Toyota targets fleet growth but aims to reduce rental volumes

Toyota plans to strip out around 2,500 units from short-term rental this year after a big increase in 2014.

Neil Broad (pictured), general manager Toyota and Lexus fleet and remarketing, put that surge in rental registrations last year – which saw volume double to almost 11,000 - down to a decision to wash out surplus models of Aygo and Yaris ahead of the launch of new models.

“It was down to the transition between old and new Aygo and Yaris. We put cars into rental at the half-year point to free us up for the new models,” he said.

“This year we will do less rental but it’s still a genuine channel if it is done properly.”

Toyota has pre-agreed its rental volumes with its partners for the year based on its product schedules to remove any spikes in sales. 

It has taken similar action in Motability, which increased by one-third last year to 3,405 units.

“We set out two years to have a sustained presence in Motability that doesn’t vary,” said Broad. “We set out an annual plan that we committed to with Motability and our dealers. We sued to jump in and out but now we have a consistent approach.”

He added: “Residual value management is key. We lead the industry on PCPs in retail so it’s key for us to manage it. We maintain RVs for retail and fleet.”

Toyota is targeting market share of 5% in fleet (in 2014 it took just under 4%) which requires it to be competitive in every channel – local business, direct invoicing accounts, bodyshop and major fleets.

Matt Harrison, Toyota GB president and managing director, said: “We are a build-to-demand company; we don’t have to liquidate our product. Any growth has to be profitable.”

In the first two months of 2015, registrations in fleet have risen 40% year-on-year due to some residual demand carried over from late 2014 when Toyota ran out of Avensis stock. Meanwhile it started the March plate-change having already secured 65% order cover for the month.

“We expect to grow by 5-6% this year in a flat market based on new product and a full year of Aygo and Yaris,” said Harrison.