When Didier Leroy became president of Toyota Motor Europe in 2010, he discovered the company sold a record 1.1 million vehicles at the end of the last decade but earned no profit.
Now, although only about 800,000 vehicles are being sold, the business is profitable. Among other things, sales of hybrid vehicles powered by a conventional combustion engine and an electric motor have helped. A third of sales of the compact Yaris and half of the midsize Auris are hybrid models. “That shows we are profitable in this technology,” said Karl Schlicht, Mr. Leroy’s deputy.
This year, sales are up 20 percent compared to last year, and the global total may even reach an all-time high.
But with Europe facing a likely slowdown in the coming year, there is no guarantee of further profitability. “We cannot advance with the magnitude of the German premium manufacturers, but if we could sell between 80,000 and 100,000 vehicles in Europe, that would be fantastic,” Mr. Schlicht said, adding that European sales in 2015 might rise by another 20 percent.
Toyota has changed considerably in the past few years, particularly when it comes to design. A striking remodeled front section has scared off some mainstream customers, but improved sales overall. Toyota admits it was too conservative with design in the past.