"We did take a gamble with tyres tonight, choosing to take the soft compound tyres for the shorter, night stages with rain forecasted.
However, the conditions were dryer than we expected, and after damaging our tyres in the opening tarmac super special stage in Lisbon, we had two badly-worn tyres on the rear, and good tyres on the front. We did lose some time with the tyres moving around a lot but it wasn't too bad and the times were still good."
Paddon and Kennard tackle new stages on Friday, local time.
"These will certainly be challenging as they are more technical and rougher than stages which are typically used in Rally Portugal. The weather will also play a part tomorrow as showers have been falling tonight which will make tyre decisions crucial."
The following day, the Kiwis face stages with a format unchanged from 2011 - the same three stages are run twice. Then on Sunday there are six further stages with the final test, the power stage, sure to attract thousands of enthusiastic Portuguese fans.