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Toyota Prius a Victim of Success
Filed under: Opinion, Toyota
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Toyota's Prius, having moved beyond niche markets into the consumer mainstream, is facing shortages as potential customers are stuck on a six week to four month waiting list.
The most significant limiting factor is the batteries. Every nickel hydride battery in a Prius is produced at a factory in Shizuoka, Japan. The factory has a production ceiling of about 500,000 a year. Expanded capacity at the Shizuoka plant should be able to add another 300,000 per year by 2009 and additional plants are being constructed to put annual output at over a million.
Toyota sales actually fell somewhat last month due to the atypical reason of being unable to meet demand. From March to May, Toyota sold an average of 47,000 hybrids a month, which would have set them on track to exceed their 2008 goal of 450,000 hybrid sales by 85,000.
Toyota’s inability to meet consumer demand is permitting their competitors to fill in the gaps as gas prices continue to grow, although the current selection is a little narrow. As options rapidly increase with competing automakers putting forth their own hybrid models, Toyota’s relative lead in the market segment will decrease over time.
Our take? Despite Toyota's highly boasted supply chain management, consumer demand has far outstripped their production capacity. You know life is good when your biggest concern is that your junk sells too fast.
via Financial Times
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