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Toyota to Terminate Republic Ownership of Arizona Dealer

30 June 1997

Toyota to Terminate Republic Ownership of Arizona Dealer

    TORRANCE, Calif., June 30 -- Toyota Motor Sales, U.S.A.
(TMS), Inc. today announced that it is taking legal action to terminate any
ownership interest of Republic Industries, Inc. in Tempe Toyota, located in
Tempe, Arizona.
    In a notice of intention to terminate filed with the Arizona Department of
Transportation, TMS states that termination of the franchise is warranted
because Republic has violated the requirements of Arizona law, as well as
disregarded Toyota's rights and policies.
    "Republic knows full well that Toyota has the right to review and approve
the sale or transfer of the company's dealer franchises," said TMS Senior Vice
President Jim Press.  "In flagrant disregard of these rights and of our
company policies on multiple-dealer ownership, Republic went behind our back
and closed the acquisition of Tempe Toyota, without our prior approval.
Republic's `take it or leave it' approach has given us no alternative but to
`leave it'."
   Toyota has offered to withdraw the termination if Republic unwinds the
transfer by reinstating the previous owner Mitchell D. Pierce and The Pierce
Corporation.
    "While we don't expect our legal action to cause any interruption in the
operation of Tempe Toyota in the near-term, we want to do whatever we can to
protect our customers in the local area," said Press.  "For that reason,
Toyota is prepared to have Mr. Pierce resume ownership of Tempe Toyota.  We
encourage Republic to make that decision sooner rather than later."
    Concerned about the potential harm to customers, dealers and its own
business interests from a rapid acquisition of a large number of dealers by a
single enterprise, Toyota adopted multiple-dealer ownership policies that
limit the number of dealers that can be commonly owned.  These policies,
adopted last year, also require a nine-month waiting period between dealer
acquisitions.
    "Toyota's policies are prudent and reasonable to protect against the
uncertainties and risks associated with a rapid consolidation of ownership,"
said Press.  "All of the publicly-owned dealer groups that have acquired
Toyota and Lexus dealerships have agreed to our policies -- except Republic.
Considering Republic's plans to acquire as many as 59 Toyota dealerships --
which could represent up to 20 percent of Toyota's annual sales volume in the
U.S. -- and to control the top 50 auto markets, our concerns are clearly well-
founded."
    Press said that Toyota intends to do whatever it can to protect the
interests of its customers and dealers from the dangers of rapid, multiple
dealership acquisitions by a single enterprise.  To that end, the company has
taken legal action in Texas and Arizona, with further action in other states
under consideration.

SOURCE  Toyota Motor Sales, U.S.A. Inc.