Toyota mulls incentives to patch its reputation

NEW YORK (CNNMoney.com) -- Toyota is considering new incentives aimed at reviving sales as the troubled automaker works to repair its reputation following a spate of high-profile recalls.

"Toyota is reviewing all incentive options in consideration of current competitive market conditions and support of our dealers nationally," said Toyota spokeswoman Celeste Migliore.

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I still heart my Prius

Toyota Prius owners are standing by the carmaker after it announces faulty braking systems in its 2010 hybrid.

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Migliore said the company did not have any additional information about the incentives. But reports published Monday said Toyota is considering, among other things, increasing the cash bonus it gives to repeat customers and extending its warranty program.

"They're looking at a number of opportunities," John McEleney, chairman of the National Automobile Dealers Association, said from the group's annual meeting in Orlando, Fla. "Whether it's relative to maintenance, warranties or incentives -- nothing is finalized yet," he said.

McEleney, who was in a meeting with over 100 dealers and Toyota executives Monday, said the automaker has already fixed about half a million vehicles with sticky accelerator pedals and that the recall efforts are "progressing well."

A spokesman for AutoNation, the nation's largest auto retailer, said the company fully supports "any combination" of the incentives under consideration.

"They need to develop some type of program to bring American consumers back in," said Marc Cannon, an AutoNation senior vice president. "But American consumers are very forgiving. And if Toyota can jumpstart sales, we think they will come back."

Cannon said incentives are expected to roll out some time in March.

Any moves would come as Toyota struggles to restore its once-stellar reputation amid a vast recall of its vehicles for problems with sticking brake pedals, software glitches and faulty floormats.

The widely publicized recalls have taken a toll on sales. Earlier this month, Toyota said January sales fell 16% from a year earlier, worse than a forecast of a 12% year-over-year decline from sales tracker Edmunds.com.

The latest blow to Toyota's image came over the weekend when the company recalled 8,000 four-wheel Tacoma trucks in North America, citing potential production defects in the front-drive shaft of certain 2010 models.

That followed a recall issued last week of more than 400,000 hybrid vehicles, most of them its vaunted Prius, for braking problems.

In addition, two separate problems involving gas pedals spurred Toyota to recall some 8.1 million vehicles worldwide since last November, costing the company an estimated $2 billion in repair costs and lost sales.

Meanwhile, Toyota has been on a public relations blitz as company executives prepare to go before Congress next week to answer questions about the company's safety record.

Toyota now has an appointment Feb. 24 before the House Oversight Committee. The panel plans to question the company's president of North America operations, Yoshimi Inaba, about problems with both the gas pedal and the Prius brakes.

The company is also scheduled to go before the House Energy and Commerce Committee on Feb. 25 and the Senate Commerce Committee on March 2.

Lawmakers are expected to investigate discrepancies between what Toyota's U.S. sales chief, James Lentz, told the committee last month about sticking gas pedals and what he subsequently said during a television interview.

The president of the troubled carmaker will testify before Congressional committees if required, Japan's Kyodo News Agency reported.

Last week, Toyota President Akio Toyoda issued an apology and said the company will work to recover its customers' trust. "Quality is our lifeline for Toyota," he said.

-- CNNMoney.com senior writer Jennifer Liberto contributed to this report.