The problems faced by Toyota may be just what U.S. car companies need to boost sales and snare market share away from a competitor.
Toyota, the top selling vehicle manufacturer in the world, has been knocked to the mat over faulty brakes and sticky accelerators that resulted in a recall on some of its most popular brands of cars, crossovers and trucks, including the Prius hybrid and the luxury Lexus HS 250h.
In response, first General Motors Corp. later followed by the Ford Motor Co. began offering $1,000 incentives for buyers who come in with a Toyota trade in.
The safety problems has generated a fear among car owners so much so that even a Lexus owner came in recently to Galpin Ford in North Hills to trade in their 2010 vehicle for a Ford.
The dealership is stocking up on new models in anticipation of higher sales, said General Manager Terry Miller.
In addition to the $1,000 trade in, there are select customers who will be offered an additional $500 for buying a Ford.
“We have been contacting those customers and we have had a lot of calls from Toyota owners,” Miller said. “We’ve made a number of deals.”
Following a year in which the bottom fell out of vehicle sales and two of the Big Three filed for bankruptcy, the last thing the auto industry needed was more woes. This time though it was a foreign car company’s turn and one with a prized reputation of quality and forward thinking and the highest brand loyalty at that.
While GM and Ford are offering the trade-in incentives the competition will likely not take it much further than that and take a more aggressive stance.
After all, last year when GM and Chrysler were taking federal bailout funds and decreased production, Toyota wasn’t publicly jumping with joy.
“They want to increase market share but they want to do it with good competitive products and not by denigrating anyone,” said Mark Rikess, of The Rikess Group, a Los Angeles-based consultancy for the auto industry.
Even Mark Reuss, president of GM’s North American division, acknowledged to reporters at the Chicago Auto Show that there will be opportunity for GM to get new customers but preferred winning on an even playing field.
Miller, of course, is betting on Ford to bring in the Toyota loyalists.
