger generation it has to reinvent itself and move with the times. Merely putting a car together with an out of date engine and old gearbox will no longer cut it. Competition is much stiffer now and relying on brand alone is not going to help.
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