Is Toyota Slipping?

[suburban george3]

After finally achieving the crown of the world's top automaker, Toyota is taking some hits to it's image.

Some in the auto industry are starting to think the bean counters are getting to much control in the production process, witness the new Venza, which has been panned by most critics as an un-needed addition to the line-up with questionnable build quality compared to previous models.

Next, gas pedals are sticking due to floor mats which resulted in sudden acceleration. That led to a recall of 4.2 million vehicles.

Now their is concern the design of the gas pedal itself is causing the same issue. If any accidents have been caused (or fatalities) is unclear. This has now evolved into another investigation resulting in a complete suspension of sales of 8 Toyota models; the RAV4, the Corolla, the Camry (except Hybrid models), the Matrix, the Avalon, the Highlander, the Sequoia, and the Tundra. This is the bulk of their US lineup, and 5 manufacturing plants are also being idled so the company can get a 'handle' on the situation. At this moment, some 2.3 million vehicles are effected by the current recall over this issue.

There will be an immediate hit to Toyota and dealers over the loss of sales for an indeterminate time but will this put a bruise big enough in Toyota for it to lose market share back to a gov't backed GM and/or a surging Ford? Has Toyota gotten so big that it may starting making some of the mistakes the U.S. big three made that got them into the mess we had to bail them out of?

I haven't heard many owners 'dish' on their Toyotas but I know it has to be in the back of their minds at least...

MSNBC article on Toyota suspending sales

[Neo]

Every auto manufacturer has their hiccups from time to time and though this appears to be a major case, I don't think it's enough for owners to ditch their Toyota's just yet. They've built a great reputation and their handling of this situation appears to be as expected for a company with such a reputation. I'm sure QA issues are in the back of the minds of Toyota owners, but other manufactures have also had issues in the past so why jump ship over one issue?

Having said that, Toyota certainly needs to clear the air and not have another recall of this magnitude. Three strikes and you're out IMO, fortunately Toyota isn't there yet.

[Gard]

While this will no doubt be hanging over their heads for a good time to come, I think that it's really too early to tell what the extent of the damage will be to the brand. I do see other automakers seizing the opportunity to sell their cars, as GM is doing now by offering zero-percent financing to people trading in a Toyota, plus a $1,000 down payment towards a new GM vehicle. As it was mentioned in one article I was reading about this, it's not the long-time Toyota users that the company is worried about, but the young people they are trying to turn into life-long Toyota users and aren't yet loyal to the brand. This is where it could have long-term implications for the brand, as it leaves a much less reliable pool of buyers, which is what has powered their brand for generations now.

[suburban george3]

I'm sure QA issues are in the back of the minds of Toyota owners, but other manufactures have also had issues in the past so why jump ship over one issue?

Having said that, Toyota certainly needs to clear the air and not have another recall of this magnitude. Three strikes and you're out IMO, fortunately Toyota isn't there yet.

[suburban george3]

Well, news is NOT getting better for Toyota. It has now come out that the recall wasn't considered for the gas pedal 'flaw' until a US government official travelled to Japan to 'convince' them of the seriousness of the issue. NHTSA is saying that Toyota is NOT safety minded and slow to respond. Now, revelations are coming out that the fix for the gas pedal may not be the problem and it could be in the electrical system. Also, an investigation is underway in the United States and Japan over brake issues which have caused accidents in the popular Prius model.

Transportation Secretary Ray LaHood has urged all Toyota owners to quit driving the affected vehicles until the dealerships have made necessary repairs. Read the MSNBC article here.

Toyota is acting like a deer in the headlights as far as corporate response. They need to get this under control FAST as this is now damaging the brand worldwide.

[Neo]

That does change the way I view the company. If it is true that Toyota had to be forced to do something about this very serious issue, then the company will most definitely not stay at the top for much longer. Toyota got to the top because of their safety record and attention to concerns, by placing it on the back burner they will certainly commit suicide with their customers.

[suburban george3]

This story is developing rapidly today, I have GOOGLE set on Toyota recall and it's adding new tidbits almost every few seconds. LaHood has backed off his statment to 'quit driving Toyotas' to 'get them to a dealer for repair ASAP.'

Reading more about it, this debacle will cost Toyota in many ways. Insurers will look thru accident claims involving the affected models to see if they can pursue Toyota financially, costs to Toyota for insuring their warranty repairs will increase, not even mentionning lost sales.

The media is having a field day with this of course, Japanese media saying the American press is pressing this to help Detroit. Honda is concerned that this could bleed over to other Japanese manufacturers.

The global recall is expanding as it now encompasses Israel, Ireland, Mexico, and S.Korea. At this point the recall is approaching 8 million vehicles worldwide, more than the total number of Toyotas sold in 2009.

[Gard]

The Prius is now involved in the recall fiasco and has 400,000 of them so far being recalled. USDOT is now investigating issues with the Corolla as well. Doesn't look like Toyota is going to catch a break anytime soon. To make matters even worse for Toyota, State Farm came out today and publicly stated that they had warned the Feds about the gas accelerator issue way back in 2007 and nothing was done about it. Apparently State Farm had a number of accidents related to the gas pedal that started back in 2007. This not only looks bad for Toyota, but terrible for USDOT if they ignored State Farm's warning. I am betting that it's now only a matter of time before other major auto insurers speak out on this issue. Meanwhile, GM and Ford are having a heyday with Toyota's problem. Both are offering special financing and down payments on new vehicles for every Toyota traded in and both are reporting double digit sales growth. GM has even had to hire additional people for their call center because they can't keep up with inquiries about the specials for trading in a Toyota.

I am betting that there will be a new company on the top before long...

[suburban george3]

Well, now to add more fuel to the fire under Toyota's feet, there has been an internal Toyota presentation touting that getting U.S. regulators to limit the scope of the original floor mat recall to only 55,000 Camry's and ES350's saved the company $100 million dollars. This was presented on a slide titled 'Wins for Toyota - Safety Group.' The feeling is now that Toyota sacrificed consumer safety to save money and become the #1 global automaker.

The CEO of Toyota, Akio Toyoda, is to testify in front of Congress Wednesday. Hopefully he does better than Masatoshi Ono the Bridgestone/Firestone CEO who failed miserably in his questionning by Congress during the Explorer/Firestone recall. Sen. Barbara Mikulski, D-Md., even asked where his "sense of concern as a human being was." He resigned his position a month later.

The SEC is also investigating Toyota, as well Federal Prosecutors readying a criminal investigation. Mr. Toyoda has A LOT of work to do Wednesday.

[cityboi]

Its pretty bad. There is a fellow here in Greensboro that will sue Toyota because his car accelerated and got in a wreck. When it hits that close to home, I wouldn't feel safe driving or riding in a Toyota.

[Neo]

Its pretty bad. There is a fellow here in Greensboro that will sue Toyota because his car accelerated and got in a wreck. When it hits that close to home, I wouldn't feel safe driving or riding in a Toyota.

I'm going to play devil's advocate for a moment and state that finding Toyota at fault for something like that could potentially be a very hard thing to prove. Many people see dollar signs when something like this recall is made public, particularly if the company is vulnerable. Look at this story about an out-of-control Lexus that now has 27k miles put on it by the new owner without any issues whatsoever:

http://consumerist.com/2010/02/out-of-control-lexus-still-on-road-apparently-working-fine.html

It makes me wonder just how overblown this whole thing has gotten.

I'm not minimizing the seriousness of the issue or the fact that Toyota should definitely fix any wrong doings, but I also believe there are people in this world very willing to take advantage of the situation.

[suburban george3]

I'm going to play devil's advocate for a moment and state that finding Toyota at fault for something like that could potentially be a very hard thing to prove. Many people see dollar signs when something like this recall is made public, particularly if the company is vulnerable. Look at this story about an out-of-control Lexus that now has 27k miles put on it by the new owner without any issues whatsoever:

http://consumerist.c...rking-fine.html

It makes me wonder just how overblown this whole thing has gotten.

I'm not minimizing the seriousness of the issue or the fact that Toyota should definitely fix any wrong doings, but I also believe there are people in this world very willing to take advantage of the situation.

[Gard]

I find the refusal to release black box information troublesome as well. For that matter, I think that it should be illegal to withhold the black boxes, much like it is for airplanes. This information could potentially help in court cases and other investigations and would no doubt be very solid evidence. It makes you wonder what they are trying to hide and for that matter, I think it is very bad for customer relations.

[UTgrad09]

Toyota certainly has some major issues to work out. I don't think anyone will deny that.

However, I believe the attention of this case has been blown out of proportion and there has been a witch-hunt by congress never seen before by an automaker.

Not that Toyota does not need to pay serious attention to their problems, and fix them...but I believe they are getting unfair scrutiny from Congress. Problems like these have arisen in the past, but have not gotten the same attention from the government.

Did Toyota cover things up? Perhaps. No company wants to panic with a defective product....that results in millions in lost revenue. Let's face it...if they can avoid that, they will. But now Toyota isn't concerned about that. The major image damage has already been done.

So let's get to the facts...what is causing this?

Does Toyota have a problem with it's acceleration system that is hard to find, and nearly impossible to diagnose? Do the cars actually accelerate without warning and out of control? Can they be stopped?

Everything I have read has suggested that this is not only a manufacturer's problem, but a driver problem and a fraud problem, too.

We have already heard about the skepticism involving the case in California with the Prius driver who drove for a good ways "claiming" that he couldn't stop his vehicle.

In all cases, it has been demonstrated that the system is designed to shut down if the brake is applied at the same time as the accelerator (for 3 seconds, I believe)...and also, with everything I have read in car or mechanics related literature, the system's failsafe's are not easy to fool, and can be manually overrided (hard breaking or taking the car out of gear can slow the car down).

So the question to me is, where do we draw the line between simple defects/reliablilty and driver error/fraud/congressional witch hunts?