We reported this a month ago, but it’s now official because it’s a featured story in today’s Wall Street Journal: the Prius is going to become a stand-alone brand for Toyota. Looking to capitalize on the environmental street cred that the Prius has achieved, Toyota plans on spinning the name into a new line of vehicles, all hybrid, all distinctively styles to make them obviously hybrid, and all part of a stand-alone brand.
But can Toyota make it work?
Or will this be one big colossal failure?
Bet on the later.
Give Toyota the benefit of the doubt and assume it could put a new vehicle in the showrooms in three years. That would be 2010. That would be an exceptionally short lead time for developing a new car, and for developing a new dealer network to sell it, but assume they can pull it off.
That puts Toyota on the market with their new line of hybrids at exactly the same time GM comes out with the Volt. The Volt, however, is not an old-line hybrid, but is a plug in vehicle. GM is not kidding on this one, they’ve actually made that bet a very clear one. Toyota, in contrast, isn’t even trying – at this point, unless they’re bluffing big time, Toyota is giving up on the entire “plug-in” concept.
Those new hybrid Prius models will hit a market very different than that of today. 
First, Honda’s working on their own distinctive hybrid, having learned from the mistake of making a hybrid merely an option, rather than a distinctive cheese wedge. They will be on that market before Toyota.
Second, GM is usurping the hybrid concept. They are making it an option in everything. Hybrid isn’t a political statement at GM. It’s a way of selling big cars by giving people the option of having better fuel economy without giving up size. Three years from now, there won’t be anything all that distinctive about having a hybrid. It’s going to be in the same category as cruise control and power windows.
Third, Toyota is exceptionally poorly positioned to be cranking out new model lines. They can’t build the ones they’re selling now without having to recall them faster than they build them. Toyota is in the process of losing its most valuable asset: the reputation for quality. Reputations take years to build, but can be lost quite quickly. Toyota does not appear, from current evidence, to have the ability to produce current models without serious quality problems. They cannot possibly produce new models without exacerbating those issues, and that is self-defeating.
At present, Toyota is its own worst enemy.

Ralph Kalal
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  (132) posted on 10.26.2007

Toyota is taking a big jump of faith with this... might blow in their face

  (372) posted on 10.25.2007

In Toyota’s world, three years isn’t a short time in which to develop a new brand. Like you said, they don’t really have to get it right the first time. They can smply recall what they need to recall later on. LOL.

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