Toyota Planning Incentives to Woo Customers Following Recalls
Toyota Motor Corp. has just experienced one of the most tumultuous years of its career, and as the crisis seem to keep getting worse, Toyota is working hard to get back on track to its glory days. It has been reported that Toyota is now considering offering more incentives to customers in an effort to woo them back into the stores, and to keep the inventory rolling.
Toyota is considering extending the the warranty on its vehicles to up to 10 years, along with rebates that run into the thousands of dollars. Toyota hopes that public memory is short-lived, and that they can soon recover from this crisis that followed a massive global recall of nearly 8 million Toyota vehicles. During the month of January, when the recall fever was at its highest, Toyota sales declined by 16 percent in the U.S. In comparison, the rest of the industry posted gains of 6.3 percent during the same timeframe.
“Toyota has got to be aggressive on this… Toyota has to put a wall around its customers.” said Mike Maroone, chief operating officer of AutoNation Inc., the biggest U.S. retailer of the automaker’s vehicles.
“The softening of values is a product of weakened consumer demand and the realization that Toyota is going to have to offer lower prices to get some consumers to consider Toyota vehicles again.” said Juan Flores, Director of vehicle valuation at Kelley Blue Book.
Meanwhile, U.S Department of Transportation Secretary, Ray Lahood expressed his reaction to the recall news in a strongly worded comment at Bloomington, Illinois “I want the American people and I want people who drive Toyotas to know that we’re gonna hold Toyota’s feet to the fire on this. This is very serious, we take it very seriously,”. The U.S. House Energy and Commerce Committee is also scheduled to conduct a hearing named “Toyota Gas Pedals: Is the Public at Risk?” later this month.
The recalls have so long affected up to a dozen Toyota models that include select 2009 Toyota RAV4 models, select 2009-2010 Toyota Corolla models, 2009-2010 Toyota Matrix, 2005-2010 Toyota Avalon, select 2007-2010 Toyota Camry models, select 2010 Toyota Highlander models, 2007-2010 Toyota Tundra, 2008-2010 Toyota Sequoia, 2010 Toyota Prius, 2010 Lexus HS 250h and most recently 8,000 2010 Toyota Tacoma 4WD trucks.
Although Toyota shares have declined 8.4 percent this year, Toyota closed the previous week on a comparatively higher note, with stocks rising $1.05 to $77.05 (1.4 percent) on Friday.