Edmunds.com: One Year On, Lingering Safety Concerns Are Not All That Ails Toyota
SANTA MONICA, Calif. — January 25, 2011 — One year after Toyota's highly publicized issues with unintended acceleration, some car buyers are still avoiding the brand, according to shopping metrics provided by Edmunds.com, the premier online resource for automotive information. In December, 17.9 percent of car shoppers considered Toyota vehicles — 2.3 percentage points below the levels in December 2009. Overall, Edmunds finds that 2010 consideration for Toyota vehicles was down about 3.8 percentage points year over year.
Last year, Toyota was the only major automaker to see a drop in overall sales (-0.3%), falling from #2 to #3 in U.S. market share. The decline came even as Toyota offered the highest year-over-year jump in dealer incentives (+33%), according to Edmunds.com. That means many consumers shunned Toyota even as the company offered bigger discounts.
"Toyota needs to overcome not just the PR damage sustained by last year's recalls, but also the reality that many of its models are stale," said Jessica Caldwell, director of pricing and industry analysis. "In the last few years Toyota's lineup has remained relatively untouched compared to the changes its top competitors have made to their fleets. In today's competitive marketplace, updating the product line is more important than ever, especially as most new car buyers cross-shop online without much product loyalty, and many dismiss the cars that are lacking desirable new technology features."
Evolving cross-shopping patterns on Edmunds.com also demonstrate the diminished power of Toyota's brand. Consumers interested in traditional competitors like Nissan and Honda considered Toyota vehicles less often in 2010. Meanwhile, Suzuki shoppers — who typically qualify for higher APR loans, accept longer loan terms and make lower down payments, suggesting a lower economic status — increased their Toyota consideration significantly in the last year.
In recent months, though, some specific Toyota models are elbowing back in on traditional competitors. The rate of Edmunds visitors cross-shopping the Nissan Altima with the Toyota Camry, for example, has approached levels seen before the reports of unintended acceleration captivated the media and its audience last year.
Earlier this month, Edmunds' AutoObserver.com reported that Toyota (including Lexus and Scion) plans to release 11 new or redesigned models in 2011. Updates to the Camry and RAV4 — two of Toyota's traditional top sellers — are expected to be included in the 2011 Toyota redesigns.
"In the end, new products and new designs attract car buyers," said Caldwell. "Incentives work, too, but new products are a far better investment for car companies long term."
About Edmunds.com, Inc. (http://www.edmunds.com/help/about/index.html)
Edmunds.com Inc. publishes Web sites that empower, engage and educate automotive consumers, enthusiasts and insiders. Edmunds.com, the premier online resource for automotive information, launched in 1995 as the first automotive information Web site and hosts the most established automotive community online. Its mobile site, accessible from any smartphone at www.edmunds.com, makes car pricing and other research tools available for car shoppers at dealerships and otherwise on the go. InsideLine.com is the most-read automotive enthusiast Web site. Its mobile site, accessible from any smartphone at www.insideline.com, features the wireless Web's highest quality car photos and videos. AutoObserver.com provides insightful automotive industry commentary and analysis. Edmunds.com Inc. is headquartered in Santa Monica, California, and maintains a satellite office in suburban Detroit. Follow Edmunds.com on Twitter@edmunds and fan Edmunds.com on Facebook at http://www.facebook.com/edmunds.