Toyota set to go local on hybrid parts

TOYOTA Australia has signalled its long-term confidence in the Camry Hybrid by planning to source as much as half of the hybrid drivetrain for the second-generation model from local suppliers.

Currently, the whole Hybrid Synergy Drive system, including the four-cylinder engine, is imported for installation into the locally-made body at the Altona plant.

In an exclusive interview, Toyota Australia president and chief executive officer Max Yasuda told GoAuto that replacing imported parts was a high priority for the company.

“We want to localise the car as much as possible,” he said.

“We have to do that to avoid the fluctuations of the currency as much as possible. Currency can affect the costs very much.” Mr Yasuda was speaking at a ceremony to recognise the nomination of the first Toyota dealership to achieve Five- Star Toyota Environmental Dealer status.

The dealership, Patterson Cheney Toyota in Dandenong, Victoria, has cut energy use by 15 per cent, saves 70,000 litres of water a year with rainwater tanks and has slashed its waste disposal costs by 40 per cent.

Left: Toyota Australia president and CEO Max Yasuda.

Mr Yasuda said Toyota Australia had not yet finalised sourcing arrangements for the next model, which is expected to be launched late in 2012, some time after the petrol-only Camry goes on sale.

“We are still making decisions about which parts can be sourced locally for the hybrid drivetrain,” he said.

When asked what level of local content would be achieved, he said “50 per cent is a good number”.

The current hybrid drivetrain import arrangements reflect the rushed timetable that Toyota Australia had to work under to bring the hybrid to production to Australia.

It was only the last-minute intervention of the Australian government, in the form of a $35 million clean-car industry grant, that persuaded Toyota head office to introduce the Camry hybrid to Altona.

Previously, Toyota had planned to make all its Camry hybrids for south-east Asia at its Thai plant.

The decision to localise the drivetrain also suggests Toyota Australia is more optimistic about the second-generation model.

At the initial line-off ceremony for the Camry Hybrid earlier this year, senior executive sales and marketing Dave Buttner said localisation would be considered if the company thought it could sell “35,000 to 40,000” Camry hybrids.

The production rate for the first model was set at just 10,000 a year, although it has yet to reach that level due, in part, to the reticence of retail buyers.

A Toyota spokesman said yesterday the hybrid model was taking around 35 per cent of all Camry sales , which means there were about 730 hybrids sold in July, in a total of 2100 Camrys. That would equate to about 9000 Camry hybrids a year.

Camry sales were up 22 per cent in July versus the same month last year and were up 33 per cent for the first seven months of 2010, suggesting that the hybrid has added to Camry sales.

However, sales of the six cylinder Aurion model were down 11.5 per cent to 7072 for the seven months, which could indicate the hybrid may be cannabalising the Aurion.