Posted by: David Welch on January 29, 2010
Toyota’s big recall problem just keeps getting worse by the day. The latest blow to the company, which stopped the sale of eight models that it said are “involved in the recall for sticking accelerator pedal,” is that Consumer Reports has suspended its recommendation of the models involved. Over the years, CR has lavished recommendation on Toyota’s cars and trucks in large part because they have been very reliable.
I don’t need to tell anyone that quality is the cornerstone of Toyota’s brand in the U.S. Consumer Reports recommended 27 of Toyota’s 32 models, giving the Japanese carmaker a great gust of wind at its back when it comes to winning converts. That number is now down to 15, though the magazine says Toyota can get the recommendations back pending resolution of the problem.
If that’s not bad enough, there is an even bigger threat to Toyota’s image. The company is no stranger to recalls, but to its credit Toyota has handled them swiftly and kept customers happy. Now that is under fire, too. Energy and Commerce Committee Chairman Henry Waxman said his panel plans a hearing on Feb. 25 to look in to what Toyota knew and when and if the carmaker moved quickly enough with a remedy, according to a story by Bloomberg. The news from Consumer Reports is a body blow, but the government hearings could be worse.
What members of Congress are wondering is if Toyota dragged its feet while sudden acceleration accidents continued to happen. Representative Bart Stupak (D-Mich.) went so far as to say that, “Incidents of sticking accelerators have been ongoing with Toyota vehicles for up to a decade and have led to a disproportionate number of deaths,” Bloomberg reported. That’s a bold statement and just the beginning of the kind of gauntlet Toyota is about to run through.
If the hearings get ugly—and Detroit’s carmakers can attest that going before Congress can be brutal—Toyota could be in for a hammering. Congress is snooping around the last pillar of Toyota’s great name—that it handles problems very well. Even if the hearings conclude that Toyota did a fine job of handling the recall and safety issues, the publicity could raise doubts with car buyers.
So far, consumers don’t seem irate, says Adam Simms, owners of Toyota of Sunnyvale (Calif.) He has almost 100 employees taking calls and he says so long as everything is explained, his customers have been OK with all that has happened. But it’s early days in this drama.
Someday soon, Toyota’s top management will need to come forward and talk to the American public. CEO Akio Toyoda will have to step up, tell his customers and future car buyers that the company has this under control and that it won’t happen again. Toyota has decades of goodwill with the American public for selling them good cars, creating jobs and doling out millions of dollar on philanthropy projects. It’s up to the company to react and keep it that way.