Toyota's U.S. Auto Sales Drop 31.4% in August

Company is suffering from its numerous recalls

Toyota said on Sept. 1 that its U.S. auto sales fell 31.4% in August compared with a year earlier, when the Japanese automaker's sales were boosted by a government-funded incentive program.

"While August results trailed year ago levels when the CARS program generated significant incremental sales for the brand, we're pleased with how the month shaped up," said Don Esmond, senior vice president of automotive operations for Toyota Motor Sales USA. He was referring to the government's Car Allowance Rebate System, run by the U.S. Department of Transportation.

Since the program ended the Japanese carmaker said "customer loyalty rates have returned to traditional levels as Toyota continues to lead the industry as the number one retail brand year-to-date."

August sales fell to 148,388 vehicles, a 34% drop, not adjusting for the fact that there was one less selling day this year.

Toyota's sales for the year-to-date are essentially flat at 1.16 million vehicles compared with 1.17 million in the first eight months of 2009 even as its competitors have shown solid growth compared with last year's depressed levels.

The automaker has seen its once-stellar reputation damaged by a series of mass safety recalls which sparked federal investigations, congressional hearings and undermined consumer confidence.

"Toyota was expected to report a big year over year decline because it was one of the biggest beneficiaries of Cash for Clunkers last, but this month's results are even worse than expected," said From Michelle Krebs, an analyst at the automotive website Edmunds.com.

"Toyota still is suffering a hangover from its numerous recalls this year. It is taking a long time for Toyota to get back to 'business as usual.'"

Sales at Toyota's luxury Lexus brand were down 11.6% in August at 19,465 but were up 11.2% for the year to date at 145,490 vehicles. The division saw sales fall 33.7% in August to 128,923 whiles division sales were down 1.5% for the year-to-date at 1.04 million.

Copyright Agence France-Presse, 2010

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