Leroy said the question Toyota has to determine is whether it should develop a Europe-specific sedan and wagon like the Avensis, which is only produced at the automaker's UK plant, or offer a much more global product.
"It's very tough to be in the mid-sized segment in Europe," Leroy said.
In western Europe the volume mid-sized segment is on track to have its lowest sales this decade, dropping below a half-million units this year from more than 800,000 in 2011, according to IHS Automotive, as customers switch to premium rivals or hot-selling volume crossovers.
Said IHS principle analyst Tim Urquhart: “It’s the law of diminishing returns for the mid-market brands in terms of this segment. The very fact that Ford has delayed the launch of the Mondeo by two years shows how difficult the market is.”
Western European sales of the current Avensis, launched in 2008, will slip to 29,339 this year from 55,706 in 2010, according to IHS’ forecast. The analyst expects Toyota to end sales of the car in 2018.
Toyota made 36,482 Avensis sedans and wagon at is factory in Burnaston, England, last year compared with nearly 143,000 units of the Auris compact model line. Of those Auris models, 62,148 were hybrids, according to Toyota’s Web site.
Toyota already offers a mid-sized car with its gasoline-electric hybrid powertrain, the Toyota Camry. In the U.S. last year Toyota sold a combined 408,484 non-hybrid and hybrid versions of the Camry, making it the top-selling car in the world’s second-largest market.
Japanese makers have been hit hardest by the shrinking mid-sized sector in Europe. Nissan left the segment in 2008 when it ended sales of the Primera.
IHS forecasts that Honda will stop sales of the Japan-built Accord in 2015. The Accord will remain on sale next year, a Honda spokeswoman told Automotive News Europe in an e-mailed statement. She declined to comment on the car’s future beyond then.