Share “Toyota boosts US sales with rental cars”

Toyota boosts US sales with rental cars

Associated Press Modified: February 14, 2012 at 4:30 pm •  Published: February 14, 2012

DETROIT (AP) — Toyota's strong start to 2012 got a boost from a market it has long avoided: rental-car companies.

The Japanese automaker sold 47 percent more cars and trucks to U.S. rental companies and other fleets in January, compared with a year earlier. Without those corporate customers, U.S. sales would have been up less than 1 percent instead of 7.5 percent.

The sharp increase in fleet sales is unusual for Toyota, which has long shied away from that market because it's less profitable than sales to individuals. Rental-car sales, in particular, can hurt a brand's image and lower resale values, because they flood the market with models. Ninety-three percent of Toyota's January fleet sales went to rental-car companies. The rest went to corporate customers.

Toyota says the higher fleet sales won't be a long-term trend. It says it's making up for contracts it couldn't fulfill last year after Japan's earthquake limited car production.

Still, the carmaker is under pressure to perform better. Sales have fallen the past two years because of safety recalls and earthquake-related shortages. Toyota ended 2011 with a 12.9 percent share of the U.S. car market, down from 17.9 percent in 2009. And even with fleet sales, the company's January sales increase of nearly 8 percent lagged the overall industry, which gained 11 percent in the U.S.

Toyota's numbers don't show which vehicles went to rental companies, but two aging models — the Toyota Yaris subcompact and Toyota Avalon sedan — saw huge sales increases. That's often a sign that cars are being sold to fleets.

In a recent interview with The Associated Press, Toyota Motor Corp.'s U.S. sales chief Bob Carter said the company sold few cars to fleets in the second half of 2011 because inventories were so low.

That has changed since Toyota got its factories working and ramped up production following the earthquake.

Continue reading this story on the...