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Move Over, Toyota Camry: There's a New No. 1 Midsize Sedan

Honda's Accord edged out Toyota's Camry in retail sales for 2013. Source: Honda Motor Company

Toyota's (NYSE: TM  ) Camry has long dominated the midsize sedan segment and has been known for its fuel efficiency, safety, and reliability during its 12-year stay at the No. 1 spot. While Toyota's Camry was again named the best-selling midsize car in 2013, that isn't the whole story. That ranking takes more into account than just sales to typical car buyers. In terms of sales to actual individual car buyers, or retail sales, another vehicle edged out the Camry for the top spot in 2013. In addition to that, other challenges loom for Toyota's Camry, and 2014 could be the year the king of the midsize segment is finally replaced, for good.

New king of the hill
Honda Motor Co. (NYSE: HMC  ) announced in a recent press release its Accord was the best-selling car to individual car buyers. In case you don't follow the automotive industry, there are really two ways to look at vehicle sales figures. Total manufacturer sales can be broken down into two major segments: retail sales and fleet sales.

Toyota's overall sales continued on top with more than 408,000 vehicles sold in 2013. However, its retail sales to individual car buyers accounted for only 342,007 units of that figure. The rest were fleet sales to rental companies or businesses. 

Honda has taken a different strategy, and a potentially more profitable one at that. Honda's Accord sold far fewer overall vehicles at 366,678 units; however, the Accord sold a vast majority -- 360,089, to be precise -- to individual car buyers. That makes Honda's Accord the most purchased vehicle in terms of retail sales to individual customers.

While Honda's Accord only owns the top spot in terms of retail sales, don't be surprised if the Camry loses its overall No. 1 position in 2014 as well.

Recalls and competition
For Toyota, an automaker that has long been known for reliability, it will face challenges holding up its reliable brand image after multiple, and massive, recalls. Consider that last year Toyota had three of the top five largest recalls in the U.S. market, and four of the top 10 according to's list of top 10 recalls. No other competitor owned more than one spot of the top 10 recalls. In total, Toyota recalled nearly 3 million vehicles with its four largest recalls. 

While recalls are simply a part of the automotive industry, the increasing number of public recalls for Toyota will have some effect on sales -- especially considering the company's largest recall in 2013 involved the Camry.

The 2012-2012 Camry, Camry Hybrid, Avalon, and Avalon Hybrid sedans had problems with the air conditioner condenser unit housing, which could cause a short circuit that could affect the airbags and power steering of the vehicles. The recall was served to roughly 800,000 vehicles.

In addition to the recalls, which could put a dent in sales of the Camry, Ford has recently stepped up its game with the Fusion and brought a more aggressive styling to the typically bland segment.

Graph by author. Source: Company specific sales reports.

If the Camry's competition, namely the Accord and Fusion, continue to gain steam, expect a new overall mid-size sedan leader -- and soon. Toyota acknowledges the issue and plans to address it with the next Camry design. "Camry's taken some hits on styling, but it's still selling well. But we need to create better design for Camry in the future," according to Kevin Hunter, Toyota's U.S. design chief, while at the 2014 Detroit Auto Show. We'll have to wait to see if the Camry's new design will be enough to keep its crown -- I have my doubts. 

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Read/Post Comments (32) | Recommend This Article (41)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On February 22, 2014, at 11:06 AM, Pablocruse wrote:

    Looks like every other car does nowadays. Short, sloping little hood. From the side it looks like a Kia, or a Chevy, or a Ford, or a Honda.....they have got you people in the same cars with the same look now. All alike. If I had to drive a Prius, I'd wear a mask and I would hate to see what people would look like after a head on with a pickup!

  • Report this Comment On February 22, 2014, at 11:11 AM, tearanew wrote:

    The Camaro and Challenger already have independent rear suspension and no one discusses it as a "risk". Why then is it risky for Ford to use IRS on the Mustang?

  • Report this Comment On February 22, 2014, at 11:39 AM, emailnodata wrote:

    The Hondas I've owned have had expensive mechanical issues over their lives, including transmission issues in the MDX line and some brake issues on the Accord Coupe. The Hondas are nice inside, good engines, but the weak from the engines to the rubber on the road.

    The Toyota and Lexus vehicles have been very sturdy, and the repairs minimal over the long years I've owned them.

    My personal experience, not a scientific survey.

  • Report this Comment On February 22, 2014, at 11:44 AM, jimmy5fingers wrote:

    Does Toyota Care come with a crash helmet? Banzai!!!!!!

  • Report this Comment On February 22, 2014, at 11:50 AM, SWFLORIDA1106 wrote:

    Would never buy a Honda,Toyota,Nissan,etc...

  • Report this Comment On February 22, 2014, at 11:50 AM, dan11809 wrote:

    Toyota Camry transmissions have lost quality over the last few years.

  • Report this Comment On February 22, 2014, at 11:53 AM, Freddyfreebe1 wrote:

    When they started installing timing belts in place of timing chains on there engines they create a never ending auto repair shop business. When they put the fuel pump in the gas tank, they took away your road side quick fix. A cars are not only an over priced investment these days , it have become a never ending bill to keep it running. People should not need a auto repair shop to own a new car. Most people should be able to maintain there auto without a 2nd mortgage to maintain there cars. Over price cars, over price fuel,over price insurance and now over priced auto maintenance , is why people will learn to do without them.

  • Report this Comment On February 22, 2014, at 12:30 PM, pamcopete wrote:

    The fleet and rental sales figures for Toyota are a little misleading. Many of the fleet sales are company cars driven by individuals who do not need to buy a car of their own. Rental companies routinely sell their cars in a year or two and many people wait for those sales to buy a Camry at a bargain price. In both cases, it is individuals who park the cars in their garage, just like the individual buyers.

  • Report this Comment On February 22, 2014, at 1:01 PM, normgarry wrote:

    Both cars suck.

    Soul-less econoboxes for cash-poor, unenthusiastic drivers.

  • Report this Comment On February 22, 2014, at 1:28 PM, Ondago wrote:

    I purchased a 2009 honda accord v6 and had major problems after 1 year of owning it! Honda refused it take responsibility. I sold accord at a major loss and now it's a pending class action for engine misfire that I argued with them the entire time I owned my accord about this sMe issue. Don't believe this review, google accord problems.

  • Report this Comment On February 22, 2014, at 1:38 PM, bmlw wrote:

    The people that drive the Camry must not be able to read. It has been the #1 recalled car for years but, like lemming, they follow the other owners over the cliff. The recalls are not simple fixes they are put your life in danger recalls. The latest one is the power seats that could give you smoke butt even though it's not St. Pat's Day. READ PEOPLE!!!

    Your not buying quality any longer because their concern is quantity. Let's go places like to the hospital or back to the dealer for chronic repairs.

  • Report this Comment On February 22, 2014, at 1:50 PM, btc909 wrote:

    If you get one of these get rid of the brake pads. I use Centric ceramic pads.

  • Report this Comment On February 22, 2014, at 2:46 PM, mbezard wrote:

    Looks like someone is trying to take a shot at #1. Don't think that Ford or Honda will EVER pass Camry in total sales no matter how many times or how many Articles are written on front pages about the recalls etc. Every other manufacturer has just as many recalls they are just not Front page news. They are hardly ever mentioned and if so buried on page 3.

  • Report this Comment On February 22, 2014, at 3:22 PM, Number1FordFan wrote:

    Funny how most people think of the hondas and toyotas as the gas savers but the ford Fusion hybrid gets better MPG that ANY of the Camreys and Accord models,

    odd but true.

  • Report this Comment On February 22, 2014, at 3:43 PM, geedee01 wrote:

    This article doesnt make sense to me at all. Camry is the best car right now with quiet car award and Quality is #1 compared to Ford and Honda.

  • Report this Comment On February 22, 2014, at 4:20 PM, dclaudew wrote:

    Are these really midsized cars? What is the definition in terms of cubic feet, and how many cubic feet do the Japanese cars have? It seems to me that they get bigger every year, until they now bloat. I'm long in TM and NSANY, but I don't care to drive a big car myself.

  • Report this Comment On February 22, 2014, at 4:29 PM, paramountpilot wrote:

    I have a 2003 Honda AccordV-6 Coupe and a 2007 Camry XLE V-6 The Honda has been spectacular reliability wise. The Toyota has cost me a couple thousand dollars in repairs the last couple years. I'd buy either of them again but the Honda has been all that and more.. Not even one complaint.

  • Report this Comment On February 22, 2014, at 4:30 PM, rotorhead1871 wrote:

    melba toast,,,,,,,neutralized asian cars....they are ALL the same...

  • Report this Comment On February 22, 2014, at 4:32 PM, rotorhead1871 wrote:

    asian cars are the booby em...then you are stuck with em......

  • Report this Comment On February 22, 2014, at 5:16 PM, frellmedead wrote:

    I'm done with Ford. Had a Fusion that had the alternator go out in less than a year. Lost power steering and headlights at night, with almost no warning. Honda seems to have an issue with a module or a computer issue that the brake warning light comes on. Had this happen on a brand new Pilot as we were driving it home. Dealer had to take the dash apart to replace the module, so it was in the shop for two days.

  • Report this Comment On February 22, 2014, at 6:49 PM, pwkrp wrote:

    Some people say cars all look alike, and they do. Why because they all want to get the best millage and one way is the design of the body. What happens when a car in in the wind tunnel. They all chose the style with the least resistance. So you end up with a lot of cars looking abut the same on the side.

  • Report this Comment On February 22, 2014, at 7:49 PM, susiedarling wrote:

    I have a 1996 Toyota Camry with 106K miles on it. The body is beautiful. I've hardly had to put any money into it all over the years. Runs like a charm. How many other cars can you get the same longevity without any major problems/repairs. I've met other people who own the same year Camry and they have over 200K miles and also have had very little expense. I'm going to run it until it blows up.

  • Report this Comment On February 22, 2014, at 9:53 PM, fredjohnson55343 wrote:

    Love my Honda CRV's Best small SUV made.

  • Report this Comment On February 22, 2014, at 10:47 PM, ponchoman49 wrote:

    Will never buy a Toyota again. The new 2013 bodystyle Camry I got has already had several trips to the dealer for electrical problems, suspension noises, several recalls and brake problems. The interior is already falling apart too! I just yesterday went over a sharp bump and the front HVAC vents literally popped out and fell on the floor! Compared to past Camry's this 4 cylinder SE rides much stiffer, the seats are harder and there is much more tire and wind noise. Gas mileage has never reached the indicated 35 highway as the best I have ever seen is only 32. Next time an Accord or Sonata will be in my driveway!

  • Report this Comment On February 23, 2014, at 1:06 AM, funkdoobiesun wrote:

    It's all can go on the web and find millions of articles just like this..but with the product being a tv, a toaster, or a cellphone, or even yogurt. There are way too many variables that drive reliability...before even considering recalls..and a lot of the user reviews on reliability are very biased , purely on protecting the vehicle brand they love. For instance, I know many jeep owners who will always boast how reliable and rock-solid their Jeep has been in related conversation...yet, 4 or 5 times a year they unwittingly mention "work being done" on their ride. Seems too much for me..but I don't know their driving habits, parking conditions, maintenance records,etc. Maybe they suck at routine maintenance, and don't even know it ...Too many variables!! Polarly, I know people that swear that all the foreign cars that they've had have been horrible!! All I know is that I have had 8 toyotas..put 200k or more on each ( stupid commute) and have had a solid experience with them..and the few times that I have strayed from Toyota (out of boredom for the styling,etc) ..I have had a much worse experience. Just understand that whatever vehicle you buy, whichever have to do your maintenance, even proactively..not waiting til it breaks..and even still may get a lemon car..and the common factor in all of them..they all are gonna cost you funds that you don't want to spend.

  • Report this Comment On February 23, 2014, at 1:43 AM, chrischamb1 wrote:

    MF should stop having people write columns on the car industry.....Another boring, uninformative, filled with "maybe's" "if's" and NO new information of any type. If I want to sleep I now have 2 options: 1. Take a Xanax 2. Read a MF automotive article!

  • Report this Comment On February 23, 2014, at 4:38 AM, stanhope59 wrote:

    Since this is an investment oriented site instead of an auto enthusiast site, I'm surprised the author cites only US sales figures. Global sales would seem to be more important to the bottom line and the Camry was in 6th place and the Corolla was in 2nd. No Honda car placed in the top ten.

    In addition, the author failed to mention that the Accord and Fusion mentioned favorably are newly redesigned models which often surge in sales. The Camry is well into this design's life cycle and it has a major redesign upcoming. Again, I would find this sort of info more important for an investment oriented article. As much as I love talking cars, the information included here indicates an opinion piece rather than an informative one.

  • Report this Comment On February 23, 2014, at 9:46 AM, F100XLT wrote:

    Have always loved Japanese dependable autos. Have always disliked their cheap braking systems, cheap window operating systems, cheap sound systems.

    That said, the middle-class purchasing power has diminished to such degree that the old days of likes of Taurus vs. Camry is become an non-issue. The secure economic standard of purchasing 20% of one's annual wage, puts the new middle class into $10,000 used car respectably.

  • Report this Comment On February 23, 2014, at 1:37 PM, YumaSunBum wrote:

    After working on Honda cars since 1974 I have continued to be impressed by their fit, finish, and longevity. In the earlier years there were problems like anything, but they worked their way through it and now are the bench mark of the industry. Others have caught up a little, but Honda still remains the best. Spendy, yes, worth it, yes. The Honda/Acura lines are the best all around vehicle in today's market. And no I am not a spokesman for them, I just love them.

  • Report this Comment On February 23, 2014, at 3:19 PM, jay105 wrote:

    Have a Hyundai Sonata is bigger than both Camry and Accord, cheaper, looks better and have longer warranty.....a no brainier.

  • Report this Comment On February 24, 2014, at 6:29 AM, SirKnight10 wrote:

    When Americans re-gain their loyalty and begin buying American cars where the cars are designed by American engineers, built by American workers and the profits from the sales stay in America, only then will I be happy.

  • Report this Comment On February 24, 2014, at 8:14 AM, DrG wrote:

    Had a Camry and loved its reliability but was underpowered. Looked at Camry, Honda and Altima then. Altima had great ride and pep and $2000 cheaper than Camry or Honda

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Daniel Miller

As a Motley Fool Industrial Specialist, I use my marketing and business background in the automotive industry to evaluate major automakers and other large industrial corporations. Follow me on twitter for tweets about stocks, cars, sports, and anything I find amusing.

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