RHD Toyota Kluger was no certainty

TOYOTA’S decision to switch Kluger production to the United States for the new-generation model gave the company’s Australian arm a few tense moments.

This is because, despite being one of Australia’s top-selling family SUVs and a mainstay of its local range for more than a decade, there was some chance the new third-generation version due in Australia in mid-March wouldn’t come here at all.

With Japan dropping the model from its arsenal, Australia and New Zealand became the only right-hand drive countries in the world to request the vehicle.

The vast majority of Klugers (or Highlanders as they are known overseas) are sold in the US and Russia.

This meant that Toyota Australia had to explain to its parent company why it should spend money tooling up its plant in Princeton, Indiana, to produce RHD cars for what amounted on a global scale to a drop in the ocean.

Toyota Australia on average sells around 1000 Klugers per month. It is regularly the top-selling ‘soft’ roader in the hot-selling large SUV segment behind its Prado stablemate, but in 2013 fell behind the rugged Jeep Grand Cherokee, as well as the Holden Captiva 7 and Ford Territory.

“We had to be very reasonable and realistic,” said Toyota Australia product public relations manager Steve Coughlan, adding that the company had not taken on increased volume targets to help amortise the cost of its parent tooling up for RHD.

“We looked at past running rates and the segment (trends), and it wasn’t just volume based, the argument we put forward was out of respect for Australian customers, we raised our hand to say this was a critical model for us, and something we very much wanted to continue.

“It was like every model, you have to put together a volume case if there’s a change in production… and so it was a case of us having to put together a robust argument on the case that we wanted it, but it was done so with a reciprocal understanding from our parent company of the car’s importance to us.

“They just wanted some additional information to assure them that we could continue to do the volumes that we’d done, and to assure them that the Kluger buyer’s needs could not be filled by another model.

“… when you move across to a major market and produce it in such enormous volumes in LHD configuration, our volume in relative terms is pretty humble, so it requires us to put forward a case.”

The Princeton plant, now the sole supplier of Klugers apart from a factory in China that produces exclusively for its domestic market, received a big upgrade to handle the new production.

Apart from adapting to the slightly different assembly and mirror-image dashboard layout of RHD Klugers, test and engineering alterations were also made, including dynamic simulations and to the proving ground.

The Princeton upgrade required a total $US400 million ($A454m) investment including supplier tooling, with the plant itself requiring $US131m and the creation of 400 jobs.

At last count, the plant will produce an additional 50,000 units per year, taking the total to around 160,000, with both export and an anticipated boost in North American demand accounting for the increase.

The new-generation Kluger will launch in Australia in the second week of March, and is longer and more spacious than before, has a much-improved cabin with more technology, and gets a new six-speed transmission and clever all-wheel-drive system on upper-spec variants.

The car remains a V6 petrol-only proposition in a diesel-dominated market, however, with no oil-burning option. The US market petrol-electric hybrid is deemed too expensive to bring Down Under, with those variants projected to command a circa-$6000 premium.

GoAuto is currently on the global launch of the Kluger/Highlander in California. Watch out for drive impressions over the coming days...