Toyota axes TRD

After just 888 sales and a range of setbacks, including a safety recall for an engine failure, Toyota Australia has killed its TRD division.

The decision to close the go-faster shop has cost an estimated $20 million in research-and-development, dealer facilities and a production tie-up with Prodrive in Melbourne although the 17 staff at TRD will be moved to other jobs within Toyota Australia.

The final TRD Aurion and HiLux models will be produced before the end of March and stocks are likely to be cleared early in 2009.

Toyota denies any embarrassment over the TRD failure, its first since ending Daihatsu sales in Australia, but admits it was not making money and had little chance of a black-ink bottom line.

"It was costing us more than it was returning. Our forecast was that we would have had to continue to invest for a period of time, a number of years not a number of months," admits Peter McGregor, who was responsible for TRD.

"We're talking about an operational change to the total Toyota business. We've had to make some tough decisions."

McGregor says the current economic situation has also put pressure on TRD, which is not making its projected sales results.

"It was working reasonably well. HiLux was selling 50 to 60 units a month, and we were doing about 34 Aurions, although that is slightly below what we originally thought we would do."

The numbers are far below the results achieved by Holden Special Vehicles and Ford Performance Vehicles, and TRD critics are already claiming a success in the brand's failure.

They say go-faster Toyotas were never going to succeed in Australia, despite the company's investment in supercharged V6 engines for the Aurion and HiLux.

The TRD operation was planned as a way of winning new buyers to Toyota showrooms, as well as converting younger customers, by adding some spice to cars which are known for their vanilla flavour.

"Vanilla can be quite nice if you get the right brand. And we have the luxury brand in Lexus," says Mike Breen of Toyota Australia.

The TRD operation will be closed after less than two years and the decision means there is no need to continue development of a third TRD model.

"There definitely won't be a third model. Although there were a number under consideration," says McGregor.

All TRD vehicles will continue to be covered by Toyota's warranty.

The failure of TRD has been offset this week by an upcoming record for Toyota Australia.

It has hit an export milestone, shipping more than 100,000 vehicles overseas in a single year.

The record car was part of a shipment of 2100 vehicles which left Melbourne on Christmas Eve.

Toyota Australia is now forecasting total exports of 101,563 for 2008, an industry record, up from 96,688 in 2007.

Its production at Altona is now overwhelmingly focussed on exports, with local sales of the Camry and Aurion only totalling around 40,000 cars.

"This is Australia's biggest automotive export program, generating

$1.8 billion a year in export revenue," says Dave Buttner, Toyota Australia's senior executive director of sales and marketing.