TORONTO — Toyota’s recall problems may have finally caught up with the automaker in April, as the automaker’s sales fell 16.7 compared with a year ago, after two months of double-digit sales gains.
Toyota Canada Inc. sold 16,303 Toyota models and 1,370 Lexus luxury vehicles in April. That compared with 19,599 Toyotas and 1,621 Lexus vehicles in April 2009.
The drop came as overall light vehicle sales in Canada reported Monday were up four per cent from last April, according to figures compiled by DesRosiers Automotive Consultants.
Auto industry analyst Dennis DesRosiers said the results point to evidence that the auto industry in Canada is being segmented into “a ’have’ versus ’have-not’ type of market.”
He said that the underperformance of companies like Toyota and General Motors, which saw a 20.4 per cent drop compared with a year ago, is helping drive the success of the “have” companies, like Ford and Hyundai, which reported 24.7 per cent and 15.6 per cent gains respectively.
“When you have three of the six largest companies in the industry in difficulty it leaves a lot of room for others to do well.”
Toyota has been fighting to regain its once-sterling reputation for quality after recalling more than eight million vehicles around the world due to acceleration problems in multiple models and braking shortcomings in the Prius.
“It didn’t (catch up with them) the first couple months into the problem likely because of pre-booked sales but now that buyers that were in the system have been cleared out there are a lot fewer buyers coming into their show rooms,” DesRosiers said.
“Clearly their heavy discount strategy didn’t work in turning around sales performance. It may have saved them from a worse month but didn’t save them from a bad month.”
General Motors of Canada, which just edged out Ford to sell the most cars and light trucks in Canada for April, said that excluding brands the company is phasing out or selling, Canadian sales actually improved.
The automaker has scaled back to just four core brands as part of its restructuring plan: Chevrolet, Buick, Cadillac and GMC. The company is either selling or winding down its other iconic brands, including Pontiac, Saturn, Hummer and Saab.
“Our April sales results show continued progress towards our growth plan, as this is the fifth consecutive month we’ve increased retail sales of our core brands,” said Marc Comeau, GM’s vice-president of sales and marketing.
Honda, and its luxury brand Acura, also underperformed the rest of the market last month, with April sales down 1.5 per cent and year-to-date sales up 5.8 per cent in a market that is reporting double digit growth.
DesRosiers said the brand’s reluctance to “play the heavy discount game” has hurt their sales performance.
Meanwhile, Chrysler Canada said its soaring April sales are evidence the automaker is rebounding from the depths of last year’s downturn, when it filed for bankruptcy and was forced to restructure using government bailout money.
Chrysler Canada reported a 35 per cent jump in sales last month and Ford Canada saw its sales rise 24.5 per cent compared with last year.
“No question 2009 was a difficult year for Detroit — heck, even the Red Wings struggled — but this year is different,” Reid Bigland, president and CEO of Chrysler Canada, said in a statement Monday.
Chrysler Canada said its April sales jumped 35 per cent to 20,630 vehicles, up from 15,311 in the same month last year and the highest level since June 2008.
Ford Motor Company of Canada, Ltd. — the only one of the so-called Detroit Three to avoid filing for bankruptcy and a government bailout — said it sold 23,441 vehicles in April, compared with 18,828 in April 2009. Truck sales were up 27.5 per cent and car sales rose by about 14.4 per cent.
Hyundai said it sold a record-breaking 12,495 vehicles in April, up 15.6 per cent from the same month last year and shattering the company’s previous record of 11,200 units sold in May 2009.
Automakers also reported their April sales results from the U.S. Monday, where the industry stayed on the road to recovery in April after last year’s dismal numbers, with most major automakers seeing double-digit sales gains.
But sales were down from March, when Toyota launched record-high incentives to lure buyers after a series of safety recalls.