Toyota NZ acknowledges vehicle supply issues

No quick fix for stock constraints, market leader warns.

the rav4 hybrid is among models that have become subject to delivery delay

WILL other brands lose reluctance to steer clear of acknowledging how affected they also are by an increasingly obvious problem – diminished new vehicle availability – now that the market’s biggest hitter has opened up about its own situation? 

That rhetorical becomes more valid with Toyota New Zealand’s concession that delivery times for popular models are slowing, to the point where orders are taking more than a month to fulfil.

The Palmerston North-based operator, which still accounts for one quarter of all new passenger vehicle sales nationally even after been hit hardest by the rental car business freeze, has stopped short in comment issued yesterday of being too specific about which model lines are being affected and for specifically how long in respect to individual types.

However, two models it has given as examples of being subject to hold-up – the RAV4 Hybrid and the new Hilux – are among its biggest stars and it has also cited that most of its popular vehicles are subject to some degree of inconvenience.

It also suggests an average wait time of six weeks between orders being lodged and fulfilled is often normal, that deliveries up to March, 2021, are impacted and there is potential for delays to continue until the middle of the year.

“The effects of Covid-19, closed borders and delayed shipping and logistics into New Zealand are severely impacting all operational areas of our business,” says chief executive officer Neeraj Lala.
 
“We have seen greater than a 30 percent reduction in our new and used vehicle sales due to the closure of the borders, and we are forecasting a minimum of 10 years impact to our overall value chain including reduced parts and service.”
 
As much as coronavirus-influenced supply chain disruptions and congested ports are the main cause of vehicle supply delays, TNZ these issues are also exacerbated by high global demand for new Toyota vehicles.

 
There is also further disruption in logistics with global shipping delays impacting new vehicles, used vehicles from Japan and parts, which has an effect on delivery schedules here.
  
Lala says the company is enormously grateful customers are showing patience but accepts that on-going delays will impact future sales as customers become frustrated.
 
“We are doing everything we can, but global demand and supply restrictions combined with shipping delays are fuelling customer frustration. We are providing customers with updates as often as we can but these timeframes are fluid.”
  
“We currently have 3,297 retail orders as at the end of November, which is a good position for Toyota New Zealand to be in but that means 72 percent of vehicles arriving in the country are pre-sold which is unprecedented for Toyota as demand for low emission hybrids continues to surge,” he says.
 

Market almost a quarter down on 2019

The new car market’s slump is becoming more pronounced.

DECLINING consumer interest, diminishing supply, a reflection of how a market looks when it isn’t being influenced by rental fleet demand? 

All have been cited by various sources within the motor industry as latest registrations data, the count for August, further supports a hefty drop in new vehicle registrations year-to-date compared to the same period last year.

“Year to date the market is down 23.8 percent, which is consistent with recent months data confirming our expectations that 2020 will finish about 25 percent down on 2019 volumes,” says David Crawford, chief executive of the Motor Industry Association, which represents new vehicle distributors.

His thought about why? Well, it all comes back to coronavirus, of course – the pandemic has slowed the vehicle industry and purchasing globally.

Specifically, Crawford ventures, it reflects a weaker economy affected by Covid-19. As for local influences? Well, the MIA hasn’t ventured that far, but others within the industry, speaking on condition of anonymity, have.

One says it’s pretty clear, now, that some brands are having trouble achieving supply of new products. Looking at more precise datasets than those shared by the MIA reveals a lot more, he suggests.

Another says the year to date decline reduces significantly when rental counts are excluded. “August can be a big month for rentals. Take them out and the decline is more like eight percent year-on-year, which isn’t so bad all things considered.”

Fair call? Well, when rentals are under the spotlight, really just one brand is affected more than any other, and that’s Toyota New Zealand. Interestingly enough, in a state of the national chat with motoring writers during last week’s MY21 Hilux event, TNZ CEO Neeraj Lala touched on the impact the collapse of the rental market had on his volume, noting that the rental count year to date in 2020 was about 90 percent down on the same period last year. 

In total, some 10,902 vehicles were registered last month, a decrease of 3623 units compared to September 2019.  

The top three plate-ups were the Ford Ranger (663 units) leading the Toyota RAV4 (464 units), and the Mitsubishi Triton (360 units).

The MIA also note a spike in electric vehicle registrations, due mainly to the Tesla Model 3; dissemination of the latest shipment of presumably pre-ordered cars accounted for 139 of the 243 fully electric vehicle registrations. Additionally, 54 plug-in hybrids and 927 hybrids – the latter mostly Toyotas - hit the road. 

Toyota was the market leader for passenger and SUV registrations with 16 percent market share (1,217 units) followed by Kia with 10 percent (801) and then Suzuki with 8 percent (625).

In the commercial sector, Ford retained the market lead with 25 percent market share (803 units) followed by Toyota with 13 percent (406) and Mitsubishi third with 11 percent (360).

August return ok, but market sliding away

No prizes for guessing the top sellers in August.

TOYOTA’S RAV4 cleaned out the opposition in new passenger vehicle sales during August, selling at more than double the rate of anything else.

And the Ford Ranger ute almost achieved the same in the commercial market, taking a massive 27 per cent market share.

But overall, new vehicle registrations in August were once again adversely affected by the Covid-19 restrictions, especially the alert level 3 in Auckland, reports the Motor Industry Association.

August registrations came in at 15.8 percent below August last year, with 10,610 new vehicles registered, which was down 1997 units on the same month in 2019.

“Year to date the market is down 23.6 percent in a year that remains heavily affected by the Covid-19 pandemic,” said MIA chief executive David Crawford.

The shining lights among the depressed level of sales were the Ranger and RAV4.

Ranger achieved 964 registrations, way ahead of the Toyota Hilux whose 524 registrations were no doubt affected by the fact the current model was in runout prior to launch of a new model this month.

The massive success of Ranger allowed Ford to retain the market lead in the commercial sector with a 30 per cent share, followed by Toyota on 19 per cent and Mitsubishi on 11 per cent.

The RAV4, with its hybrid models at the forefront, achieved 638 registrations to dominate the passenger and SUV segment – in second place was the Kia Sportage with 313 sales, followed by its smaller brother the Seltos with 243 registrations.

No surprises then that Toyota was market leader for passenger and SUV registrations with a 19 per cent share, followed by Kia on 10 per cent and Suzuki on 8 per cent.

Overall the top segments for August were once again dominated by SUVs. Top spot went to medium SUVs with a 22 per cent share, followed by 4x4 utes with 18 per cent, and then compact SUVs also with 18 per cent.

Top 15 most popular vehicles in August

Ford Ranger                  964 sales
Toyota RAV4                638
Toyota Hilux                 524
Mitsubishi Triton          376
Kia Sportage                 313
Kia Seltos                     243
Suzuki Swift                 220
Toyota C-HR                 200
Mazda BT-50                199
Mazda CX-5                  197
Toyota Corolla              194
Holden Colorado          193
Hyundai Tucson            188
Toyota Yaris                 183
Mitsubishi Outlander   159  

Stay at home, buy a car

Latest monthly registration figures have surprised the industry, but it’s not expecting this boom to last.

RAV4 was a sales star for Toyota last month.

CASHED-up Covid-19 returnees look to be contributing to a spike in national new vehicle sales – with the July count almost at record level.

Motor Industry Association data for last month suggest registrations of 12,263 new vehicles; that’s 3.1 percent and 366 units better than the count for July of 2019 and also the second-strongest July ever recorded by the MIA.

The result was also in stark contrast to June, when sales of 11,514 vehicles were recorded. That count presented as a 17.5 percent on the same month of the previous year.  Yet June was in itself way better than April and May when, in the midst of the Covid-19 lockdown, 1039 and 8313 registrations were respectively recorded.

MIA chief executive David Crawford describes the July result as surprisingly strong, given the current worldwide economic conditions.

“Returning cashed-up Kiwis and alternative spending to international travel are thought to be behind the July result,” he says.

Market leader Toyota New Zealand says no-one could have anticipated the level of sales last month, given that it is usually a cooling off period in the wake of May and June, which have traditionally been big sales months.

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“The level of new orders across our entire range has surpassed our expectations,” says chief executive Neeraj Lala, adding that TNZ’s July result was the biggest retail month since the launch of the brand’s Drive Happy business model in April of 2018.

Crawford warns however that as the year progresses the economic outlook is for a continuing tightening market.

Despite July’s good result, the tough three month during the opening half of 2020 have meant that year to date the new vehicle market is down 24.8 percent or 21,694 vehicles.

July saw 8200 passenger vehicles and SUVs registered which was 3.5 percent up on July last year, while 4063 commercial vehicle registrations were up 2.3 percent.

The top three models for the month were the Toyota RAV4 SUV, followed by two utes, the Ford Ranger and Toyota Hilux.

Toyota remained the overall market leader with an 18 percent share, followed by Ford with 10 percent and Mitsubishi with eight percent.

Toyota also led passenger and SUV sales with a 17 percent share thanks to solid sales of the RAV4, Corolla and C-HR, followed by Kia on nine percent largely due to sales of Sportage and Seltos SUVs, and Mitsubishi with eight percent, thanks to continuing good sales of ASX and Outlander.

Ford regained the market lead in the commercial vehicle sector with a 22 percent share, resting on the imprint of its top-selling Ranger ute but also good sales of Transit van. Toyota was second on 20 percent thanks to Hilux and Hiace van, while soon-to-disappear Holden was third with a 10 percent share via sales of 381 Colorado utes.

Overall the top segments in July were dominated by SUVs. Top spot went to SUV Medium with a 22 percent share, followed by SUV compact on 19 percent. The Pick Up/Chassis 4x4 segment held 16 percent share.

Last month’s top 15

Toyota RAV4                 796 sales
Ford Ranger                  781
Toyota Hilux                 627
Mitsubishi Triton          383
Holden Colorado          381
Kia Sportage                 320
Mitsubishi ASX              265
Suzuki Swift                  251
Toyota Corolla              230
Nissan Navara               229
Mazda BT-50                227
Mazda CX-5                  222
Mitsubishi Outlander    220
Hyundai Tucson            206
Kia Seltos                     184