Cape Town – Six years after Toyota decided to discontinue the top-selling Tazz it has finally launched a replacement.
From 1996 to 2006 Toyota South Africa sold 207 169 units of the Tazz. For eight out of the 11 years that it was on the market in South Africa the Tazz was market-leader in the sub-B segment which combines B-segment size at A-segment prices.
Unfortunately for Toyota it is this segment which has seen phenomenal growth in the last couple of years while the manufacturer was left without a model to compete for the market share.
According to Leo Kok, Senior Manager for Corporate Communication at Toyota South Africa Motors, the sub-B segment has grown at a rate of over 100% in the last year.
Toyota hopes to sell 20 000 units per year of the Etios, with a starting price for the basic hatchback model of R115 800. The sedan model will start at R121 800.
“Yes we are late,” he admitted when asked why they are only now bringing a replacement for the Tazz to the market.
“However, Toyota made a decision not to continue with the production of the old model or just to extend it. The Etios is a completely new product and then six years is actually not such a long time,” he said.
According to Calvyn Hamman, Senior Vice President Toyota SA Sales and Marketing, the Etios was conceived after very extensive market research.
“We observed every aspect of car ownership from the standpoint of the customer including general functions, performance, quality, durability, reliability and equipment. From there, we polished and enhanced the product offering and performance aspects that were truly needed, and eliminated any excessive specifications. As a result, we were able to strike the best balance between initial purchase price, running cost, performance and specification, which are all essential to a quality, affordable, “value for money” vehicle. After all, the Tazz left us with very big shoes to fill.”
The Etios that will be sold in South Africa will be imported from Toyota Kirloskar Motors, the Indian Affiliate of Toyota Motor Corporation.
Another reason why it has taken a while for the Etios to be launched is that production of this model is out of brand new production plants – the one in India and the other in Brazil.
The Indian plant supplies mainly to that country, with only 20 000 units available to be exported to South Africa initially.
Kok told Moneyweb that in July 2011 the production capacity from the Indian plant was 160 000 units per annum. It has already increased in the first half of 2012 to 210 000 – 120 000 going towards the Etios.
Early in 2013 the plant will already be up to 310 000. This is because the Etios is proving to be a great seller in India and more production is needed to meet demand.
Kok is confident that Toyota will be able to sell the 20 000 units that it will receive from India.
He says the trend where customers focus on the sub-B segment due to financial difficulty will only accelerate due to factors like possible tolls and petrol price increases.
He foresees that some of the sales in Etios models will subtract from current sales of the Yaris and Aygo, but that 80% of Etios buyers will be incremental growth that won’t be attrition from existing models.
Over the lifecycle of the Etios Toyota hopes to achieve a market share in the segment of around 28%.
The Etios will be competing with the likes of the Ford Figo and Volkswagen Polo Vivo.
Kok acknowledged that there are currently no plans to produce the Etios locally.