Two of the most trusted and widely-used publishers of used vehicle value guides have said they are devaluing some used Toyota vehicles included in the automaker’s multiple recalls over the last few months.
Kelley Blue Book (KBB) has announced that it is devaluing recalled Toyota models by between 1% and 3%. The publisher said that decreasing consumer demand for the models may result in an over-supply of the vehicles that could result in additional reductions in resale values. The situation may also be exacerbated as dealers receive end-of-lease models.
In a statement KBB said, “A growing inventory of used Toyota vehicles, coupled with a reduction in demand, however slight, only leads to the potential for further devaluation.
According to the National Auto Dealers Association’s Used Car Guide, retail prices on Toyota vehicles has declined by slightly more than 3%, while prices on comparable models from rival automaker, Honda, have seen a modest increase.
In a prepared statement issued today the association said, “NADA’s position is to lower numbers on most Toyota models in the short-term towards the lower range of prices that we have seen in the auctions. If we see significant downward movement in Toyota’s prices next week, it will be incorporated in NADA values since we expect the downward shift to last until the recall issue is completely resolved.”
On Friday, Toyota’s president, Akio Toyoda, apologized for the problems that have left the company in crisis and led to the recall of millions of the automaker’s vehicles in markets worldwide.
“Believe me, Toyota cars are safe,” said the 53-year-old grandson of the company’s founder during a news conference held on Friday at the automaker’s headquarters in Nagoya, Japan.
He went on to offer a personal apology saying, “I would like to take this opportunity to apologize from the bottom of my heart for causing many of our customers concern after the recalls across several models in several regions.”
In recent days, Toyoda has come under increasing criticism for what some have characterized as his lack of leadership and visibility during the current crisis.
That perceived lack of leadership has left some Toyota dealers feeling confused about how to respond to customer’s inquiries about the safety of their vehicles. Although some have reportedly received the shims needed to repair the faulty brake pedals, many are still waiting. In the meantime, they have suspended sales of all affected models until the repairs can be completed. Adding to their anxiety is the specter of additional recalls. This week, the NHTSA announced that it has begun looking into the possibility that the unintended acceleration problems are not due to mechanical defect as claimed by Toyota, but related to the vehicles’ electrical systems.
Investors are also worried. Since announcing the U.S. recall to repair faulty accelerator pedals on January 21, the company’s stock has fallen by about 20% or $30 billion.
Rakuten Investment Management president Kazutaka Oshima places the burden squarely on Akio Toyoda’s shoulders. “Toyoda is responsible for explaining to shareholders since they have lost a significant part of their assets,” he said.
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