LOS ANGELES -- Toyota Motor Sales U.S.A. remains bullish for the rest of the year for both its Toyota-Scion and Lexus divisions. Toyota Division will continue to support sales with hefty incentives, but Lexus is dropping cut-rate leases.
Both Toyota and Lexus reported sales increases in May. Lexus jumped 31 percent to 22,216 vehicles, “twice the growth of the rest of the luxury” segment, Lexus General Manager Mark Templin said during a sales call today.
Toyota Division’s increase was more modest: up 4 percent to 140,597 cars and trucks. But it was the third straight month that Toyota sold more retail vehicles than any other brand.
“That shows the consumers are voting for us with their dollars,” Toyota General Manager Bob Carter said during the call.
Toyota Division moves into June with the same 0 percent financing and subsidized leases that it has offered since March -- some of the most generous spiffs in the industry. This month, the offers will be on 2011 models. In the previous months, the offers covered 2010 models.
Carter said a dearth of 2010 Camrys that could qualify for the financing offers last month was one reason for the car’s 7 percent sales decline in May.
Quality and safety
Toyota Division also has begun running new ads stressing quality and safety. The first ad talks about the brand’s Star Safety System, which is standard on every Toyota vehicle. The system includes antilock brakes, electronic brake force distribution, brake assist, traction control and stability control.
The other ad will say Toyota is spending $1 million an hour to enhance vehicle safety and technology.
“Our national marketing will be about the attributes of our products,” Carter said. “Some customers still are confused. They want to hear about our position on safety and quality.”
But he said Toyota Division must keep the incentives flowing as well.
“Even though we continue to see the market improving, this market is very competitive,” Carter said, “and we will do what we need to do to stay competitive.”
Lexus’ Templin, though, said the luxury brand would not continue the cut-rate leases or the “Unlimited Access” campaign that promoted them in May. In June and July, he said, Lexus ads will emphasize the brand, featuring clips of the upcoming 2012 LFA performance car, due next year. The LFA already is sold out.
“This will all be about the desire for the Lexus brand,” Templin said.
Inventory will increase
Carter said inventory to Toyota dealers will increase 25 percent over the next 90 days, with a higher mix of that inventory being light trucks.
Carter noted an uptick in sales of light-duty trucks, particularly the 4Runner SUV and Tundra pickup. Tundra sales rose 32 percent, while 4Runner sales more than tripled. Carter said sales would have been higher on those and other light-truck models had there been more inventory.
“It looks like we’re going back to light trucks a little more quickly than anticipated,” Carter said. “That’s why we’re adjusting the mix.”
Carter expects total industry sales of about 11.5 million cars and trucks this year. He projects Toyota to track its 2009 market share of 15 percent.