√Toyota says stock shortages, delivery delays to last another year

Despite working overtime and record production levels, the world’s biggest car maker estimates it will struggle to keep up with demand for another 12 months.

Toyota Australia has delivered a grim warning for anyone in the queue for a new car – while at the same time apologising again for the extensive delays.

The sales and marketing boss of Toyota Australia, Sean Hanley, has told a media conference in Sydney overnight severe stock shortages and delivery delays are expected to continue throughout next year.

This is the third time the car industry has forecast another year of delays, and waiting times remain at record levels.

Most major car companies have wait times of three to nine months. Some Toyota models – such as the Toyota RAV4 Hybrid and Toyota LandCruiser 70 Series – have wait times of up to two years.

“The main challenges today – not just for us, but for the entire industry – are the availability of semiconductors, precious metals, and labour.

“I have to tell you, it’s becoming clearer by the day that the supply challenge is not going to be resolved as quickly as we’d all hoped.

“In fact, our best estimate is that the semiconductor shortage affecting the entire automotive industry is likely to continue through 2023.

“You are going to see this kind of ride for a little while longer. At the moment it’s just difficult and challenging.”

Toyota says production is at near-record levels however demand in Australia has been extraordinarily high.

“Unfortunately, wait times are not getting shorter, which puts the onus firmly back on us and our dealers to take our customer communications to the next level.

“People basically are reasonable,” said Mr Hanley. “They understand why delays are occurring. All they really want is to be kept informed.

“At the same time, there’s also evidence of a shift in the mindset of some customers. We’ve noticed an interesting response from a small group of people who are actually building extended wait times into their purchase plans.

“They continue to order cars today, on the basis that their new (vehicle) won’t be delivered until well into next year.”

The Toyota Australia executive said rising interest rates were yet to apply the brakes to new-car sales.

“We’re very much aware that Australians are facing upward pressure on their home-loan repayments and other factors that are driving up the cost of living,” said Mr Hanley.

However, he noted: “In terms of the overall economy, I don’t think we’re going to fall off a cliff anytime soon.

“We’re cautiously optimistic about next year, though our circumstances may be very different to others.

“We are hearing used-car prices might be starting to come down a little. That’s always a lead indicator. Interest rates of course going up, inflation is of course quite high at the moment.

“But the lead indicator that I always look at is unemployment, and right now we are fully employed as a nation, which is encouraging.

“You have to watch that unemployment level. If that stays where it is or … moves only slightly, I think we can be fairly optimistic.”

Mr Hanley conceded Toyota still has a “big job to do with customers and we know that.”

“I have apologised on behalf of the company, but to be quite honest an apology won’t cut it anymore,” said Mr Hanley.

“We need to go to the next level. So we’re working on new methods. How do we get through this period? How do we continue with the trust we built over decades and try to keep our customers happy?

“Our commitment right now is to try and reduce our order bank and get these cars to customers who’ve been waiting a long time. That’s the only thing we’re focused on right now.”

Mr Hanley said Toyota was not spooked by last month’s uncharacteristic 26.5 per cent sales decline because “sales these days for all car companies are really just a reflection of how many cars turn up.”

“From Toyota’s perspective, we have an incredibly healthy order bank. Our sales are largely now being dictated by our arrivals. What you see in any given reporting month is what we can process … and dealer capacity (to deliver cars).”

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