All Entries Tagged With: "incentives"

Toyota’s Aggressive Sales Incentives – Risk and Reward

Toyota kicked of March with a series of aggressive incentives across the board – zero percent financing, incredibly cheap leases, and free maintenance for many new car buyers. As a result, Toyota enjoyed a 41% year-over-year sales increase in March. In order to keep up that momentum, Toyota has continued many of the incentives they launched in March.

Last week, we talked about how Toyota’s aggressive incentives in March were likely ‘pulling sales forward’, but it’s anyone’s guess as to how many sales were pulled forward and how much was simply pent-up demand. Either way, the fact that Toyota has decided to continue their incentives signals that they feel it’s time to be aggressive and ‘buy’ some business. Here are the risks and rewards that come with this strategy:

Incentives Wake Up Toyota Sales, But at What Cost?

Yesterday Toyota’s March sales numbers came in and they were – in a word – huge. Toyota’s aggressive March sales incentives led to a 44.7% increase year over year, considerably higher than the industry’s impressive monthly gain of 24%. While many analysts have pointed out that Toyota’s 44.7% sales increase isn’t sustainable, that’s not really the point. Of course 40%+ sales increases aren’t sustainable. Here’s the real question: Did Toyota’s decision to get aggressive on incentives kick-start the auto industry, or did they simply pull sales forward?