Toyota Satisfied to Remain Upmarket in Russia, for Now

VIENNA – In contrast to some global auto makers already producing or planning low-cost cars for the Russian market, Toyota currently has no plans to join the segment there.

“We have low-cost models in Brazil and India, so we can make vehicles in that category,” Alain Uyttenhoven, vice president-product management, Toyota Europe, tells WardsAuto. “But in Russia, Toyota is seen as a near-premium, upper-mainstream brand.”

According to Uyttenhoven, a low-cost car under the Toyota brand would overextend the marque in the country. “We don’t want to do that at the moment,” he says. “We believe there is still potential to sell more Toyota cars in the upper part of the market.”

The executive believes Russian car buyers may have problems with base-model Toyotas.

“I think Russia is the biggest market in the world for the Toyota Land Cruiser V-8. This vehicle is very expensive,” Uyttenhoven says. “If you were to come in with a vehicle for $15,000 now, people might not understand it.”

Another option would be the creation of a separate low-cost brand, as Renault did with Dacia in large parts of Europe, and as Nissan is planning with Datsun in Russia, India and Indonesia.

Uyttenhoven admits Nissan is proceeding very intelligently with the re-creation and rebirth of Datsun, without stretching the Nissan brand. However, Toyota has no plans for a separate low-cost brand. “It is potentially an option, but there is nothing on the table that would be decided at the moment.”

Toyota sold 117,786 passenger and light-commercial vehicles through September, up 37.4 % from like-2011. The brand is No.8 in sales in Russia.

In addition, the auto maker sold 11,407 Lexus luxury-segment vehicles, up 10.3 % from year-ago.

Toyota’s best-selling model in Russia in the year’s first nine months was the Corolla with 26,620 units, followed by the Camry with 25,753.

Uyttenhoven expects Russian sales of about 150,000 Toyotas and 17,000 Lexus vehicles in full-year 2012.

Toyota assembles the Camry at its Toyota Motor Mfg. Russia plant in St. Petersburg from complete-knocked-down kits sourced from Japan. Since adding a second shift in September, the auto maker is looking into the production of a second model in addition to the Camry.

“We have to decide which model should be built, and so on,” Uyttenhoven says. Asked about the timing, he says: “Give us a bit of time. It won’t happen next year.”

Toyota also is preparing for assembly of the Land Cruiser Prado from semi-knocked-down kits at the Sollers-Bussan joint venture in Vladivostok in Russia’s Far East.