The global car industry, like virtually every other industry in the world, is taking a hit from the ongoing pandemic. Depending on the brand and on the specific market, we have seen year-to-date sales drops of as much as 50% compared to the same period last year.
Which makes it impressive that Toyota is fighting back to the tune of losing just 16% of its sales numbers from last year. Under normal business circumstances, a 16% drop would be alarming in any business; but given the onslaught of this relentless virus, achieving 84% of last year’s sales is a win in itself.
How did Toyota do it? Surprisingly, with a model that hardly made a dent (pardon the pun) in Philippine sales — the Toyota RAV 4. Toyota’s evergreen crossover logged in 426,000 units sold in Japan and other export markets in the first half — a record high among Toyota models. Sales were good in shape especially in two countries: the key markets of North America and China, selling approximately 72,000 RAV 4s — an increase by 15% over last year.
The world’s biggest automotive market, China, helped a lot too. Total Toyota sales in China were up year-on-year for three consecutive months, while sales in Europe (despite being down 11.5%) have been recovering since May. China sales were down in the first half of the year due to effects from the spread of COVID-19, but dealers resumed operations at the end of March, online events were used to attract customers, and sales of the new models were strong, resulting in sales at the previous year’s level.
In Japan, sales have been trending toward recovery to 77.3% since June in conjunction with the cancellation of the Japanese government’s state of emergency declaration, which lasted from April 7 to May 31. In the April to June quarter, sales were down 31%, recovering at a pace that exceeded initial expectations in May.
Demand in Japan declined due to lingering effects from the consumption tax hike in January and February followed by stay-at-home requests and falling consumer sentiment starting in March in response to the COVID-19 outbreak. Sales of 710,589 units from January to June were down 14.5% year-on-year, but domestic sales of new models including the Raize, Yaris, and RAV 4 were strong, with sales trending toward recovery.
Sales in other Asian countries were down compared to the previous year due to effects from the suspension of dealer operations in response to COVID-19 and slumping economies in some countries. Total Asia sales (excluding Japan) of 1,156,404 units (more than 70 percent of which came from China) for the period were down just 19.4 percent, buoyed by China sales.
Sales in North America were strong, particularly sales of light trucks including the RAV 4 and Highlander, until mid-March, but subsequently fell from the previous year’s level due to effects of COVID-19. Sales of 1,018,178 units from January to June were down 23.9 percent from the previous year, but have been recovering as demand from individual customers has returned since May.
In Europe, despite strong sales early in the year, mainly of the RAV 4, Corolla and UX (all HEVs included), lockdowns have been implemented in many regions in response to effects from the spread of COVID-19, and sales activities were suspended, causing sales to decline in April. Although sales of 409,893 units from January to June were down 26.2 percent from the previous year, dealer operations in each country resumed starting in May, and sales in Europe are recovering.
Lexus pulled strongly as well. Global sales of the luxury brand in June amounted to approximately 64,000 units, reaching a record high in June. China, in particular, exerted a great pull, selling approximately 22,000 units that covered approximately 34% of the total sales. At that rate, one out of every three Lexus models sold worldwide goes to China.
Aside from sales, global production figures for the Japanese giant were equally promising. In June, global Toyota production recovered to 76% of the previous year’s level (production was down 50.8% in April and down a whopping 54.4% in May). The main drivers were China (April: up 27.8%; May: up 13.5%; June: up 21.6%), North America (April: no production; May: down a stunning 78.5%; June: down by only 8.4%), and Europe (April: down a huge 99.2%; May: down 59.9%; June: down by just 3.9%).
In the Philippines, Toyota has been the leading brand for over three decades, with most of its models dominating sales in their respective segments. The Vios subcompact sedan has been the bestselling car in the country, with the Fortuner midsize SUV another perennial leader. Consumer demand has been continuously stimulated with recent launches of the facelifted Wigo, a new cargo variant of the Hiace van, and the upcoming debut of the much-anticipated Corolla Cross, which should do for the still-growing local market what the high-scoring RAV 4 is achieving in more mature markets abroad.
