LOS ANGELES -- Toyota is putting big money into dealer ad associations and broadcast network TV and is also boosting residuals -- all in an effort to increase fourth-quarter sales.
The Toyota brand was the biggest benefactor from cash for clunkers, but U.S. sales for the brand fell 45 percent in September compared with August, and they were down 13 percent compared with September 2008. To rebuild momentum, Toyota Motor Sales U.S.A. plans to spend $1 billion on a marketing blitz during the quarter, mostly on Toyota Division.
The company declined to offer details on the ad spending. But dealer sources say the contribution to the regional dealership advertising groups during the fourth quarter will increase. Toyota will pay 50 cents for every dollar the ad associations spend compared to the 32.5 cents the associations normally get. Toyota also will spend more money to tout the brand on broadcast network TV.
In addition, Toyota Financial Services has raised the residual value on all 2009 and 2010 Toyota cars and trucks by 3 percent. Dealers say the boost in residuals should increase the brand's lease business.
"That's a gutsy move," Los Angeles Toyota dealer Dave Conant says of the bump in residuals. "That could translate into a $20- to $25-per-month lower payment. It could be the tipping point for a lot of people. They're betting the values will be stronger. They're willing to take the hit, to take that chance to spur sales."