Toyota to offer more incentives
The automaker's March sales rise 40%. It's hoping that good deals will trump bad publicity from its recall problems.
Updated at 5:55 p.m. ET
Toyota Motor (TM) plans to extend no-interest loan and discount lease offers for at least another month and may make free maintenance standard for all U.S. buyers.
The move comes as the Japanese automaker tries to rebound from recall problems.
The company will announce its plans Monday, when its current incentives expire, Bob Carter, group vice president of Toyota’s U.S. sales operations, told Bloomberg News today.
"We’re looking at having a little bit different execution of complimentary maintenance. The feedback from customers has been very positive," he said at the New York International Auto Show. "What you will see us do is stay aggressive on the short term."
March sales surged 40%, Carter told The Associated Press today.
Automakers are scheduled to release March sales figures on Thursday. Most analysts see sales rising -- because of all those incentives.
Toyota’s March incentives probably helped boost its U.S. sales for the month, Carter said. The world’s largest automaker is working to repair its reputation after recalling 8.5 million vehicles worldwide to fix defects linked to unintended acceleration and to adjust brakes.
The company starting early this month offered Corolla, Matrix and Yaris cars, Venza wagons, RAV4 and Highlander sport- utility vehicles and Tundra pickups with no-interest loans of as long as five years.
Its incentives also included lease discounts on models including Prius hybrids, as well as free maintenance for two years to repeat Toyota buyers.
The maintenance offer probably will be extended to first- time Toyota buyers, Carter said, without elaborating.
The March sales increase for Toyota and Lexus vehicles "will be big; 3% is a floor," he told Bloomberg. "There’s been speculation about the safety of our vehicles, but if consumers really felt that way I couldn’t develop a marketing plan to sell around that."
Toyota's aggressive incentives (plus incentives from General Motors) may limit Ford Motor's (F) ability to raise prices, The Wall Street Journal said today.
The Journal cited a report from Buckingham Research that argues Toyota's incentives may be forcing Ford to get into the incentive game, too. That would definitely hit profits.
Ford was down 5.4% to $12.57 this afternoon, in part because a health care trust for United Auto Workers retirees expects to raise about $1.78 billion from the sale of warrants to buy the company’s stock.
The stock had reached $14.54 during the quarter before falling back.
Toyota's American Depositary Units were down 1% to $80.42 this afternoon. They're down 4.2% from Dec. 31 but up 12.5% since bottoming at $71.55 on Feb. 23.
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