NEW YORK: ABC News says Toyota dealers in five states have pulled commercials from local affiliates over qualms about recall coverage. The news organization said an ad agency representing 173 Toyota dealerships told the affiliates last week that it was pulling ads due to “excessive stories on Toyota issues.” The group was said to shift its buys to non-ABC stations “as punishment” for the reports, led by ABC News chief investigative correspondent, Brian Ross.
Ross started covering the issue last November in a series of stories that predicated the recall. The ad agency involved is 22Squared of Atlanta, which handles the accounts for Southeast Toyota that comprises dealerships in Georgia, Alabama, Florida, South and North Carolina. The consortium of dealers accounts for 20 percent of Toyota vehicles sold in the United States.
The car maker is consistently among the top spenders on TV advertising. It ranked 13th among the top local advertisers for the third quarter of 2009, spending more than $27 million, according to the Television Bureau of Advertising. Toyota dealers associations collectively spent nearly $74 million during the quarter, making them the top spot spender. By comparison, Verizon spent nearly $60 million; Ford dealers spent $56.2 million, and AT&T spent $55.6 million. Among the top 25 local spot spenders for 3Q09, 10 were car makers and dealerships.
Toyota has thus far had to recall nearly 9 million vehicles because of sudden acceleration problems. The latest recall involves 437,000 hybrid Prius and Lexus HS250h models, while the National Highway Traffic Safety Administration is investigating complaints about braking and steering problems with 2009 and 2010 Corollas, reports indicate. Toyota officials are scheduled to appear before a Congressional committee in late February to answer for the safety issues and the company’s response.
Toyota’s initial corporate message blamed ill-fitting floor mats. Continued push-back from Toyota drivers who had experienced sudden acceleration moved the company to blame sticky gas pedals. However, the manufacturer of the gas pedal, CTS Corp., is now saying its foot-feed was found to stick only at low speeds, near idle. Safety advocates have pointed to an electronic malfunction, but Toyota contends otherwise.
Class-action lawsuits are coming out of the woodwork in the meantime. Coughlin Stoia Geller Rudman & Robbins LLP of San Diego, Calif., filed one in U.S. District Court for the Central District of California on behalf of shareholders. Toyota’s American Deposit Receipts on the New York Stock Exchange have dropped nearly $9, or 11 percent, year-to-date, but are actually up nearly 3 percent in today’s trading to nearly $75. Bernard M. Gross, p.C. of Philadelphia filed a class-action suit on behalf of shareholders in U.S. District Court for the Central District of California, western Division.
ABC News has a first-hand account of sudden acceleration from Kevin Haggerty of Pittstown, N.J. (See “Toyota Driver: ABC News Videos Helped Save My Life.”) -- Deborah D. McAdams
(Image by DCvision2006
