Benefiting From Toyota’s Misfortune

Feb 22, 2010

It’s no secret that Toyota is having major issues with its vehicles as of late.  Business Week is examining ways in which American automakers can use the recent recalls to their advantage.

With Toyota’s reputation now muddied, American automakers are poised to inherit its customers.  The trick, according to analysts, is to draw business to their side without seeming predatory in doing so. “Disparagement or gloating,” GM marketing chief Robert Lutz wrote in an e-mail, “will only trigger a sympathy backlash in favor of Toyota.”

Detroit doesn’t have a whole lot to brag about right now, but new developments could change the game in the near future.  The Chevy Volt, set to debut this fall, is four times as fuel-efficient as the 2010 Prius and will produce enough units after 2012 to take a large bite out of Toyota’s share of the hybrid market.  Ford’s recent focus on smaller, sportier cars such as the Fiesta and Focus also threatens to pull some of Toyota’s younger, less loyal customer base away.

However, the Detroit automakers are not the only ones looking to capitalize on Toyota’s problems.  Honda, Nissan, Kia, Hyundai and others could also gain market share when all is said and done. Whatever the case, Detroit’s window of opportunity won’t stay open for long. “If you’re going to grab market share from Toyota,” says Consumer Reports, “you have to do it in the next nine months.”

 To read the full article, head over to Business Week.

Photo courtesy of cliff1066 under the Creative Commons License.