Buyers play percentages
Cheap money is helping to push up sales, writes Neil Dowling
LOW-INTEREST finance is leading the charge in attracting buyers, says Toyota. It also points to the future of how Australians will pay for, but may never own, a new car.
Toyota Australia boss Dave Buttner says all the tricks of the car salesman’s trade are being pulled out in the fight to retain market dominance.
He says the 2.9 per cent finance deal for Yaris and Corolla — which started on November 1 and ends on January 31 — was ‘‘working well’’.
National year-to-date sales figures to the end of October show Toyota is up 8.1 per cent overall but there has been a 0.2 per cent fall in Corolla sales.
‘‘Our dealers tell us that since November 1 the inquiry rate and the conversion rate — that is, to sales — are above our targets,’’ he says.
‘‘The light and small cars are clearly the growth segment and we have to ensure we are in the prime position.
‘‘Currently we’re between models. We are not in the fortunate position of, say, 2007 when we had seven new models in the one year.
‘‘Every new model means a 2-5 per cent increase in market share. It’s very important.
‘‘But this year we don’t have that luxury.’’
So Toyota Australia, which is the only local carmaker with its own finance arm, is cross-selling products from the showroom and the cash register. ‘‘It is an extension of our capped-price servicing and is aimed at making cars more affordable to owners,’’ he says.
‘‘It is fully funded by Toyota Australia,’’ says Mr Buttner in answer to questions about factory subsidies. ‘‘We’re doing this by ourselves.’’
‘‘But it’s not a cheap exercise. It costs us a lot of money to do this three-month program so it has to be profitable.’’
Buttner expects the low-finance offers on Yaris and Corolla to be extended to other Toyota models, perhaps Camry and Aurion, after January.
Toyota’s 2.9 per cent finance, which is over 48 months and carries a 40 per cent balloon payment at the end, also hints at a future when buyers will never own their cars.
Buttner indicates that paying for a new car for a set period under a plan, similar to a mobile phone plan, was a likely scenario.
A new-car finance plan may be closer than we think because it forms the basis for ‘‘ owning’’ BMW’s MegaCity electric city car, due in early 2013.
Working well: the Yaris (above) is benefiting from a low-interest deal.