Carmaker shows off new version of vehicle traditionally used by Japanese royals and CEOs
3 min
TOKYO—Toyota thinks the world outside of Japan may finally be ready to embrace its six-figure super luxury flagship car.
Toyota’s Century—often described as the Rolls-Royce of Japanese cars—is a frequent choice of corporate chieftains and government leaders in Japan, including the emperor.
Since it made its debut in 1967, the Century has been sold almost exclusively in Japan and the model has changed little from its original boxy sedan shape and classic styling.
Toyota on Wednesday showed off a new, larger, plug-in hybrid version of the model that “from the start had its eye on the world,” Executive Vice President Hiroki Nakajima said, speaking at the unveiling event in Tokyo.
The new Century model will be introduced this year in Japan at a suggested retail price equivalent to around $170,000 and will be offered to customers in all regions of the world, Nakajima said. Toyota said select dealers in Japan would sell the model but didn’t describe sales procedures in other countries such as the U.S.
With its new Century, Toyota is targeting two segments—larger and luxury vehicles—that have continued to grow despite stagnation elsewhere in the car market. Until now, Toyota has primarily served the luxury market through its Lexus brand.
In 2022, global sport-utility vehicle sales grew 3% from the year earlier despite a slight decline in overall car shipments. That was due in part to strong demand for the vehicles in the U.S., India and Europe. Demand for luxury cars has also continued to rise through recent economic uncertainties.
One thing that won’t change is Toyota’s practice of having specially trained workers hand-make and customise the Century models in Japan. For now, Toyota said it wouldn’t produce more than 30 of the new Century models a month in addition to the existing sedan type it also continues to manufacture.
That means the new Century will likely have a bigger impact on Toyota’s brand image than its bottom line. Nakajima said the Century is a way to show off Toyota’s craftsmanship. He said details of overseas rollout plans would be determined based on initial reactions from customers.
Through the decades, Toyota’s Century has gained a following for being a decidedly Japanese take on a superluxury car. While little-known to most Toyota buyers in the U.S., it has attracted a following from some car enthusiasts such as comedian Jay Leno, who featured the model on a 2018 episode of his car-review series.
The vehicle’s grille features a badge inspired by the golden phoenix that adorns the Temple of the Golden Pavilion in Kyoto. The exit from the rear passenger cabin is lowered so that a person wearing a ceremonial kimono can easily get in and out.
It targets the Japanese upper crust who want to broadcast success, but not in a flashy way. The styling is boxy and understated, typically black with chrome accents.
When introducing the most recent iteration of the Century in 2018, Toyota said it had no plans to sell the vehicle outside of Japan because it didn’t think the car would appeal to foreigners.
The new models presented on stage Wednesday were a departure from the Century’s original styling—similar in shape to an SUV and showing a range of silver and gray shades.
Still, many of the Century’s interior features designed for chauffeured passengers remain. Those include rear seats that fully recline.
Chief Branding Officer Simon Humphries said the new Century was designed to maintain “the highest of Japanese sensibilities,” while also keeping in mind that customers are changing. The roomier new Century is designed for passengers who want to join online meetings from the back seat of their cars and drive without producing emissions, Toyota said.
“It’s a Century for the next century,” Humphries said.
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Apple’s growth engine is showing signs of slowing, as rising costs, weaker services growth and AI competition challenge its profitability. With John Ternus taking the helm, the pressure is on to reignite innovation and sustain investor confidence.
3 min
The Apple growth and profit machine is wavering, and the boost from price increases might not be enough to keep it going at historic rates. That dials up the pressure on Apple’s new chief executive, John Ternus.
The company saved the bad news for its earnings call, an hour after it posted its results for the September quarter, projecting that for the current quarter its high-margin services business will continue to slow and that its widely watched gross profit margin will continue to fall.
Apple AAPL -1.83%decrease; down pointing triangle shares had been flat in post-close trading but declined as much as 4% after the company made the projections, which fell short of Wall Street estimates.
The impact of high memory costs are weighing even more heavily on the company, Ternus and Apple Chief Financial Officer Kevan Parekh said on the company’s earnings call. Apple has stockpiled cheaper components purchased earlier, but those inventories are dwindling.
When Ternus took over as Apple’s third chief executive of the past 29 years on Sept. 1, he inherited sky-high expectations. The men he followed were among the most successful company leaders in American business history. Steve Jobs revolutionized consumer devices multiple times. Tim Cook expanded Jobs’s creation to spectacular heights.
The expectations are reflected in Apple’s huge valuation. Oppenheimer analyst Martin Yang noted that Apple stock trades at 36 times next year’s expected earnings, a premium to the overall market, even though its earnings are only expected to grow 1%, which is slower than its tech peers.
“We see insufficient upside to justify the premium,” Yang wrote in an investor note, adding that Apple needs to boost iPhone sales growth and turn around its slowing services business to make him more bullish.
Investors have bid up Apple shares because it has been a port in the AI storm—a reliable and capital-efficient business that stands apart from rivals which are spending hundreds of billions of dollars racing to the AI frontier.
While others invest in data centers, Apple has been pouring its own cash into buybacks and dividends. But that safety may be challenged if Ternus can’t speed up Apple’s innovation engine.
Apple’s lagging performance in AI was evident when its new “Siri AI” chatbot arrived this past quarter. Its long-maligned assistant was already stale the day it arrived, surpassed by agents such as Instinct and Muse that can complete multistep tasks for consumers, while Siri still sets kitchen timers.
Apple needs to give people reasons to buy its devices as they get more expensive. The company raised prices across the board last quarter to help offset higher costs. Without compelling new features, a big question is whether consumers will slow the frequency of iPhone upgrades.
The new iPhone Duo appears to be a bright spot. Consumers are scooping up the $1,999 foldable smartphone despite mixed reviews—so many that Apple can’t keep up with demand. Shipping dates jumped out to January soon after the device went on sale, a disappointment for the normally reliable Apple supply chain.
Apple said its revenue grew 12% in the September quarter, slightly ahead of Wall Street’s expectations. Its widely tracked gross profit margin, at 47.9%, also came in just ahead of analyst estimates.
Apple will need to find new growth avenues because a reliable engine during the Cook era—the services business—is slowing. Courts and regulators worldwide have limited Apple’s ability to charge developers big fees to distribute apps through its App Store, the biggest component of the company’s services segment.
One of its most lucrative App Store fee generators has been the ChatGPT app from OpenAI. Around the time Apple accused OpenAI of trade-secret theft this past summer, OpenAI began redirecting potential subscribers to pay via its website instead of the App Store, skirting Apple’s tollbooth.
Apple’s valuation has bumped up against a ceiling in recent weeks. Six times it traded above a $5 trillion market capitalization intraday before finally closing above the threshold, which it has already fallen back below.
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