Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Toyota exec: No quick fix to brand damage

By Chris Isidore, senior writer

NEW YORK (CNNMoney.com) -- The head of Toyota Motor's U.S. operations said that the company is making good progress repairing recalled vehicles, but that fixing the damage done to the automaker's image will be a tougher process.

Speaking in New York on Tuesday, Jim Lentz, president and chief operating officer of Toyota Motor Sales U.S.A., told reporters he's confident that loyal Toyota customers are returning to the brand, given what he projected will be a 35% jump in sales in March. But attracting owners of other auto brands to again consider Toyota will be a more difficult process.

When will you drive an all-electric car?
  • As soon as they become available
  • After they've been out awhile
  • Never

"I think it's a matter of time," he said. "They're going to come back. I can't tell you when. It's not going to be weeks. It's going to be measured in months, hopefully not years."

During a forum sponsored by the National Automobile Dealers Association and research firm IHS Global Insight, Lentz acknowledged that Toyota (TM) had taken its formerly pristine reputation for granted before the recall crisis.

"We were so confident that quality, dependability and reliability were so set in stone that we lost some focus on it. We're paying the price for that," he said.

Other experts at the conference said they agreed that Toyota would eventually put its recall problems behind it, but that it might never again enjoy the steady gains in U.S. market share that had driven its growth for several decades.

"Those who are predicting that Toyota has permanently lost a major chunk of market share are wrong," said Mike Jackson, president of AutoNation (AN, Fortune 500), the nation's largest dealership network. "However what has happened with this whole thing is their march toward 20% [U.S. market] share has ended."

Toyota had 17% of the U.S. market in 2009, but its share tumbled to 13.4% in the first two months of 2010 in the midst of the recall problems.

Even the 35% jump in sales forecast by Lentz might not be enough to lift the automaker back to 2009 share levels, since industrywide sales are forecast to be up more than 30% when automakers report results Thursday.

Chrysler still set to break even in 2010. Also speaking at the conference was Sergio Marchionne, CEO of both Italian automaker Fiat and U.S. automaker Chrysler Group, in which Fiat acquired a controlling stake a year ago during the bankruptcy process.

Marchionne, whose remarks were briefly interrupted by protesters criticizing the federal bailout of the automaker a year ago, said he basically agreed that it was important that troubled companies be allowed to fail. But he said allowing a company the size of Chrysler to go into liquidation in the midst of broader problems in the economy and credit markets would have had a devastating effect on the rest of the auto industry and the U.S. economy.

He said that despite doubts about the company's business plan, he's confident that the combination of Chrysler and Fiat will allow both companies to survive. He said the company ended 2009 with a cash balance of more than $5 billion, that it is spending less money than projected in its business plan and he's confident Chrysler will meet its target of breaking even in 2010.

He added that he's more confident about Chrysler's prospects than he was in June of 2009 when he assumed control of the company.

"To the extent that I'm producing cash and reinvesting in the product portfolio, then I feel a lot more comfortable," he said. To top of page

Index Last Change % Change
Dow 17,813.39 1.20 0.01%
Nasdaq 5,116.14 13.33 0.26%
S&P 500 2,088.87 -0.27 -0.01%
Treasuries 2.23 -0.01 -0.49%
Data as of 8:03pm ET
Company Price Change % Change
Pfizer Inc 32.87 0.90 2.82%
HP Inc 12.64 -2.00 -13.66%
General Electric Co 30.36 -0.30 -0.98%
Bank of America Corp... 17.44 -0.03 -0.17%
Freeport-McMoRan Inc... 8.10 -0.20 -2.41%
Data as of 4:02pm ET


Brazilian police arrested a prominent senator and billionaire CEO for interfering in the investigation of Petrobras, which has pushed Brazil into recession. More

Watsi crowdfunds donations to cover healthcare costs of those in need. And it's seeing a surprising trend: micro-donations via the popular Chinese social networking app, WeChat. More

Some of the coolest toys this year are from small businesses. Here are 10 hot toys that just might be a smash hit this holiday season. More

American consumers saved more in October compared to a year ago -- a sign of a behavioral shift in consumer spending. More