NASCAR driver Michael Waltrip
Terry Renna  /  AP
NASCAR driver Michael Waltrip, right, watches as his crew works on his Toyota during practice earlier this week. Waltrip’s cheating scandal has dented the automaker’s Daytona debut.
By Roland Jones Business news editor
msnbc.com
updated 2/26/2007 9:33:45 AM ET 2007-02-26T14:33:45

The roar of NASCAR engines at Daytona International Speedway’s famed oval raceway will take on an unfamiliar accent this year.

Japanese automaker Toyota will become the first foreign manufacturer since the 1950s to supply cars for NASCAR’s top series, the Nextel Cup, entering the Camry — America’s best-selling car — and taking on good old American brands like Chevrolet, Ford and Dodge in a distinctively American sport.

Two Camrys made their start in the Budweiser Shootout exhibition race last Saturday and eight Toyota drivers are hoping to compete Sunday in the Daytona 500, which opens the NASCAR season. One of those drivers, Michael Waltrip, had to race his way into NASCAR’s premier event in a qualifying race Thursday after his team’s role in a cheating scandal involving the use of a fuel additive.

Waltrip emphasized Toyota had nothing to do with his team’s actions, but his misconduct is a black eye for the automaker, who’s debut in Daytona is less about winning races than about winning over customers in America’s heartland. Still, while the cheating scandal is significant, it isn’t likely to be a catastrophic event for Toyota according to Bruce Harrison, senior automotive consultant at the consultancy Global Insight.

“Stretching the rules goes back to the very start of NASCAR,” Harrison said. “What does appear to be slightly different to cheating scandals in years passed is the amount of attention NASCAR is placing on this — it seems they are making a very public statement.”

“So I don’t think this will really help Toyota,” he continued. “Spectators are well aware that teams have been penalized for cheating over the years, so this is not going to be a catastrophic event for their entry into NASCAR, but it’s not the way you want to enter the series — it leaves a bad taste in the mouth.”

Toyota’s has enjoyed runaway success in the United States over the past 10 years, based largely on its ability to appeal to white-collar baby boomers with dependable models like the Camry, said Harrison.

Sales of imported brands like Toyota have historically fared best on the coasts rather than in the heartland. To expand its customer base, Toyota needs to win over more working class drivers in the nation’s midsection. NASCAR, Harrison said, is an excellent channel for achieving that aim, as its fans are famously loyal to the vehicle brands of their favorite drivers.

“That’s basically the other 50 percent of the country, and if you haven’t reached them with the approach you’ve been using for years you go out there and take another approach,” Harrison said. “The key here is a desire to connect with a group of consumers that Toyota has missed. And to do this Toyota is pushing its pickups and big SUVs.”

In television coverage of the Budweiser Shootout race there were no commercials for the Camry but numerous spots for the Toyota Tundra pickup truck.

“Previously, when NASCAR fans were out tailgating in the parking lot and discussing which new truck brand to buy, Toyota wasn’t even mentioned,” Harrison said. “With the Toyota brand on the race track, the hope is that now you’ll say Ford, Chevy, Dodge and maybe Toyota. You have the credibility to bring the brand into the conversation, and that is what Toyota is doing by moving into NASCAR. And in my opinion it’s a brilliant move.”

Diana Dejoseph, spokesperson for Toyota Motorsports, the company’s motor racing arm, said a major part of Toyota’s motivation in entering NASCAR this year is to broaden the awareness of its new full-size Tundra truck among NASCAR fans.

“We want to broaden our appeal and brand awareness among NASCAR fans,” she said. “It’s an area of opportunity for us and in terms of truck sales. We are looking to reach out to the center of the country. It’s an opportunity for us to talk about the Tundra.”

The Toyota name has been part of the broader NASCAR conversation for at least the past several years as the Tundra has competed in the NASCAR Craftsman Truck Series, a racing series that features modified pickups, for the last three seasons. Last year, it won the Manufacturer’s Championship and Drive Championship.

Toyota, which launched a new, larger Tundra for 2007, hopes to take market share from rivals like Chevy’s Silverado, the Dodge Ram and Ford’s F-Series.

“Toyota has been involved in NASCAR for years, but they have been very subtle about it, progressing very cautiously,” Harrison said. “They started out in the truck series, and now they are stepping up to the big leagues, so for the spectators they are not coming in out of left field; they’ve seen this coming for a while, and [Toyota] knows it will be relatively well accepted.”

Global Insight expects Toyota to sell 175,000 of the new full-size Tundras this year out of a total U.S. market of 2.295 million full-size pickups, up from 2.272 million units last year. The bulk of the year-over-year increase is expected to come from Tundra sales and from sales of GM’s new GMT900 truck.

Toyota’s entry into NASCAR comes as it is expected to surpass GM this year as the world’s No. 1 automaker, but the company is showing some small signs of weakness. Sales of its popular Prius hybrid sedan were flat in 2006, prompting the company to offer low-interest loans and lease incentives.

Toyota’s NASCAR entry is also expected to spur Chevy, Ford and Dodge into action. Some are concerned that Toyota’s deep pockets will lead it to spend its way to the top, disrupting the sport’s competitive balance. The Japanese firm has reportedly has invested between $100 million and $200 million in NASCAR and recruited top-name drivers to its stock car racing ranks.

There are already reports of talent jumping ship to Toyota’s racing division. The Big Three reportedly are looking at ways to retain top talent.

“Any time there is new team forming there is the potential to jump ship,” said Global Insight’s Harrison. “Essentially, the influx of Toyota’s budget is putting increased pressure on the existing Big Three NASCAR teams, and that is requiring them to go back to the Big Three automakers for additional support and money. So budgets are under scrutiny. I don’t know that any significant new investment is required in these cases, just simply a fine-tuning of the investments these companies have already been making.”

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