Toyota’s large scale recall could irreversibly damage its reputation for quality and reliability, according to auto industry specialists and analysts.
The company has halted delivery of the vehicles affected by its latest recall, but consumers who have already purchased a vehicle have not been promised a refund or compensation. The recall relates to faulty accelerators that could get lodged in the “down” position and force the car to accelerate unintentionally.
General Motors Co. is capitalizing on the Toyota debacle and offering owners of Toyota vehicles up to $1,000 discount or complimentary financing as an incentive to trade in their vehicles for a new GM car or truck.
GM’s initiative was launched allegedly due to “thousands” of calls and e-mails to dealers and GM employees from Toyota owners asking for help, GM spokesman Tom Henderson said on Jan. 27. The incentive, which runs through the end of February, offers Toyota and Lexus owners three options to trade in their vehicles. Those who choose to lease a vehicle may waive three payments for up to a total of $1,000, qualifying customers who are financing a vehicle purchase can receive 0 percent financing for up to 60 months, or cash buyers can receive $1,000 off their purchase.
One of the key issues is how to deal with thousands of Toyota cars now stranded on dealer lots that are banned from being sold because of the faulty accelerator pedals.
“We’re developing the recall remedy even as we speak,” said Brian Lyons, a Toyota spokesman in Torrance, California.
Ford is also taking advantage of Toyota’s misfortunes by offering $1,000 to customers who will trade in their Toyota or Honda products, including Lexus, Acura and Scion models from 1995 onward. Honda is not affected in the recall.
“With the void right now and people needing vehicles, I’m sure there will be more interest in Ford,” Chief Executive Officer Alan Mulally said in a statement to reporters on Thursday on a conference call. “Everyone realizes that we are now equal to the best in the world, including Toyota.”
The European and China recall of Toyota vehicles was also confirmed due to the associated problems with the floor mats and accelerator pedals, however the extent of the recall is still to be determined because the production and standards vary from country to country.
Latest reports indicate that Toyota is close to producing a remedy for the pedal issue but it has not been formally announced or available to the public.
Friends Read Free