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Toyota loses ground to cheaper brands
Toyota sedans are struggling to gain a larger market share in Laos as the influx of cheaper Chinese and Korean cars into the country continues to rise, according to a vehicle dealer.
“Our market share is about 10 percent and it is not easy to make it any bigger,” Lao Toyota Service Director Mr Praxatxay Philaphandeth told Vientiane Times on Thursday.
However, he said buyers of Toyota sedans and Korean and Chinese cars were different kinds of people, adding that purchasers of Toyotas are usually high income earners.
The number of Chinese and Korean sedans entering Laos has been steadily rising over the past few years, posing a strong challenge to the Japanese brand that has been established here for several decades.
The price of a Chinese sedan is around US$13,000 while equivalent models from Korean car makers Hyundai and Kia are about US$18,000 to US$22,000. This compares to around US$30,000 to US$49,000 for a Toyota sedan.
Mr Praxatxay said that despite the increasing number of Chinese and Korean cars in Laos, Toyota still had the largest market share, which currently stood at about 40 percent.
He said one of the main factors keeping the Toyota brand on top was the rise in sales of the Vigo pick-up truck, one of the most popular Japanese models in Laos.
In 2010 the company sold about 2,400 vehicles, a 13 percent increase on the previous year thanks to robust foreign investment and continuing economic growth in Laos. About 85 percent of the vehicles were Toyota pick-up trucks, including the Vigo.
“There were many investment projects taking place in Laos last year. They all needed pick-up trucks,” Mr Praxatxay said.
Lao Toyota Service expects to see a further 10 percent growth in sales of Toyota models this year for the same reason.
The Lao automobile market has been growing rapidly over the past five years with more than 1 million vehicles now on the roads and one in six people currently owning a vehicle.
Brand names available in Laos include Mercedes Benz, Ford, Isuzu, BMW, Nissan, Hyundai, KIA, Honda, Chery, BYD and Land Rover.
vientiane times
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