Zero Percent Financing: Toyota Joins The Crowd
It used to be that finding and purchasing any new Toyota model for less than the sticker price was a difficult proposition. Like Honda, Toyotas have long been considered 
one of the benchmark brands by which most others are measured. Clearly, this holds true for today, but there is one problem: Toyota is having difficulty moving their inventory.
A First For Toyota
Beginning immediately and running through November 3rd, Toyota is making the unprecedented move to slap 0% financing on eleven of its models. Like every other manufacturer, Toyota was hammered in September by a huge drop off in sales, a decrease of 32.3%, one of the sharpest losses of the Big 6 automakers (ie, GM, Toyota, Ford, Honda, Chrysler, and Nissan). Most of these losses can be attributed to the virtual collapse of the credit industry as the federal government wrestles with what is now a gargantuan $850 billion dollar bail out bill.
Due to the dry up of the credit industry, cash rich Toyota is tapping its own financing arm to offer special interest free financing on select models for terms ranging from 36 to 60 months. These eleven models include the Camry, Corolla, Matrix, Tundra, FJ Cruiser, 4Runner, Highlander, Sequoia, Sienna, RAV4 and Tacoma. Noticeably absent is the Yaris and hybrid Prius as well as any models from Scion and Lexus.
GM, Others Offer Incentives Too
Other automakers have already announced their inventory clearing incentives including General Motors which replaced its successful “employee pricing” plan with a zero percent financing or cash back program of its own. The company is offering $2000 bonus cash on the 2008 Buick Lucerne, $5000 bonus cash on its big pick up trucks and 0% APR for 72 months on the Chevrolet Tahoe, among other offers.
For consumers who have plenty of cash on hand, shopping for a new car between now and the end of the year can save you thousands of dollars. Expect that a Toyota dealer will lower their sticker price for customers who don’t want financing and who choose to pay cash. With the market is such bad shape, clearly the consumer with excellent credit and/or cash in hand can call the shots and ensure themselves of securing the best deal on their new vehicle.
In the coming weeks, I’ll post a feature covering all of the incentives being offered, particularly the year end deals which tend to crop up right after Thanksgiving. With September 2008 domestic sales falling below one million units, automakers are scrambling for ways to get you into a new car. Of course, the current financial climate will play have a strong impact on whether you buy now or put your purchase on hold, a decision you’ll make based upon your personal confidence in the market.
Comments
4 Comments on Zero Percent Financing: Toyota Joins The Crowd
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Tundra Headquarters on
Wed, 8th Oct 2008 1:08 pm
It’s exciting to see Toyota attack the market so profoundly by offering 0 percent financing in this climate. It’s a smart way to increase market share and boost sales. However, it’s hard to understand why Toyota has all but surrendered the half-ton truck market to the domestics. Recent comments about “not getting in the truck wars” seem to conflict with the decision to offer 0 percent financing nearly across the board. Does anyone else sense that Toyota is suffering from a bureaucratic crisis?
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