Toyota Tundra Makes Inroads With its Owners
March 09, 2007
Toyota launched the Tundra pickup truck only last month, and so far, based on Edmunds.com’s analysis, it is drawing sales largely from Toyota loyalists rather than stealing sales from General Motors, Ford, Chrysler and Nissan.
Based on February sales data, Edmunds.com puts Toyota’s loyalty rate on the Tundra -- calculated based on what make vehicle was traded in for the Tundra -- at 50 percent, up dramatically from 38.3 percent the month before. That indicates Toyota owners are trading their current Toyotas -- Tundras, largely -- for the new Tundra.
To meet its goal of selling 200,000 Tundras that are built at its new plant in Texas annually, Toyota will have to steal sales from existing truckmakers. Ford and Dodge may be most vulnerable to Toyota’s conquest attempts. The Dodge Ram is the oldest of the full-size pickups on the market. The Ford F-150, America’s best-selling truck for three decades, is just behind it.
Ford’s loyalty rate slipped to 61 percent in February from 65.2 percent; Dodge dipped from 53.2 percent to 49.6 percent. Nissan edged up to 33 percent from 31.5 percent.
The Edmunds.com data shows General Motors owners are extremely loyal to the automaker’s full-size pickup trucks, and their loyalty is climbing. Loyalty rates on the Chevrolet Silverado and GMC Sierra, already the highest in the industry, have been creeping up month by month since the new models were introduced. Chevrolet Silverado buyers in February, who previously owned a GM-branded vehicle rose to 75.6 percent from 71.3 percent; the Sierra to 70.4 percent from 69.3 percent. More specifically, owners of Silverado and Sierra pickups increasingly are trading them for the new versions.
Toyota kicked its largest advertising campaign ever with the NFL Super Bowl; Advertising Age places Tundra advertising spending at more than $100 million, a number Toyota does not dispute. Those ads focus on the Tundra’s hauling and load-carrying capabilities, aspects lacking in previous versions of the Tundra. Toyota also spent more on training dealership personnel on the Tundra than it has on any other vehicle.
More recently, Toyota confirmed some of its dealers are offering as much as a $1,500 discount on the basic work truck Tundra. The discount is a nationwide program running through March in addition to low APR and lease deals previously offered. Other deals vary from dealer to dealer.
Meantime, Ford began advertising its Super Duty heavily during Super Bowl and recently announced a new truck ad campaign featuring Mike Rowe, host of the cable television program, “Dirty Jobs.” Dodge has beefed up advertising. And GM’s pickup truck advertising remains strong since its trucks still are in launch mode.
Posted by Michelle Krebs at 3:04 AM under Analysis , Chrysler , Featured , Ford , GM , Toyota | Comments (2) | digg this | Seed Newsvine
If the rumor is true that Toyota dealers receive a bonus for selling a Tundra to an owner of a Detroit pickup that goes counter to what Toyota has said from the time the new Tundra was announced. The Pres has said from the beginning that they are not intending to take sales away from Detroit rather sell to current owners of Toyota trucks. Pretty slimmy!
Posted by: Nylorac | March 09, 2007 at 9:26 PM
It's also important to keep in mind that many of the enormous discounts advertised by local dealers in print media are "loss leaders" and normally only apply to one or two vehicles. They're the bait used to lure customers into the dealership where they can gaze at all the shiny new metal. Consumers would do well to read the fine print of each ad.
Posted by: Alex Rosten | March 12, 2007 at 8:55 AM