GM offers $1,000 incentive to Toyota owners

by Peter Valdes-Dapena, senior writer January 27, 2010: 4:50 PM ET


NEW YORK (CNNMoney.com) -- General Motors is offering incentives of $1,000 and low financing rates specifically for Toyota customers worried about their recalled vehicles, beginning Wednesday.

"We decided to make this offer after receiving many e-mails and calls from our dealers, who have been approached by Toyota customers asking for help," GM said in a statement. The offers will run through the end of February.

GM is offering $1,000 rebates or up to $1,000 to help pay off current leases on Toyota products. The automaker is also offering 0% financing on most models for Toyota customers. The offers apply to 2009 and 2010 model year cars.

Such "conquest incentives" -- incentives targeted at owners of other manufacturers' vehicles -- are common in the industry, GM spokesman Tom Henderson said.

In this case, however, the incentives are designed to take advantage of Toyota owner's worries at a time when they're concerned about the safety and quality of their cars.

Toyota announced last week that it was recalling 2.3 million cars, SUVs and trucks for a problem with a potentially sticky gas pedal. This was after the company recalled 4.2 million vehicles -- many of them the same as last week's recall -- for a problem in which the gas pedal could become stuck on the floormat.

Toyota recently announced that will temporarily stop selling models affected by the most recent recall, including some of their most popular products like the Camry sedan and the Rav4 small SUV.

The problem plays to GM's current strengths, said James Bell, an analyst with Kelley Blue Book's KBB.com. Some of GM's strongest products, like the Chevrolet Malibu sedan and Chevrolet Equinox SUV, are strong competitors to products Toyota is now not selling.

"The Equinox is the obvious buy over a Rav4," he said.

If the Chevrolet dealers were still selling last year's Equinox, before the new, completely redesigned model was introduced, GM's position wouldn't have been as strong, he said.

Because the Pontiac Vibe is built on the same line as the Toyota Matrix in Fremont, California at the joint GM/Toyota NUMMI plant, GM is getting pulled into fray for problems with Toyota's accelerator pedal system.

GM confirmed to AOL Autos this morning that they would halt sales of the Pontiac Vibe immediately. However, since GM announced the wind-down of the Pontiac brand last year, the company doesn't have many on sale. In fact, the number is less than a dozen.

Models Included In Toyota and GM's Recall / Suspension:
2009-2010 RAV4
2009-2010 Corolla
2009-2010 Matrix
2005-2010 Avalon
2007-2010 Camry
2010 Highlander
2008-2010 Sequoia
2007-2010 Tundra
2009-2010 Pontiac Vibe

No Lexus Division or Scion vehicles are affected by these actions. Also not affected are Toyota Prius, Tacoma, Sienna, Venza, Solara, Yaris, 4Runner, FJ Cruiser, Land Cruiser and select Camry models, including all Camry hybrids, which will remain for sale.
"We are in the process of stopping sale of remaining Vibe models on dealer lots," Adler said. "We are aware of six units of these in the United States."

When asked if the suspension of sales would impact used vehicles sitting on lots (the recall includes Vibe models from years 2009 and 2010), GM spokesperson Alan Adler said the company is reviewing that option at this time but has not made an announcement.

Adler said that GM is waiting for Toyota to provide more information on the recall but that they would begin communications to their owners soon. Owners may contact Pontiac at 1-800-620-7668 or at the owner center at www.GMownercenter.com.