Toyota Decision Hits Dealers Hard
At hundreds of Toyota showrooms around the nation, auto dealers were forced Tuesday to do the unthinkable: Put many of their shiniest, most desirable models off limits to buyers.
Toyota's recall of eight models was damaging enough, affecting about 55 percent of new-car inventory. But it also included Camrys and Corollas, the second- and fourth-best selling vehicles in the U.S. last year, respectively. Dealers now have significantly diminished inventory to sell and the prospect of having to quell shoppers' safety fears.
At Rodland Toyota in Everett, Wash., workers corralled 76 new cars and 35 used cars that could no longer be offered for sale, about a third of its inventory. But dealer Buzz Rodland said the short-term hit will mean long-term gain with customers.
"In this business, there is nothing more important than safety, and no manufacturer is immune from defects," he said. "I've never seen Toyota more focused than they are right now."
Just as the new-car market was brightening, however, Rodland said he's having to move from a sales offensive to a defensive posture. He says he knows the next few weeks will be slow. He's also readying more cars for his rental fleet, ones that aren't affected by the recalls, to have them for customers getting eventual recall repairs.
Dealer staff around the country were peering under cars' dashboards Tuesday to see what supplier made the gas-pedal assembly. Some models use parts from suppliers other than the one whose parts are suspect, so they can still be sold. Dealer Marsha Shields, president of the McCombs Foundation that runs several dealerships around San Antonio, said she still has cars to sell because their modules were made by Japan's Denso, not U.S. supplier CTS. "It's easily identifiable, so that's a good thing for the consumer and the retailer," she said.
At Toyota Santa Monica in California, President Michael Sullivan said he's glad Toyota acted, and he hopes his strong sales of Prius - an unaffected model - will cushion the impact.
Adam Lee, whose family-run auto group has Topsham Toyota in Topsham, Maine, said he told his staff that they are going to have to try harder to sell used cars for awhile. He said he's confident he won't have to have layoffs.
While devastating for Toyota dealers, the decision to stop selling eight models creates opportunity for rival brands consumers may have overlooked.
"Every dog has its day," said Jerry Seiner, who has a group of General Motors and dealers of other brands around Salt Lake City. "Maybe they'll take a second look at us instead of Toyota. . . . When Toyota stumbles, it's our opportunity."