Cars

Toyota Avalon jockeys for livery market

Shawnee Wandless, sales manager at Acton Toyota of Littleton, with a 2013 hybrid Avalon with the black-on-black livery package.
Shawnee Wandless, sales manager at Acton Toyota of Littleton, with a 2013 hybrid Avalon with the black-on-black livery package. Credit: Bill Griffith for The Boston Globe

LITTLETON — Seeing a Toyota Avalon dressed up in black-tie livery, ready for duty as a limousine, is one of those “I didn’t see THAT coming” moments. It’s much like the evening when the little boy next door suddenly is all grown up and out on the front lawn in a tuxedo taking senior prom pictures.

The Avalon has been a somewhat hidden jewel as a near-luxury sedan in the Toyota lineup. Discriminating buyers appreciated its quality, reliability, and value, feeling they were buying a Lexus without the added initial cost.

However, dress up the Avalon in black with a black leather interior, put a chauffeur at the wheel, and suddenly you have a new player on the limo scene.

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When Ford discontinued the Lincoln Town Car after the 2011 model year, the immediate question became: What will limo companies buy to replace it?

Automakers are quick to fill a perceived opening (sales vacuum) in the marketplace.

Lincoln (MKT), Cadillac (Escalade, XTS), and Chrysler (300) all were queued up to grab a share of that Town Car’s market, which had been approximately 80 percent of limousine sales for the past 25 years.

While the Town Car isn’t going to disappear immediately, the composition of limousine fleets already has started changing.

The country’s 12,000 livery companies purchase between 4,000 and 6,000 new vehicles annually, keep the average limo in service for about five years, and drive each one between 40,000 and 50,000 miles per year.

Toyota’s marketing folks had an idea they could capture a share of this market; however, the double whammy of the tsunami and worldwide recession delayed that initiative.

“As Toyota recovered from the tsunami, just after the launch of the limo, we couldn’t get cars. When they finally arrived, it was in a non-buying time for the industry,” says Shawnee Wandless, sales manager at Acton Toyota of Littleton.

Now he has inventory, a major presence on the web (Google “Avalon black car” or “Avalon livery” and Acton Toyota comes up first), and is making sales around the country.

The Avalon presents an intriguing product in the black-on-black livery edition (black exterior, black leather interior). It comes in only two versions, an XLE grade with the 3.5-liter V6 or with a hybrid power train.

For each, the livery package deletes the Avalon’s standard sunroof, back-up camera, smart key, heated front seats, and inside mirror with garage door opener. It replaces them with heated rear seats and rear climate controls.

Wandless has a chart on the Acton Toyota website that makes a compelling economic argument, showing the Avalon’s projected savings over a three-year period. The Avalon hybrid will save $7,060 over the gas-powered Avalon, $8,139 over a Chrysler 300, $21,476 over the Lincoln MKS, $27,071 over the Cadillac XTS, and $28,736 over the outgoing 2011 Town Car.

“A limousine operator’s biggest expenses are the original acquisition cost and fuel expenses,” he says. “Plus Toyota also has strong residual (resale or trade-in) value.”

The Avalon’s MSRP is $32,224 for the XLE and $34,839 for the hybrid. The hybrid is rated at 40 miles per gallon in city driving and 39 highway, while the gas version is 21 city, 31 highway, and 25 combined.

Mike Hills, general manager at Acton, uses a new Avalon as his daily driver. “I haven’t reset the odometer or mpg history,” he says, “and the digital readout says I’ve averaged 43.0 mpg in just over 4,000 miles of family driving.”

On the road, the hybrid is surprisingly peppy, having plenty of power even in ECO mode, the setting when you normally have to flog a Prius or Camry hybrid to experience normal performance.

Industry analysts see two roadblocks to Toyota’s entry into the limo market: the lack of prestige associated with the brand and questions of how the Avalon will hold up in heavy service.

“I’m surprised they didn’t use a Lexus for the limo,” says independent industry analyst John Wolkonowicz of Boston. “That brand oozes prestige, even more than Lincoln in recent years.”

“Still, I think the Avalon will do well in such applications as an airport service car, but doubt you’ll see it at proms and weddings anytime soon,” he says.

As for reliability, Wolkonowicz adds, “If you use a Toyota in civilian service and follow the maintenance schedule, the car is good for 300,000 miles. It will be interesting to see if the Avalon fares as well in heavier duty livery service.”

As is usually the case, Toyota is taking a conservative approach to its limo initiative. “You can say the company is planting a seed or putting a toe in the water,” says Acton’s Wandless.

The slow growth also gives Toyota time to gain acceptance in national affiliation agreements among limo companies who service each other’s customers in different areas of the country. For years, they’ve had guarantees that they’ll pick up passengers in either a Cadillac or Lincoln, a situation that likely will change with the proliferation of different vehicles in the industry.

“You’re already seeing that in Manhattan,” says good friend and recently retired banker Ken Nadler. “There are all kinds of models in New York’s black-car fleets.”

“Our sales expectations are reasonable,” says Tom Voll, Toyota’s Northeast fleet manager. “We’re planning on selling 500 units this year. We came to that number hoping to clip off 10 percent of the market as opposed to the 14 or 15 percent share we have in the regular retail market.”

Wandless is seeing the early returns, having delivered Avalon limos in New Orleans, Los Angeles, and San Francisco.

So far, the future is promising.

“We’ve got at least four more years with this body style,” says Voll. “We’ll tweak a few things for 2014, adding a rear power point, increasing rear-seat space, and restoring the back-up camera, which is a feature drivers have requested.”

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