NEW YORK—Toyota Motor Sales U.S.A., Inc. is scrambling to fix separate gas pedal and brake issues on upward of 7 million vehicles, as it faces an entirely new recall—that of certain 2010 model year Tacoma pickup trucks.
Last Friday, the company issued a voluntary recall to inspect the front drive shaft on around 8,000 2010 model year Tacoma four-wheel drive trucks. The shaft in such vehicles “may include a component that contains cracks that developed during the manufacturing process. As those vehicles are used, the cracks may eventually lead to the separation of the drive shaft at the joint portion,” the company said.
Owners will be notified by the company starting in mid-March.
While the latest in a string of recalls is smaller, it is the latest black eye endured by Toyota. The company is currently fixing gas pedal issues on numerous Toyota and Lexus models globally, and more than 430,000 Priuses for certain brake issues.
The company has faced public scorn and doubts about its quality, which had been perceived as among the best in the industry judging by its numerous J.D. Power & Associates reliability awards.
The House Energy and Commerce Committee will hold a hearing called “Toyota Gas Pedals: Is the Public at Risk?” on Feb. 24. In addition, the company is facing dozens of lawsuits from consumers alleging anything from injuries to lost value on their vehicles.
In a recent study, KBB said that as of last week, 27 percent of prospective car buyers who said they were considering purchasing a Toyota no longer are considering the brand for their next purchase. That figure is 6 percent higher than the previous week, following the initial recall announcement.
The reputation hit is spreading to Toyota’s other brands. Twenty-eight percent of those considering a Scion and 23 percent of those considering a Lexus are no longer considering their purchases. In addition, the perceived value of a Toyota vehicle—in the past having one of the best resale values on KBB—has dropped.
“We are seeing a softening of both used Toyota values and the New Car Blue Book values of new Toyotas this week,” Juan Flores, director of vehicle valuation at KBB, said in a statement. “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.”
“We are seeing shoppers on kbb.com lean more toward competitors, especially the domestics like Ford and Chevy who are offering enticing conquest incentives,” said James Bell, executive market analyst for Kelley Blue Book’s kbb.com.
Industry rivals Ford Motor Co. and General Motors Co. are taking advantage of fretful Toyota owners, offering incentives for any Toyota trade-ins to purchase a new Ford or GM vehicle. Ford is offering $1,000 in trade-in cash, and GM offers a similar program as well as zero-percent financing on most models.
“Toyota is going to have to work extra hard for quite some time to overcome the “double-whammy” it is seeing with the continuing drop in values and consumer brand consideration,” Bell said.
Toyota, on the other hand, is scrambling to reassure current owners and potential customers. The company is considering granting longer warranties and steeper cash discounts to lure potential buyers, according to a Bloomberg report citing executives involved in the dealership discussions.
The company is throwing around an idea of including 10-year warranties and thousands of dollars in rebates on certain vehicles. Also, the company is awaiting the result of the congressional hearing to decide on any future action regarding warranties and promotions, the executives told Bloomberg.
Toyota declined to comment on the report.
Last Friday, the company issued a voluntary recall to inspect the front drive shaft on around 8,000 2010 model year Tacoma four-wheel drive trucks. The shaft in such vehicles “may include a component that contains cracks that developed during the manufacturing process. As those vehicles are used, the cracks may eventually lead to the separation of the drive shaft at the joint portion,” the company said.
Owners will be notified by the company starting in mid-March.
While the latest in a string of recalls is smaller, it is the latest black eye endured by Toyota. The company is currently fixing gas pedal issues on numerous Toyota and Lexus models globally, and more than 430,000 Priuses for certain brake issues.
The company has faced public scorn and doubts about its quality, which had been perceived as among the best in the industry judging by its numerous J.D. Power & Associates reliability awards.
The House Energy and Commerce Committee will hold a hearing called “Toyota Gas Pedals: Is the Public at Risk?” on Feb. 24. In addition, the company is facing dozens of lawsuits from consumers alleging anything from injuries to lost value on their vehicles.
Consumer Interest Wanes
Toyota’s reputation among consumers is quickly dropping, according to a recent report by industry researcher Kelly Blue Book (KBB).In a recent study, KBB said that as of last week, 27 percent of prospective car buyers who said they were considering purchasing a Toyota no longer are considering the brand for their next purchase. That figure is 6 percent higher than the previous week, following the initial recall announcement.
The reputation hit is spreading to Toyota’s other brands. Twenty-eight percent of those considering a Scion and 23 percent of those considering a Lexus are no longer considering their purchases. In addition, the perceived value of a Toyota vehicle—in the past having one of the best resale values on KBB—has dropped.
“We are seeing a softening of both used Toyota values and the New Car Blue Book values of new Toyotas this week,” Juan Flores, director of vehicle valuation at KBB, said in a statement. “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.”
“We are seeing shoppers on kbb.com lean more toward competitors, especially the domestics like Ford and Chevy who are offering enticing conquest incentives,” said James Bell, executive market analyst for Kelley Blue Book’s kbb.com.
Industry rivals Ford Motor Co. and General Motors Co. are taking advantage of fretful Toyota owners, offering incentives for any Toyota trade-ins to purchase a new Ford or GM vehicle. Ford is offering $1,000 in trade-in cash, and GM offers a similar program as well as zero-percent financing on most models.
“Toyota is going to have to work extra hard for quite some time to overcome the “double-whammy” it is seeing with the continuing drop in values and consumer brand consideration,” Bell said.
Fixing Its Reputation
According to a Wall Street Journal report, AutoNation CEO Mike Jackson said that Toyota has repaired fewer than 5 percent of the vehicles it has recalled in the United States.Toyota, on the other hand, is scrambling to reassure current owners and potential customers. The company is considering granting longer warranties and steeper cash discounts to lure potential buyers, according to a Bloomberg report citing executives involved in the dealership discussions.
The company is throwing around an idea of including 10-year warranties and thousands of dollars in rebates on certain vehicles. Also, the company is awaiting the result of the congressional hearing to decide on any future action regarding warranties and promotions, the executives told Bloomberg.
Toyota declined to comment on the report.
