Cox Automotive explores Toyota’s recipe for success with dealers

No OEM does a better job of “showing their dealers the money” than Toyota/Lexus, according to a recent Cox Automotive Commentary & Voices article. In referencing the United States market, Cox Automotive said Toyota has become the number one volume brand. 

Toyota is also expected to deliver 20 per cent year-over-year growth in the first quarter of 2024, due in part to greater inventory availability — but also because of the OEM’s ability to deliver “top-shelf” new vehicle gross margins to its Toyota and Lexus dealers.

“Cox Automotive’s data intelligence reveals that Toyota consistently has the most robust online shopper interest, low days’ supply, and some of the healthiest transaction prices within their competitive segments,” said the company in the article. 

They added that while many OEMs are looking for incentives to help boost sales,  “with industry average incentives as a percent of transaction prices now at 5.9 per cent, Toyota and Lexus continue to pull sales with only half the average industry incentive spend.”

Cox Automotive highlighted three key ingredients to the OEM’s recipe for success: its partnership with dealers and seeking win-win outcomes; its product portfolio that includes long-held convictions about product strategy; and customer loyalty (customers love the fuel-efficiency, reliability, and strong resale value). 

However, although their playbook is easy to see, Cox Automotive also said it is hard to replicate.

About Todd Phillips

Todd Phillips is the editorial director of Universus Media Group Inc. and the editor of Canadian auto dealer magazine. Todd can be reached at tphillips@universusmedia.com.

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