[January 15, 2014]DETROIT (Reuters) — Asian rivals Toyota
Motor Corp <7203.T> and Kia Motors <000270.KS> unveiled concept
sports cars this week that appear to target different demographics
but share a common goal to add some sizzle to their brands.
Toyota said the FT-1, a muscular-looking coupe unveiled Monday at
the Detroit auto show, would deliver the type of heart-pumping
performance CEO Akio Toyoda has complained is lacking in its fleet
of reliable but predictably designed cars.
Toyota said it was not sure whether it would take the car into
production and did not disclose specifications. But analysts believe
it is plotting a return to the segment after discontinuing the Supra
more than a decade ago, and that it will likely produce a
high-performance model catering to a well-heeled clientele.
Kia, meanwhile, appears to have a younger client in mind with its
315-horsepower GT4 Stinger, which also had its debut at the auto
show. It cited the Mazda MX5 and Scion FR-S — a Toyota offshoot
brand focused on young customers — as possible competitors down the
road.
"I don't see this concept competing with Porsche or Ferrari or
Lamborghini or something. There are other mass market brands which
offer sporty cars," Tom Kearns, Kia's chief U.S. designer, told
Reuters.
Toyota, the world's largest automaker, and Kia, a much smaller South
Korean affiliate of Hyundai Motors <005380.KS>, are in vastly
different stages of their development. But both see a sports car as
a way to invigorate their brands.
For Toyota launching a high-performance vehicle would bring an
excitement into their line-up that has been largely missing since it
called it quits on the Supra in the U.S. market in 1998, said
Edmunds.com analyst Jessica Caldwell.
"It has been accused of very boring, appliance-like cars. I think
they need to do something to shake it up," Caldwell said, adding
that she believes it should revive the Supra brand. "Older people
remember it, they like it."
While Kia doesn't have any track record in sports cars to build on,
it could have success if it is priced under $25,000 — putting it in
the same price range as the youth-focused FR-S, Caldwell said. She
reckons Toyota might look to compete at a higher price point,
somewhere between the FR-S and a Porsche.
Both companies seemed resigned to forgo the pursuit of big profit
margins in return for the elusive "halo effect" a high-performance
or trend-setting car can generate.
Jim Lentz, head of Toyota's North American operations, said Toyota
has had good results with that strategy in the past, such as with
the retro style FJ Cruiser SUV. But with sports cars demand can
disappear quickly after an initial spurt, he warned.
"Not to say that people don't do sports cars because of the halo
effect it has for brands. But in terms of the business of selling
cars and making money on cars, sports cars don't make a lot of
sense," Lentz said.
Hank Lee, vice chairman of Kia Motors, told reporters the sports car
concept is part of its efforts to launch another attention-grabbing
vehicle after its success with the Soul box car. He said it would
decide whether to produce the GT4 Stinger after evaluating consumer
response.
The GT4 Stinger, which features Kia's signature front grille,
vertical LED headlights and a swooping roofline, is the next logical
step in the company's development in the U.S. market, Kearns said.
While over the years Kia has transformed its image from a maker of
low-priced cars, it needs more excitement to drive traffic to their
showrooms, even if it means sacrificing some profits on producing a
sports car, Kearns said.`
"Even if you don't make a huge amount of money, it doesn't mean that
it is a failure because the way it changes your image, and attracts
a different type of customers that we don't have now," he said.
(Reporting by Nathan Layne and Hyunjoo
Jin; editing by Andrew Hay)
