By on February 13, 2010

Don’t bogart that joint: Toyota will recall about 8,000 model-year 2010 Tacoma pickup trucks in the US. Not for unintended acceleration, or brake gremlins, but for good old cracks in the joint portion of the drive shaft, says Reuters. The front drive shafts are manufactured by Dana Holding Corp, and the affected vehicles were produced from mid-December 2009 to early February.

Don’t ruin more jobs: Toyota has dispatched two dozen workers from plants around the U.S. to visit Capitol Hill. According to a Reuters report, the company is also using other means, such as a $5.2m lobbying budget, to remind lawmakers that Toyota employs 33,400 people. Indirect employment, including dealers, accounts for another 160,700 jobs, says Toyota.

Don’t think GM profits from Toyota’s weakness: GM’s vice chairman Bob Lutz said GM will gain market share regardless of safety problems, Reuters reports. “If the competitor’s weakness at some point results in lower sales for them and better sales for everybody else, that’s something that obviously we’ll accept,” Lutz said. “But as far as we are concerned, it is not a factor. We’re not planning on that. We were going to gain share anyway.” GM’s U.S. sales jumped 14 percent in January from a year ago and its market share rose to 21 percent, while Toyota’s sales fell 16 percent to the lowest level in more than a decade. Some industry observers are seeing weakness in February sales and blame Toyota for it.

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54 Comments on “And In Other Toyota News …...”


  • avatar

    This is fantastic. I’m going to wait till their stock hits ROCK BOTTOM and then I’m buying in with about $2000.

    Toyota is still the largest automaker int he world, so I know they’ll recover eventually, but for now, their failure is my opportunity.

    their CEO’s should all commit Seppuku so we can knock their value down another $15 or so.

    • 0 avatar
      crash sled

      That’s a pretty good investment strategy. You could short ‘em on the way down, and you can make money on both ends of it, when they go up.

    • 0 avatar
      don1967

      They say that the only people who ever catch the bottom are proctologists and liars.

      Toyota is already trading at a 13-year low, which is a 58% discount to its all-time high price. It is being bashed by every media outlet. If you’re not buying it right now, you probably never should.

    • 0 avatar
      dartman

      “Toyota is already trading at a 13-year low” Don1967, Where do you get this? TM (NYSE)was as low as $56.79 in the last 12 months and closed at $77.05 on Friday…

    • 0 avatar
      baldheadeddork

      Be careful. The cost of extended warranties and higher incentives are going to cause a major hit on Toyota’s profits for years to come.

      Toyota’s share price through this mess doesn’t show that the market has priced that in yet. Investors still have strong positive feelings about TM because (like you) they’re going off Toyota’s reputation and performance before the recall. When the future earnings and profits are cut I think you’ll see the share price fall, and it won’t recover until the profitability returns to its pre-recall levels.

  • avatar

    Jimal’s law.

  • avatar
    CyCarConsulting

    Corporate out sourcing of components is more of the real problem than Toyota itself. Looking at the corporate world one finds inept people in upper management due to the ability to kiss ass rather than perform jobs. This cancer trickles all the way down to the assembly line, resulting in what is now inferior products throughout the world, not just in Toyotas.

    • 0 avatar

      i’ll agree with you that outsourcing in general hurts the quality of products, but the thing is, Toyota could have kept factories producing DENSO pedals overseas rather than changing to another design and fuging everything up.

      Am I wrong?

    • 0 avatar
      Christy Garwood

      Flashpoint, I believe fugue is a noun, not a verb, but very apropos for the current state Toyota finds themselves in

      from wikipedia ” A fugue opens with one main theme, the subject,[5] which then sounds successively in each voice in imitation; when each voice has entered, the exposition is complete”

      I realize most of you will think I am biased, since I work for GM, however, the sales data reported here, prior to Toyota’s woes, shows Buick LaCrosse, Chevy Equinox and Malibu, GMC Terrain, and Cadillac SRX vehicles selling like snow shovels in DC last week.

    • 0 avatar
      Robert.Walter

      @flashpt:

      Yep, you’re wrong.

      It is not supplier outsourcing that is the problem, indeed, that is a major benefit on the cost-side because of the opportunity to invest in and keep specialized machines and processes filled to capacity. Additionally, outsourcing offers the opportunity for excellence and profit due to the distribution and concentration of the work (in this way, the supplier who is specializing in a product for several customers is constantly being challenged to improve the product.)

      Outsourcing is one of the trends that has allowed quality of all OEM’s to improve.

      Look at it in reverse, if a company was totally vertically integrated, and did the design and manufacture of every last thing that went into their cars would they really be able to be the best or most efficient at it? Would technology be able to advance as quickly as it otherwise has?

      (note at different times, even the poster boy of vertical integration, Crazy Henry, bought engines from the Dodges, wheels from K-H, valves from Manoogian, seat belts from Jim Robbins, etc.)

      @christy: i’m wondering how those sales figures change if spiffs (cash on hood and lease deals) are taken into consideration.

  • avatar
    George B

    Wouldn’t suspending sales of 8 Toyota models built in North America put a dent in the Toyota’s sales numbers? Not good, but better than having lots of cars to sell and few willing buyers.

  • avatar
    mcs

    There’s much more to the story. It’s a Dana supplied part used by Toyota, Ford, and Nissan. Only Toyota is taking action.

    http://www.reuters.com/article/idUSN1217484220100213?type=marketsNews

    • 0 avatar
      blue adidas

      Probably because the Tacoma trucks are already being recalled for the other safety defects and it’s no extra effort or expense to add this to the checklist. There haven’t been any reported part failures resulting from this.

    • 0 avatar
      crash sled

      The Tacomas were recalled for the floor mats only, although I didn’t bother taking mine in.

      If you’re not smart enough to keep your floor mat properly anchored, or not smart enough to keep ANY floor mat away from your floor pedals, you probably aren’t smart enough to be driving an automobile, and shouldn’t be doing so.

    • 0 avatar
      Robert.Walter

      @crash: With statements like that, I hope that you are just running the HYGE-sled and not on the product-design or human-factors side of the business!

    • 0 avatar
      crash sled

      Nice throwaway snark, but it smacks of the salesman.

      Not that salesmen aren’t a necessary evil, they are, if their numbers are cut by about 2/3′s or so, as we finally seem to be figuring out here in Detroit, or at least are being forced to accept, by those who do understand.

      Toyota certainly can’t call their customers dumb, and they’re not, but anybody with some common sense can and should do so. Rule #1, in my father’s first driving lesson I got many shifts ago. No loose impediments in the cab of the truck, no cans of starting fluid, nothing, to be allowed near those floor pedals. Basic driving skills.

      If you leave the lugnuts off or loose when changing a tire, you might die. If you allow your floor mat to get hung up on the floor pedals, you might die. Duh.

      Toyota can’t say that, but it has to be said. And no, my 2-year old Tacoma won’t be making its first trip in for dealer service over THIS foolishness. (and I’m not a riceburner fanboy, by any stretch, if you’re wondering).

  • avatar
    Odomeater

    This is truly hard to believe. We are watching what was once a model company being sliced and diced to shreds. Little did we know of all the compromises, cover ups, poor quality and safety issues this company was involved with. A shame. Goodbye Toyota.

  • avatar
    OldWingGuy

    I believe the quality problems began when Toyota and Honda started manufacturing in North America. Especially with locally sourced components (ie gas pedal gear from Canada, Dana parts from US).
    I was looking at the Crosstour recently (despite its looks, it has features I find usefull – V6, AWD, headroom). Made in USA. Thanks, but I will take a pass.
    If you’re going to get North American quality and reliability, no sense paying a premium price. Might as well just by from GM or Ford.

    • 0 avatar
      Robert.Walter

      I’ve been looking for the logic in that statement but am afraid it completely escapes me.

    • 0 avatar
      blue adidas

      Actually you’re completely wrong. Toyota and Hondas problems are worldwide and include vehicles built in NA and vehicles that are imported.

    • 0 avatar
      CorvairDan

      Quality has been going up every year for just about everyone. J.D. Powers serveys show everyone is getting better. Toyota like all car companies, buy much of their parts from other companies. When the Japanese companies started making cars here, everyone was concerned how the quality would be. Toyota continued to improve quality as they made more cars in the U.S. with more and more U.S. parts. My 04 Toyota was made in Canada and the transmission was poorly made in Japan. The transmission let me down. $3000 to replace. It is how well the company is managed that determines quality.

    • 0 avatar
      John Horner

      The built in Japan = good, built in the US = bad thesis doesn’t hold true at all.

      Toyota had many quality problems over the years well before they started making things in the US. My father was a Toyota salesman in the 1970s when the shop was kept busy doing valve jobs due to a bunch of incorrectly made heads back-in-the-day for example. Toyota also built horrifically rust prone vehicles for many years well before any US factories went on line. Toyota’s sludge prone engines were as likely to be made in Japan as anywhere else. The early 1990s Toyota V-6 recalls to redo the head gaskets were applied to Japan built engines. The list goes on. It isn’t the country of manufacture that makes the difference.

    • 0 avatar
      joeaverage

      OldWingGuy – are you saying you are going to skip the CrossTour b/c it is made in America and you expect the same problems from a Detroit product?

      Just curious.

      FWIW We’re on our fourth Honda car, second Honda motorcycle and 1st generator – they have all been very, very good. I don’t expect anything has changed. Previous Accord had 325K on it the last time I saw it, current CR-V is 191K trouble free miles.

      Has anything changed at Honda except that they have gotten expensive ($$$ to purchase) and the styling has gotten a little “out there”.

    • 0 avatar
      OldWingGuy

      I’m just going on my personal experience.
      Had an ’84 Accord, Made in Japan, great car. Wish I kept it.
      Had an ’90 Civic, Made in Japan, great car. Wish I kept it.
      Had a ’95 Civic. Made in Canada. Junk. Glad I got rid of it.
      Have a ’03 Accord. Made in USA. Junk. Still stuck with it.
      Coincidence ? Maybe. Part of a larger picture ? Maybe.
      Is it because they are sourcing parts etc in NA and can not control the entire manufacturing chain ? Maybe. Is it because they simply grew too large too fast ? Maybe.
      In the end, it doesn’t matter to me.
      Stack up a Toyota or Honda, model for model, against GM or Ford. You pay thousand$ more for an equivalent model. Its not because of technology (GM has DI engines, 6-speed transmissions, etc). its because of the “perceived” quality.
      If the quality of Honda, Toyota, etc, is actually at par with GM, Ford, etc, then why pay a premium price? Might as well buy domestic.
      In the past, people finally wised up after buying one crappy domestic vehicle after another, then shopped someplace else. I reached my limit after two crappy vehicles.
      But thanks for the above info. I was only going on my own personal experience. I never realized there were as many problems for Made in Japan cars as well. So that puts me back looking at the AWD Focus or AWD Taurus. And leaves me with $5k to $8k in my pocket.

  • avatar
    mcs

    This is actually something positive. Here is a case where Toyota is performing a recall, but Ford and Nissan are going to let it slide. Ford and Nissan got the same bad parts, where is their recall? Good luck if one of these parts is on your Escape/Mariner.

  • avatar
    forraymond

    GM was number one for years and no one is expecting them to come back. What makes Toyota different? The are chasing bottom line profits and share value, not product quality and design superiority.

    • 0 avatar
      Christy Garwood

      How do you define number one? GM sells the most vehicles in the NA market and has for 50 years or more.

    • 0 avatar
      Robert.Walter

      @christy: Be careful not to slip back into old thinking. Measuring itself as #1 in sales was one factor leading to the destruction of GM.

    • 0 avatar
      Christy Garwood

      Robert, forraymond was implying that number one was in sales. Hence my question to clarify the assumptions. My point is that GM has always sold alot of vehicles in the USA regardless of the rhetoric that came out of DC that said GM made cars no one wanted to buy.

  • avatar
    pgcooldad

    Toyota’s corporate culture coming back to bite them:

    Former Toyota lawyer, Dimitrios Biller:

    ABC News reports Biller as saying “You have to understand that Toyota in Japan does not have any respect for our legal system. They did not have any respect for our laws.” Biller worked as managing counsel for Toyota’s American operations from 2003 to 2007.

    Biller, who handled product liability suits while at Toyota, claims that when the auto manufacturer received poor results in a vehicle rollover test, it ordered a new test in order to receive better results. And he also said that the company also made a practice of concealing proof of safety problems, and did not disclose information it was obligated to produce during litigation. “They were hiding evidence, concealing evidence, destroying evidence, obstructing justice,” said Biller.

    “In my view, absolutely,” was Biller’s response to ABC’s questions as to whether Toyota would lie to the federal government.

    • 0 avatar
      ihatetrees

      ABC News reports Biller as saying “You have to understand that Toyota in Japan does not have any respect for our legal system. They did not have any respect for our laws.”

      Even better news: There’s probably 50 million Americans in America that have zero respect for our tort liability system.

      Biller worked as managing counsel for Toyota’s American operations from 2003 to 2007.

      Who’s paying Biller to flap his gums now?

    • 0 avatar
      psarhjinian

      Who’s paying Biller to flap his gums now?

      Biller is being paid by several people who are suing Toyota. He’s been around for a while and there’s a long and interesting story there.

      The short story is that he’s not exactly an angel.

  • avatar
    Gardiner Westbound

    Widespread sympathy is developing for Toyota in Canada. Several prominent commentators say Toyota is the victim of a U.S. government and media witch hunt. Is this fact-driven, heartfelt conviction or is Toyota calling in IOUs? I’ll leave it up to you.

    http://tinyurl.com/yklm2wn

  • avatar

    the literal translation of “Toyota” is Asbestos. you’ll soon notice the similarities by volume of lawsuits.

    • 0 avatar

      Nonsense. Asbestos is asubesuto in Japanese ….

      Speaking of asubesuto … Friday’s Nikkei:

      Suzuki To Recall 4-Wheel All Terrain Vehicles Containing Asbestos

      TOKYO (Kyodo)–Suzuki Motor Corp. said Friday it will recall four-wheel all terrain vehicles that use parts containing asbestos beyond the legal permissible level.

      While saying no health problems have been reported over the quad bikes sold in Japan, Suzuki said it will replace the parts with new ones.

      Suzuki said asbestos was found in imported brake parts, which were used in 10 units sold since 2006 when regulations on asbestos use were introduced and in 26 others sold before that year.

      The automaker said 634 parts alone have been imported into Japan since 2006 and 426 of them were exported.

  • avatar
    eastcoastcar

    Toyota has apparently reached their goal of allowing MBA’s to decide engineering quality for the company. They will now reap those benefits, and their MBA’s will be rewarded.

    • 0 avatar
      Christy Garwood

      I have spent a large part of my career on the manufacturing side of the house at GM, first in gas turbine engine components, and later stamping and welded assemblies, as well as final vehicle assembly.

      A cracked drive or prop shaft is the result of either the forging process or the heat treating/ quench process after machining. Variation is inherent in manufacturing – no company is immune to it. It takes alot of people and processes to manage all of the complexity, sometimes down to the mine where the ore was dug to make the steel components.

  • avatar
    Geo. Levecque

    Like any good corporate system, Toyota chose to invest in Parts in Countries where they make vehicles, and look what happens Like DANa Corporation, long know for there screwed up workforce, they should have kept the parts coming from Japan imho!

    • 0 avatar
      Ion

      Dana makes parts for literally dozens of companies not just in the US. They also build parts for commercial vehicles, ATVs, Industrial and agricultural equipment. The problem is they build to the companies specifications and as we’ve already seen Toyota cheaps out in that department.

  • avatar
    mcs

    Dana Corp ships cracked drive shafts to Ford, Nissan, and Toyota. Ford and Nissan decide they aren’t going to recall their vehicles. Toyota decides to do the right thing and issues a recall. Why is it that Toyota gets dumped on and the real bad guys here, Ford and Nissan, get away with neglecting the problem?

    Bertel’s article left out the part about Nissan and Ford. You need find the articles with the entire story and read them.

    • 0 avatar
      Christy Garwood

      Hmm, are you saying that this site is the partial truth about cars?

    • 0 avatar
      psarhjinian

      Why is it that Toyota gets dumped on and the real bad guys here, Ford and Nissan, get away with neglecting the problem?

      Because the media is doing a horrible job of explaining that recalls aren’t done for non-safety issues and because Toyota is playing it safe and recalling everything rather than risking being labelled as negligent.

      A little intelligence in reporting would be nice, but “intelligence” doesn’t sell ad-space, nor sound quite as pithy.

    • 0 avatar
      KingShango

      Ford and Nissan don’t have a global quality crisis to deal with. Right or wrong, perception is reality and Toyota has a huge image problem right now. They have to recall every vehicle at the mere mention of a problem. Ford on the other hand is riding pretty high right now.
      According to the article less than 2% of Ford’s 17,000 units COULD have a problem. They investigated and found no problem. If I were Ford I wouldn’t recall either.

    • 0 avatar
      jkross22

      Kingshango,

      I agree with you 150%. Toyota is damned if you do, damned if you don’t. To their CREDIT, they’re erring on the correct side of the equation, and sadly, due to their poor handling of the various recent problems, this action will be interpreted by most as one of many drip, drip, drip problems with Toyota quality.

      A shame, really.

    • 0 avatar
      Robert.Walter

      @mcs: In my post to a Toyota-related thread the day before, I flagged Bertel and Ed on the Dana recall; but also came back with an edit to add Ford and Nissan (neither were in the earliest report that I saw) Bertel forwarded Nikkei’s report, so perhaps Nikkei missed these factoids (but due to the Nissan connection, I doubt it.)

      To add to Psjar’s and Christy’s (Gas turbine, stamp & weld, and assy? Wow, three different and interesting worlds, eh?) comments, even though there is a common cause (Dana mfg. non-conformancies), there are a multitude of factors that go into influencing a failure mode, as well as the point and frequency with which it presents.

      In a prop-shaft assy, things like length of shaft and the drive angle thru the cardan joints can induce bending loads into the shaft assy, and thus put extra strain on the flanges, the needle bearings, the yokes, the welds, the tubes, the slip yokes and joints. I doubt that F, N and T have the same angles, torque and shock loads being delivered thru these assys. So even if the assys are identical (which I doubt), and even if the failure mode is similar (or identical), I would really be surprised if the MTtF is the same for all 3 OEM’s.

      I’ve only seen that it is a front prop shaft that is failing, but no other details, so my comments above are in the abstract, with the assumption it is the smaller shaft leading from the trans to the front x-fer case.

      Depending on how the assy fails, and how it is constrained in the vehicle by surrounding objects, it may not be deemed a safety item worthy of a NHTSA recall listing.

      (More disclosure: 15 years ago, I intimitely knew the Dana 1310,1330 as well as the Ford 1330,1350+(D/EW98),1410(never used) as well as developed an impressively large and shiny 3-legged differential pin (Ford P131HD axle!)

    • 0 avatar
      Christy Garwood

      Robert, yes, GM has provided me with the opportunity to have varied experiences while working continuously for one company. I went from a plant that made 25 large gas turbine engines and 400 small enginees a month to GM truck volumes of 100,000 per month. While there isn’t much styling that has to be done to a turbine engine (LOL), designing, testing, validating and building those engines versus passenger cars/ trucks has a lot in common.

  • avatar
    50merc

    Flashpoint, when your broker calls to tell you Toyota’s stock has stopped falling, please let me know. I’ll then check for any sign that Toyota’s premium-plus pricing model (few incentives along with price padding by both distributors and dealers) has been abandoned. It’d be nice if a Camry carried rebates like a Sonata.

    I was going to check Toyota’s website, but my anti-virus software blocked their site as having hidden threats. Anybody else have this experience? Do they now need to recall their Web pages?

  • avatar
    ohsnapback

    From Bloomberg:

    “•Regulators Hired by Toyota Helped Halt U.S. Safety Probes, Documents Show”

    Link: http://www.bloomberg.com/apps/news?pid=20601109&sid=aTfVxj4_pJh4&pos=10

    But it’s probably just plaintiffs’ attorneys fault.

    (In the famous words of TTAC articles; or not)

    • 0 avatar

      In your storied career as an attorney, you never met a criminal defense lawyer that touted his prior achievements as a district attorney? You never encountered a tax lawyer that was proud to have former IRS agents in his firm ? You’ve never referred a client in trouble to a DUI lawyer because he had been a former prosecutor for same offenses?

      You really think that Toyota is the only car manufacturer who has former NHTSA employees working on regulatory matters? You really believe that all other car manufacturers are stupid enough to not dip into this pool of expertise?

    • 0 avatar
      baldheadeddork

      Big differences, Bertel. Lawyers have responsibilities as officers of the court that guide their actions no matter who they are representing. Lawyers also present their cases to a judge or jury who have a separate responsibility to be impartial, and the procedure and evidence is open to the public for a real-time examination.

      None of that exists with NHTSA and the investigation of defects.

  • avatar
    baldheadeddork

    Yes, Bertel – it appears the other automakers are stupid enough to not use former NHTSA employees to lobby for them on defects.

    While all automakers have employees who handle NHTSA issues, Toyota may be alone among the major companies in employing former agency staffers to do so. Spokesmen for General Motors Co., Ford Motor Co., Chrysler Group LLC and Honda Motor Co. all say their companies have no ex-NHTSA people who deal with the agency on defects.

    The whole article is worth reading.

    http://www.bloomberg.com/apps/news?pid=20601109&sid=aR4THte3hl18&pos=10


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