June 2013 Sales Conference Notes

June 2013 Sales Conference Call
Tuesday, July 2, 2013

June 2013 Sales Conference Call Audio

Toyota Motor Sales Vice President of Corporate Communications Mike Michels:

Hello everyone and thank you for joining us to review Toyota’s June and mid-year sales results.

Speaking today will be:

Bill Fay, Toyota Division group vice president and general manager
And for Lexus we’re joined for the first time by Steve Hearne, vice president of sales

Following the call, our communications team will be available to field any additional questions you may have.

Now I’d like to turn it over to Bill for a look at June results.

Toyota Division Group Vice President and General Manager Bill Fay:

Thank you Mike…and thanks everyone for joining us today.

As you know by now…

Industry had a great month in June

Sales of more than 1.4 million
up 9 percent from last year on volume basis
One additional selling day last year
Even better on an adjusted DSR basis, +13 percent
Easily best June in six years (2007)

Pushed SAAR to 15.9 million for the month

Impressive jump of 600,000 units from May SAAR
Within shouting distance of the magic 16 million mark

Midway through 2013

Industry sales closing in on 8 million units
SAAR solid 15.3 million
Expect momentum to roll into summer months

Economic fundamentals remain strong

Consumer confidence, housing and employment
- All hit 5-year highs during the past couple months

Industry fundamentals also strong

New products continue to bring people to showrooms
Appears to be no let up in pent-up demand
There remains a wide range of excellent financing options

Toyota, Lexus and Scion in June

Strong and sustained demand throughout the month
Total sales of 195,235
- Up 9.8 percent from last year
- 14 percent on DSR basis
- Ahead of industry pace for the month

From here on, straight volume percentages

Toyota Division

Sales of 173,880
Up 10 percent from last year
Toyota Division again #1 retail brand in June

Toyota also #1 retail brand midway through 2013

Big month for Camry

Sales of 35,870
- Up nearly 12 percent from last year
Just yesterday sold Camry No. 10 million
- Went on sale 30 years ago
- Nearly 6.5 million of those cars still on the road
Helped make Camry best-selling car for the month

Midway through 2013
- More than 20,000 units ahead of second place car
Camry also was ranked as the #1 mid-size car in J.D. Power’s Initial Quality Survey

Prius also up for the month

Up 10 percent
More than 21,000
YTD more than 120,000
Right on track to hit our target for the year

Total Toyota Div. hybrid sales up nearly 20 percent for the month

After six months, continue to account for more than half of all alternative fuel vehicles sold

Avalon sales nearly tripled for the month

For the year, new Avalon running at double the pace it set a year ago

Corolla

Sales of nearly 26,500
Flat on a volume basis (actually up 3 percent on DSR)
Sell-down of the current model going extremely well
In fact, sales up about 5 percent for year
- Best-selling subcompact model YTD

Showed 2014 Corolla for first time in early June

Early reaction has been especially strong
Already recorded more than 500 million media impressions
Production begins in August
Excited to add to our lineup soon afterwards

Moving to our truck results

Toyota Division up 13.5 percent for the month
More than 400,000 during first six month
- Up 12 percent first half of 2013

RAV4 volume leader

Up 36 percent last month; more than 20,000
Best-ever June
Since went on sale in January
- New RAV4 has 5 record months
- Sold more 100,000 during the first six months
  - First time that’s ever happened
  - Up 13 percent for the year
- Still trying to build inventory

Pickup sales up 13.5 percent in June

Tacoma up 18 percent
Tundra up 12 percent
Through first six months
- Combined pickup sales up 18 percent
- Slightly ahead of the segment’s growth rate (about 15 percent)

Sienna up more than 9 percent for the month

Highlander up 7 percent

Sales of both models top 60,000 units midway through the year

Toyota Certified Used Vehicles

Continued its string of record-setting results
Now set a new record every month this year
Sales of more than 32,000 up 12.5 percent

Looking Ahead
The auto industry has led the economic recovery through the first half of 2013 and we believe that will continue in the months ahead.

Toyota well-positioned to take advantage of this growth

Core models,
- Camry, Corolla, Prius and Tacoma retain leadership positions
Newest models,
- RAV 4 and Avalon, off to excellent starts

And we’ll roll out three all-new or significantly updated models between now and the end of the year to help keep the momentum going, beginning with Corolla this fall.

Thanks again for joining us today and now I’d like to turn this over to Steve for a look at Lexus.

Lexus Vice President of Sales Steve Hearne:

Thank you Bill.

I’ll get to the June breakout for Lexus in a moment…but the big news for us in June was the launch of the all-new IS lineup, which went on sale Friday.

The marketing launch actually started in mid-June, with a heavy emphasis on the new design, driving dynamics and technology advancements of the IS.

It seems to have made a connection with customers, as we sold more than 500 in just three days

Many of those customers came looking for the new IS F Sport with its bold design and sporty performance.

It helped give us to the best non-holiday weekend for Lexus in six years.

Pushed Lexus sales above 21,000 for the second straight month

Third time in last four month

Total June sales of 21,355

Up 6.7 percent on straight volume basis

YTD, sales up about 10 percent

At nearly 120,000 vehicles

The two other new cars in our line-up – the ES and LS – posted strong gains in June and both models
continue to show the biggest increases in their respective luxury segments.

ES

Up 50 percent in June
Sales of more than 33,000 thru first six months
Up 83 percent for the year

sales up 45 percent for the month
Up 73 percent for the first half
LS also received the highest score among all models in J.D. Power’s IQS – for the sixth year in a row.

The SUV side of our business

RX continues to be the best-selling vehicle in our lineup
- Sales of more than 8,600 in June
- Year to date sales up 4 percent
- Continues to lead luxury SUV segment
GX also had a good month
- Saw sales climb 9 percent for the month

Lexus Certified Pre-Owned

Four consecutive record-setting month

We expect the IS fireworks to continue in July

All IS models currently at dealerships, including F SPORT version
Availability will improve throughout the month

Combined with ES and LS, that will give us three of the hottest models in the growing luxury sedan market.

Thank you very much for joining us today and now I’d like to open up the call for questions.