Toyota Grand Highlander expands the line of hybrid crossovers

CHICAGO – Toyota Motor is expanding its segment-leading three-row crossover lineup with the all-new 2024 Grand Highlander, which includes two gasoline hybrid offerings.

The automaker revealed the vehicle as a bigger sibling to the Toyota Highlander mid-size SUV/crossover on Wednesday night. It’s longer and wider than the Highlander and provides 13.2 cubic feet of additional cargo volume, according to Toyota.

The vehicle is the latest example of automakers trying to increase and test their pricing power as consumers spend record amounts on new vehicles. The average price paid for a new vehicle to start this year was nearly $50,000 as automakers prioritize high-end models over entry-level models amid ongoing supply chain issues, still that improve

Toyota did not announce pricing for the Grand Highlander, but analysts expect it to be above comparable regular models that start between $36,000 and $51,000. It will be offered in three trim levels when it hits dealerships this summer.

The average price paid for the current Highlander was more than $46,600 ($48,801 for the hybrid) during the fourth quarter of last year, according to Edmunds.

The Grand Highlander joins the growing three-row midsize crossover segment in the U.S., which has expanded from 12 nameplates in 2018 to 16 vehicles by 2023, including the Grand Highlander, Edmunds reports. Other recent additions include the Jeep Grand Cherokee L, the Hyundai Palisade and the Kia Telluride.

The Grand Highlander will compete against these vehicles, as well as the Ford Explorer, Chevrolet Traverse and other more popular midsize SUVs/crossovers. These vehicles have become increasingly popular, with sales down 4% between 2018 and 2022, as Americans move away from large sedans and other vehicles.

Ivan Drury, chief information officer at Edmunds, said consumers are increasingly looking to three-row crossovers as alternatives to minivans, which are ergonomic but have faced the stigma of being uncool.

“Everybody wants a minivan, but nobody wants to admit it,” he said. “People want third rows even if they don’t use them.”

The Grand Highlander was revealed at this week’s Chicago Auto Show. Several car brands such as Jeep and Volkswagen are expected to unveil special models that are likely to push up prices.

The Grand Highlander, while larger than the standard Highlander, will be smaller than Toyota’s Sequoia SUV, which is produced using a truck-based, or body-on-frame, process. This assembly offers greater utility but less on-road comfort than a “unibody” process used for cars and crossovers like the Highlander models.

“The current Highlander is a bit smaller than the Palisade or the Traverse,” said Stephanie Brinley, principal automotive analyst at S&P Global Mobility. “You’ve got room for it. It’s not as ‘trucky’ as the Sequoia either.”

The Highlander was one of Toyota’s best-selling vehicles last year, with nearly 223,000 vehicles sold. It only outsold the small Toyota RAV4 crossover and the Camry sedan. Brinley doesn’t expect the Grand Highlander to be a high-volume product, but said it “rounds out” Toyota’s crossover lineup and gives customers more options.

Edmunds reports that the Highlander was the best-selling three-row midsize crossover/SUV in the US last year, beating out the Ford Explorer, Grand Cherokee L and Toyota 4Runner. It’s also one of the most purchased vehicles among consumers in the segment, according to Edmunds.

Toyota says the Grand Highlander will offer a suite of active safety and convenience features, as well as 13 cup holders and seven USB-C charging ports in all three rows of the vehicle.

The SUV will be offered with three different engines, including two hybrids, setting it apart from many of its main competitors. The entry-level turbocharged four-cylinder gasoline engine and V6 hybrid are currently available in the Highlander. The range-topping V6 Hybrid MAX will produce 362 horsepower and 400 pound-feet of torque, Toyota said.

The hybrid Grand Highlanders follow Toyota’s global strategy of offering a mix of traditional gas engines, hybrids and all-electric vehicles as it moves towards carbon neutrality by 2050.

“This three-row model takes the Highlander legacy into a whole new space, while delivering on our promise to deliver on electrification,” Lisa Materazzo, Toyota’s group vice president of marketing, said in a statement.

Toyota’s U.S. vehicle lineup includes 10 hybrids, two plug-in hybrid electric vehicles, and the all-electric bZ4X and fuel cell Mirai.

The Japanese automaker has been criticized by some investors and environmental groups for not moving to all-electric vehicles sooner. The company has argued that not all consumers will switch to electric vehicles at the same time and that it can produce dozens of hybrids with the same amount of carbon emissions as an all-electric vehicle.

Toyota plans to invest approximately $70 billion in electrified vehicles, including $35 billion in all-electric battery technologies, over nine years. It plans to offer around 70 electrified models worldwide by 2025.

Toyota, the world’s largest carmaker, plans to sell about 3.5 million all-electric vehicles by 2030, which would be just a third of its current annual sales.