Toyota to hand back $18m in JobKeeper payments

Australia’s number one car brand has decided to return its JobKeeper payments after new car sales rebounded dramatically.

Exclusive: Toyota will hand back more than $18 million in JobKeeper payments to the Australian Taxation Office after car sales rebounded in spectacular fashion in the final quarter of last year.

The company qualified for JobKeeper after its revenue dipped by more than 50 per cent at the height of COVID and national lockdowns in the middle of last year.

Toyota Australia president and chief executive, Matthew Callachor, said the company at the time was facing an “extremely uncertain future”.

Toyota says it has weathered the economic storm caused by COVID-19 better than most. Picture: AP

Dealerships closed for extended periods in Victoria and Tasmania, while demand for new cars slumped by 50 per cent in April — the worst monthly result in history.

“It was pretty grim. We just didn’t know where the automotive industry was going to go because we still are a discretionary purchase — not like food or shelter,” he said.

He said JobKeeper helped to provide job security for its 1364 employees around the country, but the company was “very fortunate to weather the storm better than most”.

By October, the car industry had recovered and the brand notched its strongest fourth quarter on record at the end of 2020, as sales soared by almost 30 per cent over the same period in 2019.

“Our situation now, on the basis of the last quarter and looking forward into next year, has normalised so we’ve been talking to the ATO and we’re actually going to hand that money back,” he said.

“We think it’s the right thing to do,” he said.

Toyota dealers say buyers have been looking to upgrade SUVs and 4WDs to explore Australia.

He said the company was still working out the final details with the ATO, but the move had been rubber stamped by its board, with the approval of head office in Tokyo.

Toyota ended last year with 204,801 sales, just 975 short of 2019.

Mr Callachor said lockdown led to a pent-up demand for new cars, helped by the fact that Australians were no longer spending large amounts of money overseas.

“Australians going overseas spend $26 billion more than people visiting the country so if nobody has the ability to go overseas, there’s money here,” he says.

As the COVID situation normalised, there was a sense of relief in the community that the economic outlook wasn’t as bad as first feared.

“Some of our research showed that people were saying ‘I’ve still got a job, I’ve still got an income, I’m going to go and give myself a treat, so to speak. The practical reality is I can’t go overseas, but I will travel locally and I’d like to actually get something that I feel really comfortable in,” he said.

Dealers reported buyers looking to upgrade SUVs and 4WDs to explore Australia.

The government’s offer of an instant tax write-off on purchases of business-related vehicles also helped to stimulate sales.

Toyota has been the number one in the Australian market for 18 consecutive years and accounts for one in five new-car sales.