Toyota's Customer Loyalty Is Falling And It's All Tesla's Fault

Good morning! It’s Wednesday, June 28, 2023, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.

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1st Gear: Ford And Chevy Sitting Pretty, Toyota Falling

S&P Global Mobility has published its ranking of loyalty across mainstream brands for 2023 thus far, and something’s amiss. See, Ford, Chevrolet and Toyota usually land in similar spots on the list, and this go-around, Ford and Chevrolet found themselves at the very top. Great news for them. Unfortunately for Toyota, it slid to seventh place, also behind Subaru, Nissan, Kia and Hyundai in that order. S&P has a theory as to why. From Automotive News:

Toyota is typically “neck and neck” with Ford and Chevrolet, analyst Tom Libby said during a webinar held by S&P. Ford recorded 59.5 percent brand loyalty this year through April, followed by Chevrolet, at 57.1 percent, and Subaru, Nissan, Kia and Hyundai. Toyota was down 5.7 points from the same time last year to 52.3 percent.

“We will obviously have to watch the results going forward, but just in these first four months, Toyota is a disappointment,” Libby said.

Though Ford topped the ranking, the brand essentially matched its loyalty from the same time last year, while Chevrolet was up 2.6 points.

The percentage of customers who migrated from Toyota to Tesla was up 2.1 points to 5 percent year over year.

Though EV sales remain small for many brands, “there’s no doubt that Toyota, Honda and some other Asian brands are being impacted tremendously by Tesla,” Libby said.

Tesla’s stealing everyone’s repeat customers — even those of mainstream makes — which is one of several reasons why I’m not entirely sure it deserves the title of “luxury brand.” But interestingly, Toyota’s taking that hit harder than its two American rivals. The fact they offer moderately successful EVs and Toyota has only the bZ4X might have something to do with it. As of May, Toyota only moved 3,043 of those, per data from GoodCarBadCar.

Meanwhile, Honda is nowhere to be found in that set of top seven, while kudos has to be given to Nissan, which somehow took the No. 4 spot. If you asked me how loyal I expect the average Nissan customer is, I probably wouldn’t say second only to Subaru’s and more than those of Toyota and Honda. Maybe it’s not all bad for Nissan…

2nd Gear: Nissan’s Neverending Executive Drama

…which brings us to today’s 2nd Gear, and Nissan’s announcement that it will not fill the vacancy left by former chief operating officer position Ashwani Gupta. Gupta left Nissan today, and there are an abundance of weird vibes and circumstances surrounding his departure. From Reuters:

Responsibilities previously carried out by the operations chief will be taken over by other executives, it said.

Hideyuki Sakamoto, executive vice president in charge of manufacturing and supply chain management, will be responsible for purchasing. Chief Financial Officer Stephen Ma will take over operations performance duties.

“In response to the constantly evolving market conditions, we will introduce a flatter and agile leadership structure, which will further empower regional and functional leadership,” Nissan CEO Makoto Uchida said in a statement.

Nissan said earlier this month Gupta would leave the Japanese automaker to pursue other opportunities, following an announcement he would not be reappointed to the board of directors at the end of his term. His last day at Nissan was Tuesday.

Meanwhile, a senior advisor at the automaker has claimed that CEO Makoto Uchida surveilled Gupta “over a long period” because Uchida supposedly believed Gupta stood in the way of the revised deal he sought with partner Renault. That whole affair is now being investigated by an “independent third party,” the company’s confirmed. Again, Reuters:

The surveillance claims, first reported by the Financial Times, were made by Hari Nada, 58, a senior adviser at Nissan, in a letter dated April 19 to the independent directors on the Japanese automaker’s board.

Reuters, which has reviewed the letter, is the first to disclose its specific details. They relate to the surveillance claims, a stark split in senior management over Nissan’s relationship with Renault and concerns about transfers of intellectual property to the French carmaker.

In the letter, Nada said Uchida carried out surveillance over a long period. Nada said it was an effort to acquire leverage to remove an executive and board member the Nissan chief executive regarded as an obstacle to reaching a new deal with alliance partner Renault.

Gupta, appointed chief operating officer in 2019, had questioned the terms of the revised agreement Uchida is looking to finalise with Renault, according to Nada’s letter and the four people with knowledge of the matter.

This is all wild but, with Nissan going through all of it over the last four years, I suppose we shouldn’t be surprised at this point. Look: I’m not going to say that Carlos Ghosn did or did not deserve what came to him, but all I’ll say is that Nissan execs have made it very clear that they are loath to fuck around.

3rd Gear: Edmunds, CarGurus <3 ChatGPT

In today’s installment of “oh, good,” we have news that everyone’s favorite purveyor of misinformation, ChatGPT, is now being utilized by Edmunds and CarGurus because accuracy isn’t worth having to pay copywriters. From Automotive News:

The Edmunds ChatGPT plug-in helps consumers in their car purchasing decisions by offering access to original expert vehicle reviews and local inventory. It is available now to all ChatGPT Plus users in the ChatGPT plug-in store under the name “Edmunds Cars.”

Once the Edmunds plug-in is enabled, users can converse with ChatGPT as usual. When a car shopper asks a question better handled by Edmunds’ real-time data, ChatGPT will call on the plug-in to give a more complete and accurate answer.

“The benefit of using ChatGPT is twofold: it is an incredibly powerful large language model and has an active user base. OpenAI is one of the fastest growing consumer applications in history and provides Edmunds an opportunity to meet shoppers where they are starting their car searching journey,” Nick Gorton, Edmunds’ chief innovation officer, told Automotive News.

CarGurus created a ChatGPT plug-in that allows users to ask broad questions about the automotive products they are interested in and get results of the most relevant cars available to their search. The plug-in can gather data from a large selection of both new- and used-vehicle listings.

ChatGPT said I died three years ago.

4th Gear: Zeekr To Europe

Zeekr, the electric carmaker under Geely’s umbrella alongside Volvo, finally landed in Europe this week — where else but in the EV havens of Sweden and the Netherlands. Via Electrive:

Zeekr now announces that the Zeekr 001 will be available in the Netherlands and Sweden from 59,490 euros ($65,000) and 667,000 SEK, respectively, and the Zeekr X from 44,990 euros ($49,000) and 550,000 SEK. These are gross prices including local tax. They apply to the single-engine version with a 200 kW engine on the rear axle. In the Zeekr 001, this is combined with a 100 kWh battery, which is said to provide a WLTP range of up to 620 kilometres. In the Zeekr X, a battery with 69 kWh capacity is installed for a range of up to 440 kilometres.

Deliveries of the electric cars in the Netherlands and Sweden are scheduled to start in autumn 2023. Zeekr’s first European branches are planned for this year in Amsterdam and Stockholm. After that, other European countries and models are to follow “quickly”, Zeekr had already said when announcing its European expansion in April. In the current announcement, the Geely brand is a little more precise: the goal is to “expand into most countries in Western Europe by 2026”, according to the manufacturer. Concrete countries are still not mentioned, however.

You shouldn’t hold your breath for Zeekr to bring its wares stateside, though that is what Geely has Volvo for, after all. The Zeekr X and $35,000 Volvo EX30 just so happen to share platforms.

Reverse: The Beginning Of The End Of Smart In The US

On this day in 2006, 17 years ago, DaimlerChrysler tried to get Americans excited about the smallest car possible:

Neutral: Where Does Your Loyalty Lie?

Consumer loyalty is a complex thing, and we all have factors — rational and irrational — that influence our purchasing habits. What makes have you been mostly loyal to throughout your driving and wrenching tenure?