Six Months After The Recalls: Toyota Bruised, Lexus Less So?

August 6, 2010
It's been a tough and trying year for Toyota—and Toyota owners.

There had already been a few isolated claims of accelerators sticking. But it was the news of an incident, last August—a family (and off-duty cop) in an ES 350, who sped out of control to a fiery death—that punted Toyota's apparent issue with unintended acceleration into the national spotlight.

By late September, Toyota (NYSE: TM) responded, issuing a safety advisory for mismatched floor mats. As part of a full-fledged recall initiated in November, the automaker announced plans to shorten 3.8 million accelerator pedals and install an override system in cars with push-button ignition. Surprisingly, at this point, sales hadn't hiccupped severely. But they sure did in January, when Toyota announced a second recall, of 2.3 million vehicles, for sticking gas-pedal mechanisms, and lawmakers started following. Overall, with a late-January extension to more than a million more vehicles, a total of 5.1 million vehicles—many different models—are affected in some way by either recall. And by then, some safety-worried shoppers had started crossing Toyota off their lists.

To cut to the chase, since then we've had congressional hearings, some unanswered questions, plenty of apologizing from Toyota, and an automaker with a very bruised reputation.

And then in March Toyota put everything on sale.

Suddenly, with the help of the biggest, most comprehensive incentives program Toyota had ever offered, it managed to boost sales 41 percent versus the previous year, reclaiming the market share that it had lost. The deals were great, including thousands off, as well as two years of free maintenance to those who already owned a Toyota, Lexus, or Scion model.

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