Video [9:49 min]: The Rise and Fall of the Toyota Prius

Toyota revolutionized the hybrid market with the introduction of the Prius, but over time, the value of this car to the buyer has declined, as evidenced by falling sales.

Review Exhibit 11.6 from How New Products Are Developed in Section 11.7, and compare the story of Toyota’s past success with the Prius hybrid car to the current situation, as reported by CNBC in the video.

Annual US Sales of Prius - introduced in 2005

2005: 107,155 - debut
2007: 181,221
2009: 150,831
2011: 136,464
2012: 236,655 - peak in sale volume
2014: 207,372
2016: 136,629
2018: 87,590 - first time sales dropped below 2005 debut.
2020: 43,525
2022: 33,352
2024: 44,711

Obviously, Toyota did something really right in the past to become the iconic leader in hybrid vehicles. Which steps in the 6-step process explained in Exhibit 11.6 do you think Toyota’s management were particularly skilled to figure out back then? Most of the 6? Perhaps even all of the product development process?

What happened, as described in the video to challenge the leadership of the Prius? Were some of the factors that have hurt the sales of the Prius truly out of the control of Toyota, such as gasoline prices. What about the actions of competitors? Even if Toyota had quite a few problems in the external environment that ultimately contributed to the decline in Prius sales, couldn’t they just use the same product development process to modify the Prius or create a new vehicle that would be successful?