Toyota's counter attack!

TOYOTA Australia is planning to source a budget car from a country with low manufacturing costs to directly compete with GM Holden’s $12,990 Daewoo-built Barina and other Korean rivals.

GoAuto can reveal that Toyota is currently investigating a future light car for sale in Australia from an emerging Asian powerhouse such as China, India or Thailand.

This car will slot underneath Toyota’s entry-level car, the Japanese-built Yaris, which is the new name for its second-generation – and market-leading – Echo light car due for release next month.

Toyota Australia executive chairman John Conomos admitted to GoAuto in Sydney last week that the only way to effectively combat price-driven competition like Kia, Hyundai and now Holden was to also source product from countries with lower manufacturing costs.

"What we have to do to compete with the Koreans is probably to produce cars outside of Japan," Mr Conomos said. "That’s one way of addressing that problem.

"It’s not in the foreseeable future – but it is something we’re considering as the emerging markets produce cars of world quality out of new facilities. That’s the opportunity for us in the future."He said China was not an automatic choice for such a venture.

"China is one area but keep in mind we have India and South-east Asia, so we have a number of choices available," he said.

To be priced from around $15,000, the Yaris will not be able compete on price against the $12,990 Barina (which goes on sale December 1) in the price-sensitive segment, although Mr Conomos indicated that pricing would still be competitive.

Holden has held on to the Barina nameplate, but switched from a car built by Opel in Europe to a version of the Daewoo Kalos previously sold here and built by GM Daewoo in South Korea.

Hyundai also launched it facelifted Getz light car last week, priced from $13,490.



One car that could be under consideration by Toyota is the 1.5-litre Vios built in China and Thailand. Another less likely possibility is the Aygo, a Czech-built 1.0-litre four-seater hatch Toyota co-developed with Peugeot/Citroen. For the time being, this is a Europe-only entity.

Mr Conomos said rebadged Daihatsus such as the Sirion (sold in Japan as the Toyota Passo) were considered, but ruled out.

"There is no plan to do that," he said. "We’ve withdrawn the Daihatsu franchise for the simple reason that the cost of production in Japan for Japanese cars is simply too high to compete against retail prices in this country.

"We’ve looked at the possibility of Daihatsu products but the costs of producing them in Japan doesn’t change, of course, so there’s no possibility in the short term in doing that."