General Motors Co and Ford Motor Co announced sales incentives aimed at luring owners of Toyota Motor Corp vehicles, after the Japanese carmaker expanded recalls to fix accelerator pedals that may stick in some models.
GM’s programme follows “thousands of calls” to the carmaker’s dealers from Toyota customers who were concerned or wanted help buying a GM vehicle, said Steve Hill, general manager of retail activities for the Detroit-based company. Ford plans to offer $1,000 rebates to Toyota and Honda Motor Co customers to make them switch to its models, said Robert Parker, a spokesman for the Dearborn, Michigan-based company.
The incentives may help GM and Ford vie with Honda Motor Co and Hyundai Motor Co for customers after Toyota, the world’s largest automaker, halted sales of eight models involved in a January 21 recall, including its top-selling Camry and Corolla cars. GM Chief Executive Officer Ed Whitacre has said his company must sell more vehicles to make a profit this year.
“This is a good move by GM,” said auto analyst John Wolkonowicz of IHS Global Insight in Lexington, Massachusetts. “This helps GM, because while its quality is quite good and much improved, it hasn’t received the public accolades that Honda, Ford and Hyundai have.”
Honda and Nissan won’t introduce any campaigns or incentives targeting Toyota vehicle owners, Yasuko Matsuura, a spokeswoman for Honda, and Mitsuru Yonekawa, a spokesman for Nissan, said separately today. Hyundai Motor isn’t planning incentives similar to GM and Ford’s, Vice President Park Dong Wook said in Seoul.
GM’s campaign, which began yesterday and runs until the end of February, is available for most Chevrolet, Buick, Cadillac and GMC models and targets owners of 2.3 million Toyota vehicles recalled on January 21.
GM will offer no-interest loans of as long as 60 months for purchases of one of its new models with a Toyota trade-in, Hill said. For Toyota lease customers, GM will make as many as three payments up to a total value of $1,000, and dealers will offer another $1,000 toward trade-in assistance, he said.
“Safe and high-quality transportation is a reasonable request from a customer,” said Susan Docherty, head of GM’s US sales and marketing. “We want to be able to provide peace of mind to customers and all of our vehicles are safe.”
Ford Motor Co is offering $1,000 rebates to owners of Toyota, Lexus, Scion, Honda and Acura models through March 1, Parker said. The offer is available to anyone trading in a 1995 or newer model Toyota or Honda.
“We’ve never been in a better position to have a shot at these people,” Parker said in an interview. “Our quality is now as good as Honda and Toyota, if not better.”
Ford dealers will begin offering the rebates to Toyota and Honda owners January 28. They are also available to consumers who lease Toyota or Honda models and have a lease expiring by June 30. The offer excludes all of Ford’s 7hybrid models, the Ford Edge all-wheel-drive SE model, the F-150 Raptor pickup truck, the Taurus SE sedan, the Shelby GT500 and KR versions of the Mustang, Parker said.
“There are owners of Toyota, Lexus and Scion models who are looking for an alternative right now and we have the right product,” Parker said. “If there is a Toyota Camry owner looking to replace that vehicle, they could look at the Fusion.”
Ford included Honda in its rebate program because Toyota owners may also consider models like Honda’s Accord, Parker said.
Toyota had no comment on the GM incentives, said Celeste Migliore, a spokeswoman for the Japanese automaker. Toyota is evaluating its own advertising and marketing efforts, she said.
Consumers intending to buy a Toyota vehicle fell to 13.1 per cent on January 25 and 26 from 13.9 per cent during the week that ended January 17, according to Edmunds.com, a Santa Monica, California-based company that tracks vehicle pricing.
Toyota fell 2.3 per cent to close at ¥3,620 in Tokyo trading.
US law required Toyota to stop sales of the eight models until it fixes the “dangerous” pedal flaw, the National Highway Traffic Safety Administration said yesterday. Toyota made that move on January 26 and also ordered a production halt.
The Toyota City, Japan-based company said US sales of the affected models are being stopped indefinitely while it figures out how to fix a problem with accelerator pedals that could cause them to stick. A spokesman, Mike Goss, said he didn’t know how much production would be lost at five plants.
Along with the Camry and Corolla, last week’s Toyota recall covers the Avalon sedan and Matrix hatchback; RAV4, Highlander and Sequoia sport-utility vehicles; and Tundra pickups. Also included is the Pontiac Vibe, a version of the Matrix built at a joint Toyota-GM plant until last year.
The models accounted for 56 per cent of the automaker’s US sales last year, said Koji Endo, managing director of Advanced Research Japan in Tokyo.
Toyota’s US market share may decline by 2 percentage points to 4 percentage points because of negative publicity, Joseph Amaturo, an analyst at Buckingham Research Group in New York, said in a note to investors yesterday.
GM’s market share may temporarily increase 2.4 per cent, Brian Johnson, an analyst at Barclays Capital in Chicago, said in a note to investors yesterday. Honda may gain 2.1 per cent and Ford may go up 1.6 per cent, he said.
Those gains are based on Ward’s Automotive’s figure for Toyota of an 18.2 per cent share of the retail sales market, which excludes sales to fleet customers. Hyundai Motor may gain about 0.7 per cent of the US market, Barclays said.
“We discussed doing a programme aimed at Toyota and decided it wasn’t appropriate,” said Chris Hosford, a Hyundai Motor spokesman. “We are taking steps such as making sure our dealers have adequate supply. But we don’t want to jump on this thing like a vampire.”
Chrysler doesn’t have any plans for new incentives, said Dianna Gutierrez, a spokeswoman.
