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Toyota Already Recovering from Recall, Edmunds.com Says

February 03, 2010

SANTA MONICA, Calif. — Edmunds.com has noticed that Toyota purchase intent has risen dramatically since the company announced a fix for its recall.

“Toyota purchase intent fell from 13.9 percent of Edmunds.com car shoppers to 9.7 percent during the height of the recall frenzy,” said Edmunds.com Senior Analyst David Tompkins. “Toyota purchase intent is back to 11.8 percent and seems to be climbing steadily.”

Where do Toyota competitors currently stand?

• Honda gained the most purchase intent at Toyota’s expense, increasing by 1.1 percentage points

• Ford purchase intent rose .8 percentage points

• Hyundai and Mazda purchase intent each rose .7 percentage points

• Nissan purchase intent rose .4 percentage points

• Volkswagen purchase intent rose .3 percentage points

• Chevrolet and Subaru purchase intent each rose .2 percentage points

“The Toyota recall stopped sales for about 55 percent of the company’s models, causing its monthly sales to drop below 100,000 for the first time since January 1999,” noted Edmunds.com Senior Analyst Ray Zhou. “However, we expect that Toyota will make a full recovery fairly quickly. And Toyota dealers may enjoy higher profit margins as they will have less inventory to offer because of the production stoppage while the company will likely boost demand through brand-building goodwill incentives.”

What about Toyota prices today?

"Affected Toyota's trade-ins have taken about a 10 percent hit in value; dealers will take them at a lower price because of the uncertainty even though many of them will end up enjoying a higher profit margin when they sell them in a few weeks after the recall issue is resolved,” according to Edmunds.com Analyst Joe Spina. 

“For unaffected vehicles, if there is an equal competitor in the marketplace – like the Honda Odyssey competes with the Toyota Sienna - there is as much as a three percent decrease in value for the Toyota today, but for vehicles without a direct competitor like the Toyota Tacoma we aren’t seeing any change in value. Once the recall is resolved, Edmunds.com anticipates Toyota prices will rebound quickly," Spina added.

Edmunds.com defines "purchase intent" as the measure of actual buyer interest reflected by pricing research, vehicle configuration and other focused steps. Purchase intent has a strong correlation to sales. The data reflects share of total Edmunds.com traffic engaged in purchase intent activity.

 

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