Prius Sales Accelerate In Japan

The market may have overestimated the effects that Toyota’s 8.5 million global vehicle recall would have on the company’s future sales. In the US, the Japanese car company only sold 10% fewer units in February a year ago.

Toyota’s Prius hybrid outsold all other car brands in Japan last month. The world’s No.1 car company moved 27,000 units of the car off dealer lots. It is the 10th straight month in a row that the Prius was the top-selling car in Toyota’s home market.

Describing consumer sentiment in reaction to Toyota recalls a Japan Automobile Dealers Association spokesman told the AP, “The reaction within Japan has been very calm.”

It is rare that a brand can overcome the sort of defects and bad PR that Toyota has created with its recall trouble, but it is possible. Thirty-one million bottles of Tylenol were recalled in 1982 after some were tampered with. A person who was never captured put poison in capsules sold in the Chicago area. Seven people died. Johnson & Johnson, which made and distributed Tylenol, found that sales bounced back. The company and brand had enough equity with consumers that the damage was limited. The difference between the Tylenol case and Toyota’s is that Johnson & Johnson was never blamed for the incident.

Brand experts believe for the most part that the Toyota recall is so large and that there are so many questions about whether the car company covered up knowledge of the problems that sales could be hurt of months or even longer. The very early numbers from the US and Japan show that the damage may be very limited, which is a sign that years of a reputation for quality and service may trump negative news, even news that is remarkably bad.

Douglas A. McIntyre