Brand Relevance: Making Competitors Irrelevant - always yours

MARKET DYNAMICS IN THE AUTOMOBILE INDUSTRY 105
be driving a hybrid. You do not make a statement by buying a
Civic or an Escape.
Further, the technology was expanded to other models, such
as the Camry, the Highlander, and the Lexus. As a result, Toyota
had sold over 1.7 million hybrids worldwide by 2009 and had
close to a 79 percent share of the hybrid market. Also, the Prius
enhanced Toyota ’ s position as the most innovative brand in
Japan and the most environmentally sensitive. Toyota has done
many things in its factories and social programs to merit both
claims. But it is the Prius that became a highly visible statement
of Toyota ’ s culture and values.
Where were Honda and the others? Honda actually introduced
a hybrid into the U.S. market before the Prius. It was the
Insight, a two seater that was in production from 1999 to 2006.
During that time it sold only eighteen thousand units, so it was
more of an extended test than a serious entry. In 2002 Honda
introduced the Civic Hybrid, a more serious entry, but one that
was tied to the Civic brand, which had a lot less energy than the
Prius brand and struggled with 10 to 15 percent of the hybrid
market. In 2009 Honda introduced another hybrid, under the
brand Insight, meant to compete with the Prius in the U.S. market.
However, the Insight, which challenged largely on the basis
of price, had a disappointing start, perhaps because Prius buyers
were not allowing price to dominate their decision making. 6 At
least for the fi rst decade, Toyota won both the technology and
marketing battles.
Ford was the fi rst U.S. manufacturer to release a hybrid,
the Ford Escape hybrid SUV, which appeared in 2005 and was
also the fi rst SUV hybrid. Ford trailed Honda in the marketplace,
however, and the other U.S. manufacturers were nonfactors.
GM, after disparaging hybrids for years, in 2004 created a
partnership with DaimlerChrysler to produce hybrid vehicles in
2006 that, at least initially, made little impact on the market.
Toyota dominated the compact hybrid subcategory for over
a decade because of its ongoing innovations, both incremental