Toyota seeks to vary line-up amid Corolla’s decline
Toyota SA wants to add another vehicle to its local production line-up to absorb spare capacity created by diminishing demand for its Corolla car range.
CEO Andrew Kirby said: “We are investigating another vehicle to make use of the capacity no longer used by Corolla.”
He would not identify candidates and did not say whether Toyota SA would continue to build Corollas indefinitely.
Toyota’s Prospecton assembly plant in Durban has annual capacity to build 84,000 Corollas. In 2016, it assembled only 17,728. That number includes the latest Corolla and the Quest, a cheaper version based on the previous-generation Corolla.
Once the dominant product at Prospecton, Corolla is now a junior partner to the Hilux bakkie and its Fortuner sport utility sibling. In 2016, Toyota built 93,063 Hiluxes and Fortuners, from capacity of 120,000.
Prospecton also builds the Quantum taxi and Hino trucks. Not only is Hilux SA’s bestselling vehicle — a title once held by Corolla — but it also dominates Toyota’s exports. In the last six months, Toyota has exported 19,036 Hiluxes and 568 Corollas. Add Fortuner and the second number rises to 20,076.
It is the same imbalance in the local market. Over the same period, Toyota sold 24,398 Hiluxes and Fortuners, against 8,462 Corollas. That Corolla number includes the up-to-date Corolla, Quest and Auris, an imported relative.
Kirby said domestic sales had been hurt by a buyer shift away from the mid-market segment in which the Corolla sits.
New-vehicle sales have been in decline since 2014 and straitened economic circumstances have pushed buyers towards entry-level cars, where the main Toyota beneficiary has been the cheaper Etios, which is imported from India.
Kirby said he expected fullyear 2017 sales of all vehicles including trucks and buses, to improve marginally over 2016 — 552,000 against 547,545 — but 2018 would be another “flat” year. Exports would also be challenging. Kirby said the collapse of new-vehicle sales across Africa would continue to hamper Toyota SA, as it has all motor companies in SA.
Of the 43 African countries to which Toyota SA exports, many have been hurt by collapsed oil and commodities prices. Many of the continent’s vehicle markets were dominated by used imports, but as governments began to clamp down on this mostly unofficial trade, Kirby said, Africa would finally start to show its true potential.