Toyota's Loss is U.S. Carmakers' Gain

(CBS)  Toyota is facing yet another recall of popular vehicle over safety issues. This time, it's Toyota Corollas - one of the company's best-selling models - that can have dangerous problems with the power steering system at high speeds. And that's on top of 8.5 million other cars and trucks that have already been recalled for sometimes-deadly issues.

But while Toyota dealers have been working around the clock to repair the recalled cars, the competition has been busy as well - ringing up sales, as CBS News correspondent Nancy Cordes reports.

Domestic auto dealers across the country say Toyota's loss has been their gain.

"Since it's been announced, every day has been good here on the lot," said Dave Vorcheimer of Maplecrest Ford in Union, N.J.

In Sun Prairie, Wisc., auto dealer A.J. Stark talked up the "extra incentives out there for people who want to take advantage of the situation."

And in Des Moines, Iowa, Scott Politte of Stivers Ford said simply, "It's been a great opportunity for Ford."

How great? Ford's January sales were up 25 percent from last year. GM's sales rose 14 percent and Nissan sales were up 16 percent year-over-year.

Toyota plunged nearly 16 percent.

Chrysler is offering a $1,000 incentive to owners who trade in certain recalled Toyota models for new Chryslers, Dodges or Jeeps. GM, Hyundai, and Ford have similar $1,000 deals.

"It's a wide open field for brands to capture new customers," said Ford executive vice president Mark Fields.

Crisis management expert Gene Grabowski says Toyota's early communication strategy didn't help.

"I think there was a concern for secrecy and privacy and I think that was probably as much of a cultural difference between Japan and the U.S. and North America as anything else," he said.

Toyota's new strategy, he says, is a step in the right direction.

"In recent days, our company hasn't been living up to the standards that you've come to expect from us," the company said in a television ad that first aired during the Super Bowl.

So how long will it take Toyota to recover from this?

"Sometimes companies with the resources of a Toyota can turn things around and bounce back in six months to a year," Grabowski said. "Sometimes even a little less."

But for now, Toyota's problems are a welcome boost for U.S. carmakers who've just been through their own corporate crises.

[LarryRossdale]

I've never had a problem with my Toyota Camry. I got mine from <a href="http://www.1800autoland.com/">NJ Toyota</a> and absolutely love it. Check out their website at http://www.1800autoland.com/

[tryhonesty]

Get off the political BS. Toyota is NOT going away. It IS the benchmark in manufacturing (research TPS on google for those misinformed or under educated). To the domestic automakers, enjoy while it last (by the way, hope your auto has a resale value in the future, and get a good mechanic on standby). Most of us would not have left the likes of GM, Chrysler and Ford if they stood behind their cars AFTER the sale. My Toyotas and Hondas are the best, I will put them against any make or model regardless of cost! Funny how you do not see the detroit iron in the fastest racing cars in the world of Indy Car or Formula 1???

[kyleminli]

Will the bleeding ever stop? Toyota's slogan used to be "Oh what a feeling!" Odd to think of saying that when you're flying down the road in an uncontrolled vehicle: one that accelerates without cause (Camry et al), one with poor breaking (Prius), or one that will steer itself into another lane (Corolla). Toyota is toy-otally out of control!

[ajvw]

I'll just keep driving my 1992 BMW.

[underdogus2009]

It's a Goverment scam folks don't buy American autos...

[nuffera]

Still would never buy an american made car. Honda!!!!!!!!!!

[wdh3007]

This is only one person's opinion but my guess is this was all to help GM or what is now Government Motors since the govt under Obummer now controls the car industry much like everything else. What do you do to eliminate your competition have a recall on the largest foreign automaker.

[bankersvox]

do you think ?

[mikemikedude]

No offense but I can't believe anyone is crazy enough to buy a new car right now in this economy. Considering that a healthy chunk of 2010 Cash 4 Clunkers cars have already been repossessed (i.e. repofinder.com) why not just go to local banks and credit unions and buy these repo cars back for half the retail price? If you're going to buy junk at least don't over pay.

[CBSisCommunist5]

good idea-buy used. Many people are hurting and need cash.

[rwsmith29456]

This is a message that US carmakers can slack off in quality again. At least that's how they'll probably take it.

[usnjake]

rwsmith: "This is a message that US carmakers can slack off in quality again. At least that's how they'll probably take it."

I think not. Ford's quality ratings have been going up for years, rivaling if not surpassing Toyota. I have always throught Toyota's superior quality ratings was a big myth.

I've owned one Toyota, and it was a big lemon. Never again! All of my otehr cars were Fords and I've loved them!

To think that the Big Three is (or will) operating on the idea of business as usual is preposterous. American cars have been getting better and better. My current car is 15 years old and looks (and runs)almost as good now as it did the day it came off the floor!

This mess Toyota is experiencing is one of their own making.