FTW: Honda Greatest Beneficiary of Toyota Recall
February 22, 2010 by Colin Bird
Since Toyota’s epic fall from grace, we here at AutoBird have been speculating as to what automaker would gain most from its debacle. Many journalistic outfits assumed that General Motors, Ford and Hyundai would be the big winners. After all, they were the most aggressive in trying to turn Toyota’s suffering into their glory.
It has now been a month since the January 21st recall, and about two weeks since Toyota suspended sales of its most important models, and we have preliminary data that shows Honda being the greatest beneficiary of Toyota’s suffering (graph above).
According to Truecar.com, Toyota lost an astounding 5.4% of retail market share from January 21st to February 15th. Toyota typically commands a 17.5% retail market share, nearly twice as much as its nearest competitor, Honda. According to the study, about 25% of Toyota’s new car shoppers went to Honda and another 25% went to Ford. Hyundai-Kia also picked up another 25%, with Nissan grabbing a solid 10%.
Besides Ford, domestic automakers haven’t gained tremendously from Toyota. In fact, according to this study Chevrolet actually lost market share after Toyota’s recalls. This could be due to vehicle shortages of GM’s best-selling vehicles; the Chevrolet Equinox, Chevrolet Suburban and Cadillac Escalade currently have 11-12 days worth of inventory on lots (60 days worth is considered the norm).
Honda’s success comes as an initial shock for a couple reasons. First, Honda offered no incentives to take advantage of the unraveling of the house of Toyoda. In deference to its Japanese cousin, Honda sent letters to its Acura and Honda dealership’s stating the following: “we will not react in a predatory way toward either Toyota or Toyota customers.” Honda also asked its dealers not to comment on Toyota either.
Second, Honda’s sales have been flagging for more than 12 months now. While Honda has surpassed Chrysler in becoming the fourth largest automaker, there were only 4,907 vehicles separating it and Nissan for the number four spot in January. Aside for the new Honda Crosstour and Acura ZDX, Honda doesn’t have a lot of new product to offer, and that has hurt its sales growth.
Ultimately, the reason for Honda’s recent triumph, now the largest retail brand in America, is that Toyota shoppers often cross shopped Honda , though KBB says that correlation is declining.
Graph and data source: TrueCar.com
Images by: Andrew Walensa
