Toyota Yaris shines in Pakistan after failing to gain traction in IndiaBusiness
KARACHI: While Toyota India has recently announced the move to discontinue Toyota Yaris, the same car in Pakistan has been shining since its launch in May 2020.
In India, Yaris was launched in 2018 to compete with Honda City, Maruti Suzuki Ciaz and Hyundai Verna.
In Pakistan, the launch of Toyota Yaris initially hit the sales of in-house product Toyota Corolla which was later revived from the start of 2021-22 as changes in design lured buyers back.
Before rolling out Yaris from the assembly line, Toyota had phased out models like Etios and Corolla Altis in India due to muted demand.
In contrast, Toyota Yaris sales in Pakistan during July-August 2021-22 rose by 32pc to 4,725 units from 3,588 units in the same period last year. From May 2020 to June 2021, total Yaris sales stood at 29,622 units.
Another reason of tremendous boost in Yaris sales was discontinuation of highly popular Corolla XLI and GLI models in early 2020. As a result, Yaris, arriving in May 2020, emerged as a successor of Corolla XLI and GLI 1,300cc.
Toyota Corolla sales after dipping 17 per cent to 18,355 units in FY21 from 22,140 units in FY20, recovered 78pc to 4,262 units in July-August 2021-22 from 2,495 units in July-August 2020-21.
The country’s auto sector, especially cars and SUVs, has been showing positive growth owing to low interest rates and improved economic indicators.
A senior executive of Indus Motor Company (IMC) did not offer any comment as to why Yaris has proved to be a success in Pakistan in contrast to failure in India.
According to a report of Insight Securities, as per Toyota India, “This move is a part of Toyota’s product strategy to continue to cater to the ever-evolving needs of the customer through enhanced technologies and product offerings.”
“We would like to continue to serve such customers with other current offerings, and preparations are underway to launch new Toyota models in the coming new year 2022.”
The report said in Pakistan, Yaris has become the highest selling sedan, surpassing its arch-rival Honda City and winning the Consumer Choice Award in 2021. However, it failed to make a mark and paled in the Indian market against rivals such as Maruti Suzuki Ciaz, Honda City and Hyundai Verna.
Toyota has a market share of 31pc in Pakistan versus 4pc in India. Toyota Pakistan has sold 15,400 units of Yaris in 2HFY21 and in India, they only sold 2,230 units due to high competition, pricing strategy and steady decline in the C-segment (small sedan or family cars) in the Indian market.
India’s automobile market is the fifth largest in the world, having 4.77 million units combined sold in passenger and commercial vehicles category. India has more than 16 automobile manufacturers, which always keeps the competition intense with the result that many players have left the market (ie Daewoo, Fiat, Porsche, GM, Ford). Moreover, in line with the global trend, India has seen a surging demand for SUVs and hatchbacks in India, which leads to market share of 38pc and 39pc respectively, the report said.
Pakistan’s automobile is an emerging market which had only three major auto assemblers previously. Indus Motor Company (IMC), the assembler of Toyota vehicles, has a recognizable share in the market (mainly in rural areas) on the back of strong consumer base and brand loyalty. However, competition has increased because of new Chinese and Korean manufacturers which change the dynamics of the sector.
The report said Pakistan automobile market has also started to move towards the SUV segment (current market share tends to 10-12pc). Therefore, new players are making an effort to introduce new products or strengthen their SUV portfolio, evident by recently launched SUVs (Sportage, Hyundai Tucson, MG HS, Kia Sorento, Toyota rush, Proton x70). The report said this SUV trend would take some time to cannibalise sedan market size in Pakistan.
Published in Dawn, October 8th, 2021