Toyota to Unviel Lexus Hybrid-electric SUV

Hybrid SUV to be shown at Detroit Auto Show.

Published: 02-Jan-2003

Detroit carmakers, the annual hometown auto show is traditionally the chance to brighten the dark days of early January with the dazzle of promising new vehicles. But for the Big Three, this year's North American International Auto Show will serve as a chilling reminder of foreign carmakers' continued assault on the lucrative truck market, where, not long ago, domestic manufacturers reigned supreme. Indeed, under the klieg lights at Detroit's Cobo Hall, from Jan. 5-7, auto makers from around the globe will yank the covers off an unprecedented array of pickup trucks and sport utilities -- from luxury hybrid models to stylish, car-based, SUV-look-alike "crossover vehicles." The increasingly crowded truck market almost guarantees that Detroit will lose yet more ground to its Japanese, Korean, and German rivals. Already, the Big Three's share of the U.S. light-truck segment has dropped eight percentage points in the past five years, to 76.4%. That's devastating for domestic auto makers, which derive most of their vehicle profits from trucks. Wesley R. Brown of Los Angeles auto consultant Nextrend Inc. predicts an additional four-point market share drop in 2003, calling it "a rough year for Detroit."

A decade ago, the very notion of a foreign truck invasion seemed laughable. With little appetite at home for bulky vehicles, Japanese and European carmakers lacked the knack for making the burly trucks Americans admire. But as SUVs and pickups became trendy, baby boomers demanded more stylish exteriors and luxurious cabs, creating an opening that BMW, Mercedes (DCX ), and Toyota (TM ) quickly drove through. Meanwhile, Toyota and Honda (HMC ), lacking rugged big pickup frames from which to spawn SUVs, instead put brawny-looking SUV bodies on nimble car chassis. The new crossover category was born. Now, Japan is digging deep into the traditional market for pickups that can pull stumps or tow a trailer. Nissan (NSANY ) will unveil its first big truck -- still shrouded in mystery -- on Jan. 7. It may join Toyota's Tundra as a credible threat to Motown's pickups. Japan also will introduce models in the bread-and-butter minivan and midsize SUV segments that are expected to make inroads on Detroit's turf. Toyota's revamped Sienna minivan has been enlarged to compete head-on with industry leaders such as DaimlerChrysler's Dodge Grand Caravan and Honda's Odyssey. And Nissan's sleek new Murano is winning rave reviews.

The elite SUV segment is heating up, too, as even sports-car specialist Porsche gets into the act. Hoping to cash in on Americans' love of horsepower, Porsche will roll out the high-performance, 340-hp Cayenne SUV. It's a low-volume niche vehicle, sure. But a niche with some of the richest pricing in the auto market: The high-end Cayenne turbo starts at $89,000. Foreign auto makers are gaining in the environmental stakes, too. Toyota will unveil the first gas-electric SUV in Detroit, a hybrid version of its Lexus RX 330, aimed at well-heeled environmentalists. Ford's (F ) hybrid Escape arrives late in the year, while General Motors

Still, the Big Three aren't conceding market share without a fight. Ford will unveil the latest version of its best-selling F-150 fullsize pickup in Detroit. The F-150, with a beefed up engine and refined interior, is considered a strong contender. And GM has new trucks almost across the board: a Cadillac luxury SUV, the SRX; the roomy Chevrolet Equinox, with a carlike ride; and a pair of midsize pickups, the Chevy Colorado and GMC Canyon. "Whoever has the best product wins," says GM North America President Gary Cowger. "We have a lot of trucks coming." Alas for him, so do his rivals.



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