The FINANCIAL — With 1,260 vehicles sold in 2012 Toyota Center Tbilisi increased its sales by almost one and a half times compared to the previous year. However, Irakli Gurchiani, owner of Toyota Center Tbilisi, told The FINANCIAL that 2012 had been one of the most difficult years for his company.
“Due to the political situation in the country there was absolute stagnation in the economy which consequently had a negative impact on us,” said Gurchiani.
In his exclusive interview with The FINANCIAL, Gurchiani shared his views regarding the political changes within the country and his expectations regarding the beginning of a “renaissance” period in Georgia.
“Blessed are those who believe” – was Gurchiani’s response to the recent statement of Iberia Business Group, which stated that by 2018 Volkswagen will beat Toyota’s sales records.
Once again Toyota has been named the favourite car brand of the Georgian population, adding one more Golden Brand award to the list of the company’s achievements in the country.
“The primary impact of the political changes which occurred in October 2012 on our business was that our people were released from a state of fear, although economically we remain in a period of stagnation,” said Gurchiani. In his words, the current diarchy in Georgian politics is having a negative effect on businesses. He is confident that an improvement in the situation will begin to be seen in November 2013.
Some Georgian businessmen complained about the pressure they apparently faced under the previous government during their first meeting with the newly-elected PM Ivanishvili. Gurchiani said that he personally was not a victim of the previous government’s rule. However, he did say that the whole country was under pressure generally.
“It would be premature to make any predictions at this stage on whether a “renaissance” era has indeed started in Georgia, as prominent Georgian businessman Lasha Papashvili claimed after billionaire Bidzina Ivanishvili came into power. Although I do hope that it will start from 2014, so long as nothing unforeseen or major transpires,” he said.
Gurchiani said that the dissociation of politics and the economy will happen independently and in a natural way, but not yet. It will take time.
So far in 2013 Toyota Center Tbilisi has offered the new RAV4 to customers, which immediately became hugely popular. In August the company will be offering people the most successfully modified Corolla. Gurchiani predicts that it will cause a real furore. He himself has already seen the car and is therefore confident in making such a statement.
In 2012 the company sold 1,260 units. In 2010 sales reached 1,035 cars and in 2011 – 847.
Annual turnover of the company amounted to approximately GEL 300 million in 2012.
The Land Cruiser Prado Turbo Diesel was the best-selling car in 2012. The price of the car is USD 37,900. “In 2012 we started offering the Land Cruiser 200 to our customers but we have not been satisfied with its sales.”
According to Geostat, Toyota is among the top ten companies in terms of highest turnover. In general, the auto industry showed high results in the data of the Georgian National Statistics Office. Gurchiani explained the success of the auto industry in Georgia in the following way: “70% of turnover is made up by the actual cost of the car, a sum which flows out of Georgia to the producers.”
Japanese Toyota is the third best-selling car in Georgia. The amount of its exports in 2012 totalled 8,194 units for both new and used cars. Toyota is considered the main competitor of Volkswagen in Georgia. A representative of Iberia Business Group, official dealer of Volkswagen in Georgia, recently stated that by 2018 it will be causing a dip in the sales figures of Toyota.
“Georgia is a country of jeeps. Volkswagen does not offer a wide range of jeeps. It has only one model and a very expensive one at that,” said Gurchiani.
“The secret to Toyota’s success is its harmony, quality and price,” Gurchiani explained.
By volume of sales Hyundai is the closest competitor of Toyota in Georgia. “In terms of exact price and quality though we do not have any real competitors,” Gurchiani noted.
According to Gurchiani, in 2013 the company will at the very least double the amount of cars they imported in 2012.
In 2012, out of total sales 15% of cars at Toyota Center Tbilisi were bought by women. “We are a stable importer of cars. We do not distinguish cars by gender and have not recorded any significant increase in the number of women purchasing cars,” Gurchiani said.
“Women usually buy small and medium sized jeeps. Black and silver are the most popular colours. We have recently witnessed a change in people’s favourite choice of car colour actually,” he added.
According to Gurchiani, Toyota Center Tbilisi is not offering customers cars that run on gas. “I, personally, am afraid of gas. This is a global tendency. Toyota does not produce such cars.”
Fuel efficient models of Toyota sharply increased the company’s portfolio in the USA. As for the situation in Georgia, Gurchiani said that the desire to save money is already a widespread trend in Georgia.
“Fuel efficient cars are hybrid vehicles which we started importing a long time ago. The fact is that their popularity is low because of the high prices. In comparison with cars of the same dimension, hybrid cars allow one to save as much as USD 15,000 in three years. Georgian customers are not used to calculating costs in this way while in the USA it is a bestselling car because of people’s savings habits,” Gurchiani told The FINANCIAL.
Toyota Center Tbilisi has two brands in Georgia, those of Toyota and Lexus, although Toyota has other brands like Hyno, Daihatsu and Scion which are offered on American markets.
When a new Toyota model is issued it becomes available on the Georgian market almost instantly. “It’s only transportation which prolongs the process, taking from three to five weeks for vehicles to travel from Japan to Tbilisi,” Gurchiani said.
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