Toyota’s homely IMV 0 could solve a critical problem with modern vehicles: affordability.
If you live in Southeast Asia, you have multiple options for low-cost motor vehicles that are unavailable in North America. An example is the very utilitarian Toyota pickup, the IMV 0, which has a base price as low as as US$10,000. High style it isn’t, but as a utility vehicle, it combines a very practical form factor with economy and solid engineering.
A typical entry level half-ton pickup in the United States has a transaction price well into the $40,000 range, and Toyota’s own US product is frequently more expensive than that, much more expensive.
Is there a market for very basic, rugged and inexpensive utility vehicles in America? With rising interest rates and inflation, the answer is” possibly”, but to date, no manufacturer has tested the big American market with a low-priced vehicle
Access all episodes of End of the Line on Engineering TV along with all of our other series.
* * *
Episode Transcript:
Take a look at this sow’s ear of a pickup truck. This is the Toyota IMV 0, a new light truck the company has launched for Asian markets like Thailand, but not here in North America.
Yes, it’s ugly. Damned ugly. But there’s one aspect of this vehicle that’s very attractive: the price. The base price of this small pickup is approximately $10,000.
That’s right, ten grand. With the average transaction price of new cars in America something like $40,000 these days, along with rising interest rates, affordability has become a major issue for the automotive industry.
And of course, electric vehicles are even more expensive.
The result has been skyrocketing used vehicle prices. With very high levels of consumer debt also worsened by those same higher interest rates, many are predicting real softening in the new car market next year. The economists will call that softening demand, but that’s not really the truth. The demand is there, and always has been, but the ability to afford the product isn’t.
There are lots of reasons for this, from historically low interest rates in the past, which encouraged profligate consumer spending, to a tech-driven switch away from durable, basic machines to highly sophisticated, computer-driven products, mirroring smart phones.
The result of all this is a current world where a basic half ton pickup truck is approaching $50,000, which with current interest rates is not going to be affordable for the bulk of the consumer base for that kind of vehicle.
Machines like this Toyota offering, are an interesting alternative, and an opportunity. The American tradition is a base price MSRP, from which the vehicle is then optioned during the ordering process to add features individual to the consumer. The order goes to the factory, and your personal machine is built. For those who want to order off the rack, stock vehicles are built with packages of popular options, but for those who order a vehicle, it was always possible to build a highly unique combination.
What if Toyota did something similar with this vehicle. Imagine a very low-priced entry-level pickup truck, in which the auctioning-up process happens after the purchase, not before. Imagine a market where things like audio systems, power accessories, upgraded interiors and even powertrains are sold to individual owners, à la carte, after they buy the vehicle. Going in for an oil change? Get a pickup cruise control while you’re there. At the dealer for regular maintenance? Why not upgrade the seats while you’re there?
And this concept could spill over into the aftermarket, something we are already seeing in the U.S. light truck market, where dealers frequently package accessories like alloy wheels, bedliners, lift kits, window tint and other add-ons upfront at the sale.
The key would be to engineer the vehicle to easily accept these upgrades, which requires that the base vehicle be designed with absolute simplicity in mind.
I think it would be wildly popular, but there are obstacles. Two of them are the DOT and the EPA. Current motor vehicle safety standards are, I believe, excessive, and upgrading a vehicle like this to modern standards will be expensive. And, of course, emission controls are always an issue. But I believe a vehicle like this could probably come in with a base MSRP of $15,000 in the U.S. market.
It might have to be assembled in Mexico or Southeast Asia to achieve this, but on the other hand, extreme simplicity also makes the production process much easier to automate.
I know, you’re saying, “but it’s ugly.” It is, but it doesn’t have to be. The base exterior shape of the vehicle could be streamlined without additional cost, and let’s face it, vehicles like the Jeep Wrangler are hardly beauty queens. But utilitarian form and ruggedness has a beauty all its own.
The Detroit Three own the pickup truck market, but Toyota is dominant worldwide. I believe there is a market for this kind of engineering simplicity North America. So how about it, Toyota?
