Canadian auto dealer traveled to the headquarters of Toyota Canada in Scarborough, Ont. for a one-on-one interview with Larry Hutchinson, who was the Vice-President of Sales and Marketing at Toyota Canada Inc. Since that interview, he was named President & CEO at Toyota Canada Inc. Here’s part of the conversation with our columnist and automotive journalist Petrina Gentile. You can watch the full interview here.

Larry Hutchenson
PG:“You’ve been with the company for nearly three decades — what’s the biggest change you’ve seen over the years?”
LH:“When I joined it was a company of about 70,000 sales and last year it was over 200,000 sales. Obviously we need a bigger company to do that, but the beautiful thing is the DNA of the company hasn’t changed. The things we believe in are the same — from a customer point of view like quality, dependability, and reliability, and from an employee engagement point of view. It’s a really good, solid belief structure within the company. We have some strong Toyota beliefs and certain ways to do business. That is a really good backbone. That has been consistent, but it’s a bigger company. When you get a bigger company you have more structure, but we really try and empower our associates and let everyone grow as much as they can grow. Those core beliefs are still there.”
PG:“Are there plans to expand your dealer network in Canada?”
LH:“First of all, our dealership network is fantastic. We know from outside studies that we have the best facilities in Canada. On the Toyota brand, we’re the No. 1 ranked facilities, and we have the best customer satisfaction on sales and service. Our dealers are doing a great job. We don’t see from an expansion point of view the need to add dealerships. Our market would have to grow a lot, but right now we have no need to increase our dealer count. It’s important for a dealership to have profitability, and that’s something we work with the dealers very closely on because we think profitability can lead to customer satisfaction. If they have the resources, and make sure they’re satisfying the customers, then it becomes a circle. A good operating business needs to do that. It’s something we believe in. We believe in our dealer partners. Something I always say is we’re not good retailers — I’m not in the retail business. Our dealer partners are in the retail business, and we need a partnership with them to be successful.”
PG:“When it comes to auto manufacturing Mexico is emerging as a global powerhouse — is this cause for concern for manufacturers who build vehicles in Canada?”
LH:“I can’t comment on other manufacturers; I can comment on our own situation. We built 579,000 vehicles in Canada last year. We sold just over 200,000, so we’re a net exporter of 379,000 vehicles out of Canada. We have lots of capacity here — much more capacity than we certainly sell. We export not only to USA, but other places as well. We’re the only Lexus plant outside of North America — we just introduced ES in Georgetown [Kentucky] and we have Corolla and RAV4 so I’m not worried about that for our situation. QDR [quality, dependability, reliability] is the foundation for us. We really believe in it. It’s built by our great plant workers, and they build quality into each vehicle. On top of the QDR our story today really is beyond that. We want to build an emotional attachment to our brand and to our vehicles on top of our great QDR story. Not give it up, but build it on top. With Lexus you’ve seen that in the design, customer experience, and in the sales results. In the new vehicles we’re introducing at Toyota you’re also seeing it from a design point, but also driveability and technology building on top of quality, dependability and reliability.”
PG:“When will we see fully autonomous cars on the road?”
LH:“Our gauge right now is long, long, long-term there will be autonomous cars. In the midterm probably more of a driver assisted autonomy — whether that is a driver that lets the autonomous driver take over in certain situations or just assist the driver ongoing. Certainly, we’re seeing a lot more around the world starting to have tests of autonomous cars, and you’ve seen us show autonomous cars in Japan and North America. Toyota is a very large company with lots of research — probably the biggest expansion of research development in the world from an automotive point of view, and it is certainly putting a lot of money into it. The goal is safety. One of our goals is to have zero accidents. How do we improve the technology in vehicles to have zero accidents — that’s car-to-car and car-to-pedestrian. That’s ultimate safety.”
QDR [quality, dependability, reliability] is the foundation for us. We really believe in it. It’s built by our great plant workers, and they build quality into each vehicle.
PG:“When it comes to consumers, what’s being done to protect against cyber risks in connected cars?”
LH:“I think it’s a concern not just with cars. We all have smart phones and home Wi-Fi networks … This is not a car unique issue, but certainly technology from a safety point of view is throughout all types of industries. But as soon as you start having connected cars it opens that door, and you’re starting to see that. We’re a pretty conservative company around those types of issues and we’ll take it step-by-step to make sure we have everything in place as we introduce that connected car.”
PG:“Canada’s auto sector is on track for another record year in sales. How will Toyota Canada end the year?”
LH:“We’re forecasting a very good year this year. Our sales should be up three-four per cent for the year, which is in line or a little bit above our plan. The market has been very strong. It’s great to see a strong Canadian market. I think economically, the fundamentals of Canada are very strong. We certainly see our record market continuing with record low interest rates today so we don’t see in the next two-three years a big issue from a market point of view. We think we’re positioned very well — with our new products and our great dealer partners — to take advantage of a very strong market for the next foreseeable future.”



