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Toyota predicts 1.1 million sales

On top: Toyota hopes to dethrone Ford's Territory with its new Kluger.

Toyota forecasts new-car sales to reach a record 1.1 million in Australia this year

7 Aug 2007

TOYOTA chairman emeritus and Federal Chamber of Automotive Industries (FCAI) president John Conomos believes up to 1.1 million new vehicles could be sold in Australia this year, a figure that would obliterate not only the nation’s current sales record of 988,269 set in 2005 but the FCAI’s own official forecast of 1,053,000 vehicle sales.

Unlike Mazda Australia managing director Doug Dickson, who told GoAuto just over a month ago that supply problems would prevent the industry from recording the expected million sales milestone this year, Mr Conomos believes there is both sufficient demand and stock to set new sales records in 2007.

“The million vehicle market has already become a reality in terms of the past financial year, and there is little doubt that it will be ratified in this calendar year,” he said at this week’s second-generation Kluger national media launch.

“In fact it’s possible that the figure could be closer to 1.1 million. The current estimation is that there is sufficient stock within the industry to reach that number and probably exceed it.” Mr Conomos said that despite increased vehicle running costs, interest rate rises and a looming federal election, both business and private buyers continued to flood new-car showrooms.

“The motor industry has gathered critical mass like never before and that will carry us over the line,” he said. “It is a quite incredible situation.

“Even in the face of rising petrol prices and rising registration and insurance premiums, the retail motor industry continues to flourish.

“Even with the past four interest rate rises, and the threat of another one, there does not seem to be an issue for personal vehicle buyers in the marketplace.

“Not even the uncertainty that normally surrounds federal elections at the beginning of the fourth quarter is likely to diminish the opportunity for us to go through the million vehicle market.” Mr Conomos said an influx of new models and positive economic indicators had combined to create unprecedented new-vehicle demand in Australia.

“The issue of course is the fact there’s such a widespread range, with almost a new product being launched every month.

“There is every reason therefore to be confident that vehicle sales will remain strong. Vehicle affordability has seldom been more attractive. Continuing high employment, rising incomes and increases in asset values are all contributing to the success of the market.” Mr Conomos said the new Kluger would play a pivotal role in driving both Toyota’s and Australia’s sales to new records.

Launched only four years ago, the current Kluger achieved its best monthly sales figures of around 900 vehicles soon after its release, before attracting an average figure of around 350-400 and monthly totals of around just 280 sales in its run-out phase.

To July this year, Kluger lies fifth in the medium SUV sector behind Territory (26.8%), Toyota’s own Prado (21.8%), Holden’s Captiva (14.7%) and Mitsubishi’s Pajero (11.0%), with a segment share of just 5.7 per cent.

Meantime, Ford’s medium SUV segment-leading Territory, which is also available in both 2WD and AWD guises, still finds anywhere between 1100 and 2300 buyers per month.

Embarrassed by failing to sell half of its predicted number of homegrown Avalon sedans between 2000 and 2006, Toyota Australia no longer reveals its internal sales forecasts. Privately, however, top executives say they would be “delighted” with monthly sales of 1500 for Kluger – but the eventual goal is to beat Territory.

Toyota describes the 2WD version as a “whole new model” that will account for slightly more than half of all Kluger sales, in effect doubling the model’s sales.

It believes Kluger’s all-additional 2WD sales, plus extra AWD sales and conquest sales will help it do so, and says sales to business buyers, many of whom now also use their vehicles for private purposes, will comprise half of all sales.

“To achieve our sales goals for Kluger, we expect to grow the medium SUV market,” said senior executive director sales and marketing David Buttner.

“We will achieve our sales goal by selling the new Kluger to both the fleet and private markets. The biggest single opportunity is with business customers – including the user-choosers operating novated leases or choosing salary sacrifice.

“They will account for almost half of Kluger sales – proud to drive it for work during the week as well as with the family onboard during the weekend.

“The private customer will not be far behind in terms of sales. This is truly a car for the busy family. The new 2WD Kluger models will account for around 52 per cent of sales. Every one of those sales is incremental for Kluger.

“We are also aiming to lift our annual AWD sales. To do this, we expect a degree of conquest sales as well as taking part in the general growth in the segment,” said Mr Buttner.

Toyota says it is no longer enough to regard family buyers as the exclusive residents of the so-called private market, and that the 2WD Kluger buyer is more likely to be female, to live with a partner and their kids, and to be younger and less wealthy.

“(Kluger) enables us to properly participate in a market which is clearly becoming another option for family transport. And of course that family appeal is universal,” said Mr Conomos.

“Novated leases and the increasing concept of a vehicle as a form of recompense through salary negotiation has blurred traditional market segmentation. These days even a so called family vehicle has to make good business sense.

“The arrival of 2WD in addition to AWD gives us the opportunity to expand Kluger sales significantly. Having both 2WD and AWD in our armoury means we can now tackle this segment head-on.” Toyota set new industry sales records of about 24,500 vehicles in June, more than 116,000 vehicles in the first half of 2007 and 225,000 vehicles for the previous financial year, putting it more than 47,000 sales and 7.7 percentage points ahead of Holden in terms of market share.

HiLux has dethroned Commodore as Queensland’s best-selling vehicle and, for the first time, Toyota has become the most popular brand in South Australia, Holden’s manufacturing home state.

Toyota now has an unassailable lead over Holden in the 2007 sales race and hopes to sell around 235,000 vehicles this year – making it the fourth successive year it has sold more than 200,000 vehicles.

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