Since they're being given to government (public) departments, I'd imagine that there would be a decent sized discount. I could see how that could affect the cost per vehicle and overall sales.
You've got the right idea, with building more cars = cheaper production prices, but if I remember economics class - there starts to be a negative turnaround...where making such a number of cars isn't worth it anymore.
Now, if it's hurting sales,
All I know, is that if I ever see a Camry chasing me - I'll pull over, but with the confidence knowing I could easily get away
(not really, of course)