Personal Log  #737

March 29, 2016  -  April 6, 2016

Last Updated: Tues. 5/03/2016

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Observations & Expectations.  It's nice to get asked something actually constructive: "Why did you buy a PiP? Are you happy or sad that Toyota manufactured it? Your discussion keeps coming across as Toyota was smart to make a car you wanted but even smarter to deny me the same car."  He is one of those supporters still quite upset by plans not meeting his expectations.  Unlike GM being backed into a corner (committed to the original approach), Toyota has been willing to adjust based upon what it learned.  In other words, the innovation pushes the two automakers in different directions.  He prefers that of GM.  I don't, since Toyota's is what targets the masses.  My effort is to endorse what will be realistic for mainstream consumers.  That will continue.  These are my observations & expectations:  I knew exactly what I was buying.  Expectations of GEN-1 were quite clear.  So, I have been very happy with that choice.  Expectations of GEN-2 were very different.  And based upon what's been revealed to us so far, Toyota will do well fulfilling them too.  The problem with the availability has been adaptation to the changing market.  Toyota included that in their plans.  That annoyed the heck out of some supporters.  They didn't expect the halting of rollout... even though that was always one of the potential choices.  Running such a massive business requires a careful consideration to risk. Leveraging other aspects of HSD advancement while collecting real-world data from the limited PHV rollout, along with analysis of consumer perception seems to have resulted in a Prime that will reach out to a new audience.  Expanding the market (penetrating deeper into the mainstream) is the ultimate goal.  You can't please all the people all the time.  You can widen appeal by responding with variety though.  Those are my observations.  What are yours?


Sales Spin.  There's been an ongoing effort by some to make it appear as though the hybrid interest will not grow, that plug-in offerings will surpass the marketshare in both size & speed without any trouble.  To do that, you have to disregard the tax-credit.  Pretending that has no influence is important... and nuts.  Yet, some continue to try anyway.  We'll get concluding comments like this on a regular basis: "...the marketshare of hybrids has remained stagnant for years."  In reply, I pointed out some marketing principles and mentioned the inevitable plateau that comes as a result of competitors not joining in yet.  I also made it clear that sales of the gen-4 Prius only just began.  This was the response to that today: "The numbers I provided were for all manufacturers, but glad to see that you still found a way to spin this in a positive light."  It came from someone who simply seems angry and doesn't want to support hybrids anymore, consequently turning against them... by misrepresentation.  That's really unfortunate.  It does happen though.  Disenchantment is a very real problem.  Oh well.  What can you do?   I posted this:  GM, Chrysler, and Nissan are major automakers that don't offer any hybrids.  There's smaller automakers too, like Mitsubishi.  The number of hybrids coming from Honda, VW, and Subaru are almost non-existent.  Look at the top-selling category, small SUVs.  There is only the RAV4.  There aren't any hybrid minivans here.  For that matter, there's only one sub-compact available.  The market is most definitely lacking choices still.  Thinking that's representative of "all" is serious denial.


Prius C Refresh.  This morning, my wife and got a surprise.  We spotted a new color of Prius C racing past us on the highway.  Looking closer, we noticed some cosmetic differences.  I hadn't realized Toyota would be doing a refresh of the model.  That usually happens mid-cycle.  But with the future of it uncertain due to the ever-changing market.  That makes sense.  There's a wait-and-see approach right now.  RAV4 hybrid seems to be quite popular.  The new Prius gives that impression too, but there haven't been enough available for purchase yet to really make any type of demand assessment.  People like to gauge success based on small samples, limited time & area.  I try to always point out the bigger picture.  For example, Prius C in Japan (known as "Aqua" there) is no longer the top-selling vehicle for the country.  The regular liftback Prius has surpassed it... by quite a bite.  21,036 verses 12,720 in January this year.  In February, it was 19,010 verses 14,010.  In March, sales were an impression 21,434 verses 23,314.  That shows there's a huge demand for the new Prius there, but the refreshed C is clearly hanging on to the second place title.  Will there be a next-generation that resembles the C we become accustomed or will there be some other smaller hybrid offering instead?  After all, the ultimate goal is to phase out traditional choices.  That means approach adjustments as the market grows is a reasonable expectation.


2016 Prius Sightings.  I've spotted several on the road now.  Woohoo!  It's nice to know that, despite the nasty fire causing lots of damage at a steel production plant, the new Prius are finally becoming available.  The timing of that was really unfortunate.  Things like that mess up advertising campaigns.  It makes you wonder how many people went into dealers hoping to take a close look at the new Prius were sent away in disappointment from there not being any.  Not much could be done about that.  It likely hurt initial interest in the RAV4 hybrid too.  Oh well.  At least a few people around here have been able to purchase.  I was at my dealer a few weeks ago.  They had 3 recent deliveries and none in the usual area.  Seeing 20 in back and a half dozen in front is normal there.  Shortages aren't good.  Hopefully, that situation has changed quite a bit since then.  I'll have to stop soon.  I've been yearning to get an inside look.  My first was at another dealer, where there were only 2 and that was after hours.  I regular visit would be nice.  I really look forward to the test drive.


Extreme Mistake.  The reaction to Tesla's recent enormous success has been interesting (Model 3 reservation count had already hit 115,000 by the time the reveal had concluded and continues to rapidly climb).  This is what I get presented with: "Obviously, Toyota thinks this is a fad.  Toyota's senior leadership has stated that.  That is an extreme mistake."  Those saying things like that have already made of their mind.  So, it's pointless to attempt some understanding.  You can try though, as an exercise demonstrating the situation as a whole has been carefully considered:  That's called drawing a conclusion based on anecdotal evidence.  Don't get hung up on the first 4%.  Stepping back to look at the bigger picture, this natural progression to the next stage should be relatively easy to see.  Focusing on just those who participated so far means not seeing the other 96% of the market.  What are the consequences of the supposed mistake anyway?  First by no means equates to everyone else failing.  For that matter, it doesn't guarantee success either.  Just look at how horribly wrong both Two-Mode and Volt were for GM. Sales were a major struggle, despite being first and supposedly best.  Tesla will most likely do well.  Some of that simply comes as a result of being able to dedicate resources.  They don't have any legacy technology to deal with, nor customers demanding to purchase it.  Toyota does.  Traditional production must continue while new territory is explored.  They'll use that to seek out opportunities about to reach those other 96%.  The market is enormous and there is a great deal of potential still.  True, we will see pressure forcing approaches to change.  But don't go writing up an obituary upon the first sign of another automaker's success.  We only recently finished the first inning.  Look at the entire market.  The gen-2 rollouts have just begun.  The mainstream consumer hasn't even been a participant yet.  The attitude of pushing EV range accomplishes what?  Sure, it captures interest.  But how does that improve motor, controller, and battery technology.  Any plug-in offering will deliver that needed data.  In fact, the less there is to work with, the greater the engineering effort to compete.  Go ahead and congratulate Tesla.  Those orders are an amazing achievement.  That recognition is well earned.  But don't declare the other approaches to deal with emission & consumption issues until there's something actually showing high-volume profitable sales haven't happened.  The low-hanging fruit doesn't represent what comes next.


Get Over It!  Ugh.  Reading this in the past would have been frustrating: "...buying tired-old HSD ( it's good as a hybrid, but Voltec us just far better )."  Now, it serves as vindication.  I see it as confirmation of having studied both the engineering & business need well.  Seeing the explosive post as a result of pointing out that was a provoke really showed that well.  It certainly was over the top.  He went on and on.  The rant was rather entertaining to read.  My reaction was quite different:  The extreme over-reaction to such an obvious provoke that didn't work was quite telling.  Putting me on the defensive invites the opportunity to ask why.  So, let's do that, starting with a look back at the history...  Back when Volt first rolled out, there were a number of problems to deal with.  Volt enthusiasts felt overwhelmed by a variety of unexpected barriers and ended up taking a defense stance.  There was a very real belief Volt production would end.  Fortunately, the consensus ended up being to promote gen-2 rather than dwell on what had become very difficult market issues.  They believed GM would continue to invest in the technology, to make that next rollout the strong-seller they had hoped for.  As that was happening, a great deal of effort was expended to make people believe the same could not be done by Toyota for the technology in Prius.  It was a blatant double-standard.  Volt enthusiasts disregarded facts and did what they could to belittle & mislead.  That was astonishing to witness... and went on for many years.  Last week, the next generation of plug-in Prius was revealed.  It confirmed that Toyota could indeed upgrade the system.  The technology was not old, tired, or obsolete.  Right there, for the whole world to see, was a design improvement which exposed certain individuals as being hypocritical.  That's an uncomfortable situation.  It's understandable why some would lash out in anger.  My suggestion to that situation: GET OVER IT!  I've worked really hard to bridge the divide, to extend a hand in friendship.  Ultimately, our goals are all the same.  We want the plug-in technology we support to be purchased by large numbers of consumers.  Look at what Toyota actually did.  A clutch was added to the system, allowing the gas engine to disengage.  The result is the ability to use both electricity motors for propulsion.  Combined with a larger battery-pack, power from the system was significantly increased.  This was something scores of stubborn Volt enthusiasts claimed was impossible.  Perhaps that's why Toyota's promotion of the next generation Prius was titled: "Beyond Possible".  That brings us to today.  I'm tired of the nonsense and will continue to point out wasted effort of pretending the real competition isn't traditional vehicles.  Look at the facts.  Those gas-guzzlers are outselling the hybrid & plug choices by an extreme.  Want to over-react?  Do it in frustration from that.


What They Thought.  Ironically, we're starting to see the situation that Prius faced and dealt with now arising for Volt... consumers not actually buying what they thought they wanted.  For many years, there was a common call for added battery-capacity and a plug, to supplement the existing system.  The purpose was to boost MPG.  Aftermarket conversions proved the approach.  Toyota ended up delivering a version improved upon that.  Unfortunately, the idea wasn't embraced by the masses.  Fortunately, it was a mid-cycle rollout to only limited areas.  So, there was very little risk or fallout.  That meant delay for wide-scale availability but also meant the opportunity to build upon real-world data collected in the meantime.  Prime is the result of that.  GM is still going under the assumption that maximum EV and minimum HV is what people will buy in large quantity.  We've been told by enthusiasts that is the purchase priority.  We've await to set that from ordinary consumers.  That disassociation of saying & doing is nothing out of the ordinary.  In fact, it is quite common.  Problem is, this situation comes with a substantial penalty for the business upon assuming incorrectly.  Put another way, Toyota altered design from only one of the two motors providing propulsion power to both.  That allowed the system to offer more EV, but not tradeoff HV performance.  This was due to the market revealing a lack of understanding of how plug-in hybrids work.  Most people believed the vehicle would operate as an EV until depletion.  The concept of blending wasn't understood.  Since that's the way Volt always operated, there was much rejoicing among enthusiasts.  It didn't translate to the massive success that had been anticipated though.  Like with Prius, it addresses what people had been requesting.  But interest from those ordinary consumers hasn't materialized yet.  Will it be embraced by the masses or will some type of adjustment be needed?  Consumers not actually buying what they thought they wanted is a very real problem.


Inferior.  The attacks never end.  Having to deal with the rhetoric is a pain: "We, as in Volt supporters, have always been fighting for plug-in acceptance. You argued against the Volt since day 1, saying it was inferior to the Prius hybrid."  They look for scapegoats, then paint a picture for others to believe.  It's always vague.  It's always an extreme.  It's always dishonest.  In this case, I couldn't help but to chuckle, since this was included afterward: "If sales are the measure of success..."  That bit of uncertainty is absurd.  We've been talking about sales as exactly that since long before day 1.  The specific count & timing was concise.  There was never any doubt how success would be measured.  But when the actual numbers began falling well short of those expectations, goals were changed.  They said that wasn't important.  Ugh.  I kept my rebuttal fairly short, to force the bigger picture:  No matter how many awards any particular technological achieve earns, that's just engineering if sales aren't accompanied too.  Not agreeing on that point has been the basis of misunderstandings and disagreements for years.  We've all given and acknowledged engineering achievements Volt delivered, then most of us moved onto the business part.  That's sales.  It's time to focus on getting mainstream consumers involved.  The niche stage is over.  The enthusiast engineering-only perspective isn’t enough.  Gen-2 is now available.


Stats.  Eventually, we'll have real-world experiences to share.  Until then, it's stuff like this: "I'll be curious to see what the stats are for the Prime.  For me, I'll be plugging in the Prime every other day (taking into account side trips to the supermarket and not strictly commuting)."  Driving circumstances & conditions vary so much, there isn't much realistic speculation possible.  I still remember some posts prior to Prius PHV being rolled out.  A few have left rather vivid memories.  We simply didn't know.  This time around, we have background with respect to plugging in available.  Here's mine:  I'll be going from a 125 MPG commute average to around 999 MPG.  I plug in at work, taking advantage of the huge (85 kWh) solar-array for recharging.  My commute is 38 miles round-trip.


Doubt.  Some people thrive on it, stirring discussion by raising some.  Oddly this time, the situation is reversed: "I think the shock about 4 seats is that there is no denying Toyota is trying to go for a different market than the Prius, which might be counter to what many think of the Prius family."  Who knew that this was come about?  I certainly didn't expect it from that particular individual.  His contributions typically draw out discussions and prevent conclusions.  I wonder why this particular situation had a very different response.  But then again, maybe it was some type of reverse provoke.  So, I took it as bait.  After all, that use of "think" was a little suspicious:  Why raise any doubt?  We already know Toyota is reaching out to new consumers.  I suggest looking at Prime as another offering, not a plug-in version of Prius liftback.


Flexible.  What comes to your mind upon reading this: "Toyota did a poor job of explaining that the Prius Plug-In was meant to use even less gas than the Prius with the help of electricity from the grid, not to provide an EV driving experience."  Not filling in the all blanks is how you learn, since it results in feedback.  Of course, being somewhat ambiguous and not responding when false beliefs emerge is an entirely different matter.  That happened with Volt, prior to rollout.  Toyota didn't do that until after Prius PHV was rollout out.  Big difference.  Prius PHV owners could answer questions, simply by trying.  They'd report their own real-world observations.  Since no one owned a Volt yet, real problems emerged for GM.  Rather than serving as an educational means, like it did for Toyota, things escalated out of hands based on nothing but speculation.  Put shortly, any "poor" judgment depends on when events take place.  There's an added advantage of not providing what could potentially become false hope based upon speculation.  It's flexibility.  I put it this way:  That was intentional.  They wanted to study market response as a whole, rather than pushing any particular approach.  No matter how many times it was pointed out that Toyota wanted to remain flexible, some people just plain didn't want to accept it.  In fact, their response was usually to call people pointing that out defenders trying to spin the situation.  That was annoying, but now we have confirmation of it being the case... which has rendered most of the naysayers silent.  This is why gen-1 rollout expansion was postponed, then production ended entirely.  Looking back, it should be fairly obvious the market was quite fickle and really not certain what it actually wanted.  Remaining flexible offered opportunity.


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