Toyota has the highest loyalty rate of any major automaker, according to a new study – news that suggests the maker might be able to sidestep the impact of another major safety-related recall involving 2.5 million vehicles in the U.S. alone, the largest Toyota has ordered, in fact, since it was forced to repair 14 million vehicles due to unintended acceleration problems in 2009 and ’10.
(For more on the latest Toyota recall, Click Here.)
During the second quarter of this year, Toyota saw its corporate loyalty – a measure of how many owners trade in for the same brand’s newer products – surge to 47.3%. That was up from 41.6% a year earlier and helps explain the dramatic double-digit sales gains the Japanese giant has been reporting during the first nine months of 2012.
“Toyota has done an outstanding job of regaining customer trust and getting repeat customers into showrooms,” said Jeffrey Anderson, director of consulting and analytics for Experian Automotive. “To restore normal operations and regain customer trust in such a short time following the earthquake and tsunami is a truly remarkable comeback.”
Toyota was traditionally one of the top makers in terms of customer loyalty but the numbers tumbled after the embarrassing 2009 – 2010 unintended acceleration crisis which, along with other safety-related issues, led it to recall a record number of vehicles while also facing substantial fines from the U.S. government – while senior company leaders including President Akio Toyoda were chastised during hearings on Capitol Hill.
A year later, Toyota’s global production network was crippled by the Japanese earthquake of March 2011 that nearly shut down the island nation’s entire automotive industry. This year, however, Toyota has come roaring back. In September alone its sales surged 45.1%, much of that driven by loyal owners returning to the market.
Toyota surged past Detroit rivals General Motors and Ford, which led the loyalty chart during the second quarter of 2011. GM remained second for the latest quarter with an overall loyalty rate of 46.2%, followed by Ford at 46.0%, Hyundai at 45.3% and Honda at 43.1%.
“It makes me choke up,” said Toyota spokesman Brian Lyons. “I can tell you from personal experience that customer loyalty through this period has been phenomenal.”
Driven by returning customers – and with its factories back up to full speed, Toyota also posted the biggest sales gain during the quarter, new registrations up 145,000. Chrysler followed with 83,000 new registrations.
Whether loyalty alone can get Toyota past the latest recall crisis – with 7.5 million vehicles being recalled worldwide, a third of those in the U.S. – is uncertain, however.
“Toyota has a very loyal owner base, and this (latest recall) isn’t going to sway them,” says analyst Rebecca Lindland, of IHS Automotive. “But for those people on the fence about buying a Toyota, this will have an impact. It could be more difficult getting new buyers into the showroom.”
In other findings, the new Experian study listed the Chevrolet Sonic as the individual model with the single largest loyalty rate, at 60.1%. Four Ford vehicles followed closely behind, however, the Fusion at 59.9%, the Flex at 55.0%, the Edge at 54.0%, and the Five Hundred at 52.0%.
Experian analysts also noted that the age of the average American vehicle in use during the second quarter rose to a record 10.8 years, up from 10.6 years during the same quarter of 2011.
Absolutely on the loyalty. I doubt I’ll get this printed as it seems this web site ONLY prints articles that think the only good cars out there are GM, Ford and Chrysler product.
If it wasn’t for trucks their car sales would be in big trouble. Whoops, I’m not suppost to say that. Sorry..
You keep saying that, IS, but a read-through of our archives would suggest anything but. I’ve been covering this business for 33 years…I personally celebrate the start of my 34th year this month…and I can give you some references in Detroit that would seriously disagree with you. The fact that we are holding the corp. feet of Honda and Toyota to the fire for recent mistakes is valid and no different than we…or I…have done over the years. Follow our coverage of Ford’s quality issues, for an example of how we try to treat all makers equally. Perhaps the fact that we don’t simply offer blind faith to import brands colors you own perception?
Paul A. Eisenstein
Publisher, TheDetroitBureau.com
PS: See Hobo Rat’s comments about Honda in the comment section of our story on Honda’s potential problems earlier this week.