Commodore today, Camry tomorrow? Toyota NZ is investigating if it can join the thin blue line.

PROVISIONING police with a patrol car remains a Toyota New Zealand consideration, particularly in the wake of the collapse of rental car business.

The Palmerston North brand has acknowledged it is on the hunt to snare lucrative Government fleet opportunities including the biggest plum of all – delivering a replacement for the Holden Commodore police car, whose days on the beat are numbered with its production having ended and its maker soon to become extinct.

It is understood police are now trialling potential replacement cars for frontline duty and that they have renewed interest in the Camry sedan, thought to have been the runner-up to ZB Commodore when the tender was last contested, four years ago.

One example configured by the brand for front-line duty as part of the trial still appears to be operational in the Wellington area.

The Camry as tested by the thin blue line previously was a potent six-cylinder but perhaps the determination to use only four-cylinder ZBs is a sign police tastes have changed. TNZ’s certainly have. The distributor signalled some months ago that the V6 won’t feature in an update Camry arriving early next year.

However, it believes its 2.5-litre full petrol four-cylinder engine – which TNZ now suggests might yet provision in the update range, should perceived demand warrant it -and the hybrid would be just as good.

Do police agree? A reluctance to employ anything other than fully fossil-fuelled cars in the line of duty was expressed in the wake of last December’s announcement about Commodore production ending, when a spokesperson said that while they wanted to use as many hybrid and even fully electric cars as they could, it would only be in non-patrol roles.

TNZ chief executive Neeraj Lala isn’t sure that attitude still applies.

“My understanding of that is a little bit different. They have specifications, like a 0-100kmh specification, that they would need for a pursuit car, but currently we have a hybrid that would meet that. 

“The 2.5 also meets the standards they expect of pursuit cars.” Lala acknowledged the wholly petrol engine was initially not expected to be provisioned in the 2021 Camry update but could yet show if there was enough support for it, if just to meet all-of-Government contract requirements. “When we talked about being hybrid-only for Camry from next year it was before we knew about the Holden situation.”

In any event, it wasn’t just about get up and go. There was a host of criteria to meet, including technical standards to ensure nothing in the applicant vehicle conflicted with police equipment, especially the frequencies electronic law enforcement hardware operated at.

“As infotainment gets more complicated, as powertrains become more complicated with sensors, radars, safety equipment, hybrid and EV batteries … testing and compliance tends to become more structured and rigid. And there have been issues in the past,” he said.

He believes one area Toyota has a lead on is with backup; the national sales network was fully up to pace on  keeping any fleet operational with excellent parts, service and support. 

Police are also building up their fleet of unmarked cars and Toyota has recently provisioned some Highlander SUVs, also currently V6 and set to revert to a hybrid-only format with a new 2021 model. It also provision Land Cruisers for specialist work and some hybrid cars for community constable work.

Lala explained that was not a signal of any favouritism in respect to the patrol car pitch.

“It’s been made clear that it’s certainly not a confirmation that Toyota has won the tender but we certainly have some cars in their fleet and we are working hard to see if Camry can be an alternative.

“I’ve been quite firm that I think the relationship needs to be mutual for us to engage. It’s certainly not something that we are chasing hard, but it certainly something that we would appreciate if it came towards our brand.”

Holden’s contract with police goes back many years – it started with the Kingswood in 1968, but really cemented with Commodore, with VT, VX, VZ, VE and VF lines siting as generic road vehicles of choice, outlasting the Ford Falcon and Nissan Maxima.

Terms of the association are never discussed but the fleet size alone suggest it will be lucrative.

Certainly, it was so highly prized by Holden that police were allowed to trial the ZB in Australia in secrecy more than a year before it became production ready. The current contract was also signed off well ahead of the car’s public release here, in May of 2018.

The car proved controversial – with complaint about the lack of headroom in the rear of the sedan causing a shift to the station wagon edition – yet announcement of Commodore’s demise was a shock to police.

It clearly still held hope of seeing through the latest contract with Holden, which conceivably ran to around 2023, according to past brand acknowledgements, by taking other products in the brand’s portfolio, including the Acadia and Equinox SUVs and Colorado ute. However, that’s now no longer a goer with GM having killed Holden completely, with the retail arm set to cease very soon.

Holden had formed a really strong marriage that in any other circumstance would have been hard to break up, TNZ’s boss suggests.

“We’ve been pitching to police for as long as I’ve been with the company; we’ve put our best foot forward and been unsuccessful because they have had a really good relationship with Holden and they clearly felt no need to move.

“For us in the past it has been about good due diligence – just making sure they were testing other products in the market for when, and if, a change was needed.

“Obviously all this has moved up a gear given Holden’s departure.”

Discussion about this arose from TNZ revealing how hard it has been hit by the virtual wholesale collapse of the rental car sector as result of the coronavirus lockdown kyboshing international tourism.

A sector that took 9619 new Toyotas and accounted for 31 percent of the Palmerston North-domiciled make’s sales last year has this year taken 172 cars for a two percent slice of sales to date.

TNZ’s response has been to divert energy into building up sales to the private sector and to fleet operators, primarily the Government, with positive result. It says it has just won a tender to provision a significant count of vehicles, mainly hybrids, to the Ministries of Justice and Education.

It’s also pumping up private sales, with particular success with the RAV4 hybrid. Fleet sales, either facilitated directly through TNZ or via its dealer network, including those to Government have collectively grown from delivering 41 percent of registrations to 63 percent.

Of course, while the percentages are up, actual sales counts are down. For instance, while private sales now represent a 35 percent share of current trading – so almost double the 2019 imprint – the counts are much lower; 235 units to date in 2020 against 6001 for all of 2019. As of end of June, fleet and Government have accounted for roughly a quarter of the just over 16,000 Toyotas they secured for all of last year.

How will the rest of the year pan out? Notwithstanding that last month was huge for new car sellers and the Japanese giant had the top-selling car (RAV4), retained comfortably as the passenger sector leader and enjoyed the biggest monthly retail count (1755 units) since the launch of the new Drive Happy business model in April of 2018, its long-term forecast is cautious.

The entire market is down almost 25 percent year-on-year and industry perception that today’s rush is being fuelled by a short-range fuel – people are spending money on cars that they had set aside for overseas travel that cannot be taken – seems to be accepted by the leader, which believes a rocky road is ahead.

Even though TNZ has identified that the loss of the rental car market and a subsequent significant de-fleeting of stock by some operators had synched with a considerable market shift in used car tastes, away from ex-overseas used (which are in short supply) to low-mileage, late model NZ-new, Lala says it’s fair to say this is “experiencing changes like we’ve never seen before.”

An industry that had recorded a decade of quite considerable growth, reaching peak of just over 161,000 units in 2018 before softening slightly last year, was now facing a further 35 percent decline.

Or worse? Lala is confident Toyota is on target in predicting 100,000 registrations this year, even though others have suggested lower returns.

“Some of our competitors are suggesting a reduction more dramatic than 100,000 but I personally cannot see that happening … even if the wheels completely fall off in the fourth quarter, I can’t see the market fall below 95,000, maybe 90,000 as an absolute worst case scenario.”

When and if the rental car market would re-open was a question without any quick resolution, he suggested, and obviously TNZ, as the dominant supplier, was hard hit.

“When you remove 30 percent of our sales overnight … well, it’s never easy losing that volume.

“The pain of that tourism loss in the lockdown has certainly transferred throughout our entire business. It’s probably safe to say that this volume will not return … while the borders remain closed.”

As for the long-term forecast for car distributors? “We are, I think, heading toward a tough time – whether that’s late in the fourth quarter or early first quarter (of 2021) we have to wait and see - but at this stage we will go as hard and as strong as we can.”