Toyota to Spend $1 Billion on U.S. Marketing in Fourth Quarter

Regional Dealer Ad Groups to Get Significant Boost

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DETROIT ( -- Toyota Motor Sales USA will spend $1 billion in the U.S. for the fourth quarter across its Toyota, Scion and Lexus brands, the automaker's top brass told dealers in Las Vegas this week.

The amount includes incentives to car buyers and a boost to regional dealer ad groups, in addition to consumer advertising, which will be heavy on TV, a spokesman at the automaker said. He declined to give the specific split by brand or medium.

Toyota, Scion and Lexus combined spent almost $800 million on incentives in the final quarter of 2008, according to

The world's top automaker spent $266 million in U.S. measured media across its three vehicle brands in the fourth quarter of 2008, according to TNS Media Intelligence, which does not account for incentives. For the first half of this year, Toyota spent $402 million in U.S. measured media (minus online spending) across its three vehicle brands, a 17% drop from the same year-ago period, according to TNS.

According to the spokesman, most of the new ads will start arriving Oct. 1, although some may break a few days earlier. The ToyotaThon and Lexus Golden Opportunity year-end sales' events are also part of the big-ticket expenditure, he said.

Core models will get the most backing, he said, including the Toyota Camry car line, Toyota Prius hybrid and Toyota RAV4 small SUV.

Dennis Lauzon, a Toyota dealer in Englewood Cliffs, N.J., who attended the meeting, said the automaker will significantly boost its co-op contributions to regional dealer ad groups.

The Toyota spokesman said the carmaker is increasing its contribution to half of what the dealer groups spend, though he did not know the prior percentage.

Toyota's regional boost will be welcome news to local TV and radio broadcasters, which have suffered from dramatic cuts in auto ad revenue during the car industry's worst sales year in decades.

Mr. Lauzon credited Toyota's new leadership for the move. He said the presentation in Vegas was made by Akio Toyoda, the grandson of the carmaker's founder, who was tapped as president of Japanese parent Toyota Motor Corp. early this year; Yoshimi Inaba, who came out of retirement in June and was named chairman-CEO of Toyota Motor Sales USA; and Jim Lentz, president-chief operating officer of Toyota Motor Sales USA. "These guys get it," Mr. Lauzon said.

Like the rest of automakers doing business in the U.S., Toyota has seen its new-vehicle sales slide this year. The company's three brands sold 1.17 million new vehicles in the first nine months of 2009, a 29% drop from the year-ago period and slightly higher than the overall average industry decline of 27%, according to Automotive News.

Toyota Motor will have about the same sales volume, roughly 140,000 units, for its three brands per month in October, November and December as it did in those months last year, a spokesman at Edmunds predicted.

The automaker's average incentive per vehicle across its three brands was $1,628 last month, lower than the industry average of $2,474, according to auto site Still, Toyota Motor's August incentives were higher than its July average of $1,310 on each model and $1,534 per unit in August 2008, said Edmunds.

Publicis Groupe's Saatchi & Saatchi Los Angeles, Torrance, Calif., handles the Toyota brand, while its sibling, Team One, El Segundo, has Lexus. Dentsu America's Attik, San Francisco, has Scion. Publicis' Zenith Media USA handles media.

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