The days of low-cost Toyotas are gone forever

Toyota’s Australian office says it has no interest in competing at the budget end of the market, with its all-hybrid passenger car strategy meaning it would take an economic miracle for the Yaris – once a darling of budget-oriented new car buyers – to dip back under its current $28,990 starting price.

Back in late 2019, the Toyota Yaris retailed for between $15,390 and $22,670 – now the range stretches from $28,990 through to $34,590 (excluding the hot GR).

Granted, in that time two major things happened: the fourth-generation Yaris arrived with more equipment as standard, and the default powertrain changed from a cheap-to-manufacture 1.3-litre petrol to a complex and fuel-efficient 1.5-litre petrol-electric hybrid.

Both of those things added cost, and both pushed the recommended retail price (RRP) up. Exchange rates shifted, and the cost of inputs like steel and electronic components have marched north too.

But when asked whether there was any desire to re-introduce more affordable Yaris variants back into the range, the response from Toyota Australia’s sales and marketing boss, Sean Hanley, was quick and to the point: “No, not at all”.

Instead, the brand is continuing with its plan to make certified used vehicles the true budget-oriented option for Toyota shoppers.

“What we are doing is working hard on our Toyota Certified Pre-Owned strategy,” Hanley said.

“We typically see that $20,000 to $28,000 mark being ‘TCPO’ – Toyota Certified Pre-Owned – where we put certain warranties and certain conditions on quality with our dealers, and that’s where we see the entry point of Toyota.”

He also said there were no plans to reintroduce affordable compact specialist Daihatsu.

Back in late 2019, there were 52 model variants available in Australia with retail prices under $20,000. Now there is just one – the Kia Picanto Sport manual at $18,690 plus on-roads.

Profit margins are incredibly tight for small, cheap cars, and so it’s no surprise that the strategy of most carmakers is to simply not play in that space.

Even MG has left the sub-$20K bracket.

Although Toyota isn’t making any moves to bring its price of entry down, prices have been retreating in other parts of the new-car market as carmakers finesse their product plans in the wake of the pandemic era.

EVs have been the most notable category to see prices retreat downward, with Chinese brands racing each other to see who can offer the sharpest-priced EV while other automakers, like Jeep and Ford, are cleaving thousands from the RRPs of under-performing BEV offerings in an effort to bolster sales and clear stock.

It’s not just EVs, either. In July, Nissan cut between $1000 and $3000 from the RRPs of its entire X-Trail range, with hybrid e-Power variants now wearing pricetags lower than when they launched.

However, Nissan has been steadily losing market share and needs to make moves to stay competitive. The opposite is true of Toyota right now.

Join the conversation at our Facebook page
Or email us at editor@carsales.com.au