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Toyota's Prospecton plant suffered extensive water damage. Picture: SUPPLIED
Toyota's Prospecton plant suffered extensive water damage. Picture: SUPPLIED

It’s one of Toyota SA’s biggest annual product showcases but when sales and marketing vice-president Leon Theron met potential customers at the Nampo agricultural show in the Free State this week, his message was clear: “You can order but we can’t deliver.”

The floods in KwaZulu-Natal last month proved cataclysmic for Toyota. Its Prospecton vehicle assembly plant, in south Durban, was swamped — not just by water but also by thousands of tons of mud and silt. The plant, which builds the Quest and Corolla Cross cars, Hilux bakkie, Fortuner SUV, HiAce minibus taxi and Hino trucks, was forced to halt production.

The plant has resumed manufacture of export-bound catalytic converters and platinum-based appliances to reduce exhaust emissions, and hopes to begin Hino assembly by the end of May. Like most trucks, Hinos are imported into SA as kits and require basic assembly.

Prospecton’s other products are built from thousands of separate components and require full-scale manufacture. Much of the work is done by robots, which are particularly susceptible to mud. Some require cleaning, while others, says Theron, have been scrapped and replaced.

The Japanese parent company, Toyota Motor Co (TMC), has sent dozens of engineers and technicians to SA to manage Prospecton’s rehabilitation. TMC is also temporarily underwriting its subsidiary’s cash flow needs.

There is talk of a potential return to work in July but Toyota SA president Andrew Kirby says it’s too soon to predict. Whenever it happens, Toyota SA estimates the floods will cost it production of 45,000 vehicles. These include about 4,000 completed cars and commercial vehicles damaged by floodwater inside the plant and in external stockyards. These will be crushed.

We know we will lose volume. We have made peace with that
Leon Theron

The result is that, apart from a handful of pre-flood units scattered through the 265-strong dealer network, showrooms have no Quests, Corolla Crosses, Hiluxes, Fortuners or HiAces. Nor will they have for some weeks. Instead, showrooms are displaying more imported models like Rav4, Starlet and Urban Cruiser.

Theron says: “We will have extra units to compensate for the temporary lack of availability of locally built models.”

The imported luxury Lexus brand is also available, though in smaller numbers than usual because of a global shortage of components.

Some Toyota products cannot be substituted in-house. HiAce accounts for 98% of SA minibus taxi sales, while Hilux is the best-selling vehicle of any description on the local market. Taxi operators are historically so wedded to HiAce that they will wait for production to resume rather than move to another brand.

Life isn’t so simple for Hilux. Nissan and Isuzu both have capable new bakkie ranges, and Ford will launch its new Ranger bakkie in a few weeks. Last time there was a new Ranger, it temporarily knocked Hilux off top spot.

Then there’s the Volkswagen Amarok. Until now, it’s been available locally only as a double-cab bakkie, but it will soon be sold also as a single-cab, industrial or farming “workhorse”.

Theron admits that fleet replacement cycles will force some Toyota customers to switch, but says many current owners, including those at Nampo, say they hope to remain loyal. Orders can be taken but, given that some may have to wait months for delivery, some loss of sales is inevitable.

Corolla Cross is another vehicle that won’t easily be substituted. It is available both with a standard internal combustion engine (ICE) and as a hybrid, with dual ICE and electric motors. Demand for the hybrid version has surprised planners and though there are other imported Toyota hybrids available, they are much more expensive.

The crisis could not have come at a worse time for Toyota. In the first three months of this year, it accounted for 30% of all SA new-vehicle sales. Exports were also booming. Theron called the local performance “monstrous”. This month, however, sales could be 50% of previous levels. June could be even more difficult.

Nevertheless, Theron has told dealers that full-year sales targets remain unchanged for now — even if he concedes that actual sales could fall 19,000 below original projections. Once full production resumes, and overtime kicks in, local sales may get priority over exports to reduce the impact of market losses.

One reason Theron doesn’t want to downgrade targets yet is that Toyota is desperate to retain its sales leadership in the SA market; 2021 was the 42nd consecutive year that the company outsold all its competitors.

“I’ve made it clear that I’m not prepared to sacrifice that record for anyone,” he says. But he adds: “We know we will lose volume. We have made peace with that.”​

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