Toyota sticks with its incentives; Lexus leaps in
Kathy Jackson Automotive News -- May 3, 2010 - 6:02 pm ET
LOS ANGELES -- Toyota Division will stick with aggressive consumer incentives this month in an effort to hang on to its sales momentum. Meanwhile, Lexus Division has come out with a program of special leases and low interest rates.In April, Toyota-Scion sales rose 24 percent over April 2009 to 139,080 cars and trucks. Lexus sales climbed 29 percent to 18,359.Toyota Division began offering incentives March 2 after worldwide recalls of more than 8 million vehicles to fix defects linked to unintended acceleration and to adjust brakes.The division will continue with cut-rate lease deals and 0 percent financing on its most popular models.
Meantime, Lexus is touting special leases and low annual percentage rate loyalty programs in a one-month promotion called "Unprecedented Access." Toyota Division chief Bob Carter said leasing represented about 35 percent of sales last month, up from about 24 percent earlier this year. He said leasing will continue to play a key role in the division's strategy in the coming months."It's a key benefit for us," Carter said during a sales call today. "Customers like to change vehicles. We believe this is a strategy that can benefit the entire industry."Retail sales for Toyota-Scion were up 30 percent over April 2009. Carter said conquest sales accounted for about 40 percent of the division's volume for the second straight month -- similar to conquest rates before the recalls."That shows consumers don't care about the deal if they don't trust a brand," he said.Carter said Toyota will stick with rebates and sales for the short term but this summer will return to marketing brand attributes.
Lexus Division General Manager Mark Templin said the luxury brand's strong sales are a sign of economic recovery."There's a lot of momentum in the marketplace," he said. Templin said Lexus usually has a 20-day supply of vehicles, but production will be ramped up to achieve a 35-day supply.Meanwhile, Templin said more than 75 percent of Lexus' GX 460 inventory has been updated with new software to address a problem that could cause the vehicle to roll over.
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