Toyota expectsYaris ATIV to cannibalize Yaris hatchback, Vios sedan sales.

BANGKOK – Toyota launches a significant model in its quest to shore up its Thailand market share with the new Yaris ATIV, its first offering in the country’s Eco-sedan segment.

With class-leading features and competitive pricing, Toyota Thailand President Michinobu Sugata describes it as a game-changer in the B-segment.

The Yaris ATIV sedan joins the Yaris hatchback as it doubles up its Eco Car portfolio. It also comes as part of the country’s Eco Car 1 program, with Sugata saying, “for Eco Car 2 we are still considering models.”

Sedans are a fast-growing addition to Thailand’s Eco segment, which initially was the domain of hatchback cars. Toyota is playing catch-up, as rivals including Honda, Nissan, Mitsubishi and Suzuki already have Eco sedans on sale.

The Yaris was introduced into Thailand in 2006, but the current version that arrived in 2013 slotted into the Eco-car program and boosted sales. The car, which comes with a 1.2L engine, has notched more than 150,000 deliveries in nearly four years to become the B-segment’s clear leader.

The new Yaris ATIV is a strategically important car that Toyota expects not only to improve its own market share but also lift the entire Eco-sedan segment to new heights.

“We will see further growth,” Vudhigorn Suriyachantananont, executive vice president- Toyota Thailand, says at the launch. In 2010, he says, “Eco-cars only had 5% of the market. That’s increased to 15%…this year the Eco-car market will grow from 15% to 20%, (and) we think it can reach 25% of the market in the next one to two years.”

Thailand’s current Eco-car standards allow gasoline engines no larger than 1.3L and diesel engines of 1.5L, fuel economy of at least 54.7 mpg (4.3 L/100 km) and carbon-dioxide emissions below 100 g/km.

The Yaris ATIV is based on the architecture of the popular Vios sedan, but it substitutes that model’s 1.5L engine with a 1.2L unit drawn from the Yaris hatchback already on sale in Thailand, as is required by Eco-car regulations.

Setting new standards for the B-segment, such as seven airbags and improved braking, the Yaris ATIV is expected to overlap with the Vios and eat into its sales.

“Of course it’s a sedan of a similar size,” Suriyachantananont says. “The difference is the engine, which will segregate customers … (and) the freshness and the price will be a driver for sales.

“For Vios we might have to reduce the price,” he adds. “But there will still be customers who want a 1.5L engine, so we have no plan to end the Vios.”

Toyota sells about 2,500 Vios units a month in Thailand, but the Yaris ATIV could cannibalize up to three quarters of the model’s sales.

There are five versions of the Yaris ATIV, all equipped with the same 1.2L engine and a CVT, ranging in price from TB469,000-TB619,000 ($14,100-$18,600), which includes optional accessories up to a value of TB40,000-TB50,000 ($1,200-$1,500). Toyota plans to slightly raise basic prices in October.

With the Thai market showing signs of life after three years of decline and new buyers returning, Toyota perceives this to be the optimal time to launch the Yaris ATIV. “Most customers (will be) employees, students and first-time buyers,” Suriyachantananont says, noting the car’s four key selling points are interior and exterior design, comfort and ride, fuel efficiency and safety.

It comes with seven exterior colors and two interior trim options. Toyota will support sales with a payment scheme that includes options of no down payment, insurance included in monthly instalment payments and extended warranties.

The Yaris ATIV also is likely to affect the Yaris hatchback’s sales, but Suriyachantananont reckons the impact will be low. “Hatchback sales will maintain at 3,000 a month,” he predicts, adding the hatchback will receive a small facelift next month to freshen it up.

Sugata, meanwhile, says Toyota has set an ambitious sales target for the new Yaris ATIV of 4,700 units a month this year. Toyota Thailand will export the model, which already is being built in Japan from completely built-up kits. “Our Gateway Manufacturing Plant has been given a role to be a global production and export hub to serve over 70 countries,” he says. “We will export at 3,000 units per month” at the outset.

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