Posted: Feb 8, 2010 at 6:05 AM [Feb 8, 2010]
Getting to the top of your game or industry is never easy. It takes vision, dedication, competitive drive, talent and some luck. However, it doesn't take long for a champion to get knocked off the podium.
Toyota, it seems, is having its own Tiger Woods moment. Tiger's reputation was permanently tarnished when his perpetual infidelities were revealed.
Now, Toyota's quality indiscretions are coming to light -- and the public is beginning to question whether the automaker's reputation for quality was ever deserved.
Toyota - known for low-cost manufacturing systems, reliable
vehicles, best hybrid technology and loyal customers - had reached the
zenith as the world’s largest producer of vehicles.
Suddenly, Toyota’s quality problems and bungled crisis management are threatening to reorder the world rankings of automotive companies.
So why all the fuss about Toyota’s quality problems? I think there are several reasons:
1. Scale and market position.
Audi was struck with sudden acceleration problems in the 1980s, nearly wiping Audi out of the market. Together with its parent, Volkswagen, Audi had less than 2 percent of the U.S. market, yet the problems and various news reports nearly killed off Audi in the U.S.
But Toyota sells about 16 percent to 17 percent of all new vehicles,
according to Ward’s Automotive. The pedal recall affects 5 million
Toyotas already on the road. That’s equivalent to about three years of
the company’s U.S. sales.
2. Culture.
The American way of mea culpa is so foreign to the Asian culture.
Shame or loss of face is handled internally and avoided publicly in
most Asian cultures, unlike the prevailing American way of admitting
mistakes openly.
Japanese-based top management has been reluctant to speak out, yet Jim Lentz, COO of Toyota Motor Sales USA, has been remarkably unconvincing in his remarks on news programs.
And Akio Toyoda, CEO of Toyota, was virtually invisible until late last week.
This reflects a cultural tendency to withdraw during a time of embarrassment rather than outwardly show contrition.
3. Denial.
Toyota had a massive problem with engine oil sludge affecting some 3.5 million vehicles earlier last decade. Even with this prior experience, Toyota seemingly didn't learn much from its prior experience and has again been in denial of product defects:
• First it’s the floor mats catching under the pedal. Now it’s a mechanical bearing subject to moisture that is to blame. Could it be the electronical control unit? What and who is a Toyota owner to believe?
• Toyota has publicly stated that there are no sudden acceleration related problems with the ECU, the electronic control unit. Yet when local TV stations show what the dealer technicians are doing as part of the recall retrofit, footage shows a laptop being hooked into the ECU port to fix the ECU programs.
• Toyota was quick to point at a supplier as the manufacturer of the faulty pedals. Yet the design and engineering specifications are Toyota’s. And the supplier also works with other vehicle manufacturers that don’t have a sticking pedal problem.
• Given the floor mat recall in November, Toyota has known of the
sudden acceleration problems for some time, yet it took pressure from
federal officials for Toyota to bring about the latest round of action.
Is this the end of the story?
Not by a longshot. Only time will tell, but right now events at Toyota are like a snowball rolling downhill.
You can bet on a future backlash from carpenters and tradesmen who currently own a Tundra or Tacoma and about zero sales conversions from General Motors, Ford, Chrysler and Nissan pickup truck owners.
Used Toyota values and lease residuals will be dramatically lower. Only time will tell for how much and how long.
Toyota's Japanese headquarters and Toyota USA need to centralize
crisis management. The cultures are different; the multiple spokesmen
are contradicting one another and confusing the public, particularly
Toyota owners.
Toyota's U.S. leadership is trying to say the right thing, but it's coming across as insensitive, insincere and empty.
If Toyota losses pile up, they only have themselves to blame. But it will deeply affect the economic well being of its suppliers and communities around the 14 plants in North America.
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Mr. Ypsilanti
Posted Feb 8
Great story, this is just what we needed in Michigan.
Jon Saalberg
Posted Feb 8
annarbor.com has a developer who likes cars comment on Toyota's future? How about Csaba Csere or David Cole?
Also, this from Mr. Kwan: Toyota, it seems, is having its own Tiger Woods moment. Tiger's reputation was permanently tarnished when his perpetual infidelities were revealed. Americans have short memories and Mr. Woods and Toyota will both survive their respective storms. Remember Ford, which is now experiencing a product and sales renaissance, produced the incendiary-prone Pinto, and wonders of automotive excellence such as the Edsel, Fairmont, Versailles, and Maverick. How many duds has Toyota produced, and how many serious recalls have they had in 72 years?
1BlockRadius
Posted Feb 8
Is this an editorial ?
braggslaw
Posted Feb 8
The far left has always characterized Toyota= Good and Big 3 = Bad. The chickens have come home to roost.
Toyota has hidden and suppressed many of their quality problems and in many cases ignored the laws of United States. NHTSA had to force them to recall their vehicles.
The problem may be the pedal, it may be the floormate but anyone who understands vehicle controls knows that their is a flaw in their torque software and fault tree analysis. When the brake and accelerator pedal argue, the brake should always win.
If you like foreign car... fine buy it, but don't buy it and tell everyone that it is American... because it is not.
95% of the value added activities for Toyota happen in Japan and the profits and taxes return to Japan.
Don't buy a Toyota because you think it gets better mileage than an American car... it doesnt.
Malibu beats Camry
Silverado beats Tundra
Equinox destroy the RAV4
Travers beats Highlander.
These cars all get better fuel economy than their Toyota counterpart.
I know that those on the far left of the bell curve will come out and talk about how "green" Toyota is, or how they help the planet etc. (e.g. Toyota good Big 3 bad) Well you've drunk the kool-aide, the auto industry is about making money and marketing cars.
I am sure that there will also be comments on how some Big 3 cars are made in Mexico and Canada. My response those cars are engineered and designed in Detroit with a ton of North American content. (more than a Toyota)
Top Cat
Posted Feb 8
The German word Schadenfreude comes to mind.
Edward Vielmetti
AnnArbor.com Staff
Posted Feb 8
A comment was removed because it contained the output of a very long report, in all caps, from
http://www-odi.nhtsa.dot.gov/
the NHTSA "Office of Defects Investigation". If the commenter would like to work with me to put something together that can be stored on annarbor.com or some other site for reference, I'd be happy to help.
EyeHeartA2
Posted Feb 8
Jon;
Let's try this again. Evidently, my first post was too long? Either that or the editor has stock in Toyota. Who knows? They just delete stuff here and never even mention why. Anyway, the answer to your question is 833 recalls. Toyota has had 833 recalls, which are by definition serious. As far as duds go, that is subject to opinion. You probably have your opinion and I have mine. I suspect my number is much higher than yours.
http://www-odi.nhtsa.dot.gov
uawisok
Posted Feb 8
In my opinion these recalls and quality problems toyota is currently facing will befall anyone when mass producing millions of autos per year....it's is just as much a matter of statistics and probibility combined with human error....it's their turn in the barrel.
EyeHeartA2
Posted Feb 8
@nawisok
Sort or reminds me of the German phrase: es ist an der Zeit. I have no idea if that is a decent translation for "It's about time" or not. But, yes, I agree with you totally. Ford and GM have been in a statistical dead heat quality wise for many years now with the Japanese imports. While some brands are rated higher than others, the difference between them is minor. Yes, everyone has their "I drove my (fill in the blank) for 250K miles", and had no issues, but that is anecdotal evidence, not statistical. I think a lot of people have known this for a long time and really get tired of bashing the home town boys.
I never understood that. As much as we like to think that here in Ann Arbor we are so much above that oily nonsense, the fact is, that the guys that build the cars contribute mightily to the local economy. 25 years ago, there were 2 plants at Willow Run, one on I-94, plants in Milan, Saline and all those places that went begging for a county wide milage last fall. Now....most are gone and we wonder what happened to our tax base.
So sure, blame the UAW, greedy management, poor engineering or poor manufacturing or poor quality - whichever side of the fence you are on, but at the end of the day, bashing the big three is only hurting yourself.
The press tends to be slow to react to these things, stuff is never as good or bad as it is portrayed at the moment. Toyota doesn't need to come back, when we look back in a year we will find they never will have left. The press is overplaying this one - but for now...."es ist an der Zeit".
billmcclure
Posted Feb 9
Toyota has a new slogan--Toyota Moving Forward Whether You Want To Or Not----------Americans need to be as loyal to Ford -GM--as the Japanese are to Asian Autos---there is no way , Ford or GM will ever sell cars in Japan or South Korea--Why--because the product is not Asian---the numbers don't lie--however the Japanese do---this current problems has been hidden from the public since 2004---who ever buys Asian auto's in the USA are guilty of Econmic Treason---it is even more of a crime for folks who derive their paycheck from taxpayer funding--ie---teachers --goverment workers --public safety--and by the way most Asian autos are made in --you guessed it ---ASIA---I always say the proof is in the pudding--where have all the jobs gone in the USA---to the PREDATORS IN JAPAN--SOUTH KOREA--CHINA---and our military protects south korea and japan from their enemies--lastly--just what does either one of those countries really contribute to the welfare of this country--their factories do not come close to replacing the millions of workers effected by their actions--I am not a union person or a stock holder in the US companies--but I know that buying from people who are looking for one thing from the buyers in this country--to dominate---we couldn't even participate in their cash for clunker program--and who sold the most in our program--THE PREDATORS--and not because they have the best products--that has been proven--people who buy their cars and trucks in the USA remind me of folks on the high seas who run out of fresh water--and drink from the ocean--it taste good now,but it is going to end up killing you --