The long prosperity of Toyota Corolla in China and Hidden opportunity for aftermarket entrepreneurs

In China, the C-segment (compact car segment) is the fastest growing segment and has large potential from the family car buyers group. The entry and mid-level C-segment is dominated by Korean background models such as the Hyundai Elantra and Buick Excelle.

With the launch of the new 1.8L Corolla (platform 238L) in May, 2007, Toyota China slashed the price of the old 1.6L Corolla (platform 316) to 127K RMB to make it a competitive new player in the entry and mid level C-segment car market. It will be a direct rival to the Buick Excelle and Hyundai Elantra. The new Corolla represents a characterless position that will expand its customer’s base significantly. In 2008, Corolla production reached 178,000 units, making it the No. 2 volume car in the C-segment in China, following the VW Jetta.

Looking into the future, about next 5 years, Toyota hopes that the old Corolla can sell around 65K units per year. Besides the Camry, the new Corolla is the second-highest volume car and could substantially help Toyota raise its market share in the future. These two Corollas will create major growth for Toyota China.

While Corolla sells well during the years, the Car-par will generate business opportunities for aftermarket players. Especially, the platform change from old 316 to 238, in 2012 from 238 to 140X, will re-structure the supply route for spare parts.