By on February 7, 2010

After piles of books have been written about the „Toyota Way,“ this round of recalls will have a permanent place in the annals of how to completely NSFW-up crisis management. The epicenter of the disaster at Toyota is not in the pedal dept., it is not in the software development dept., it is in the Public Relations Department in Toyota City. Or possibly, right at the top.

Last Friday evening, Toyota trotted out their CEO and founder’s grandson Akio Toyoda to address the complaints about Prius brakes. Toyoda said nothing of substance. What irked the public, and what became instant fuel to the already raging fire, was that Akio Toyoda refused to address the fact that Toyota had changed the Prius software, and changed the braking hardware in January, for cars in production. People wanted to know what happens with the cars they had already bought. Akio Toyoda left his customers in a lurch. Answering in very bad English instead through an interpreter made matters worse.

A day later, Reuters wrote that Toyota will recall the Prius “in the next few days.” Who was the source? A Toyota spokesperson? Nah. A “person close to the matter?” Nope. The source was a Toyota car dealer. “Toyota officials were not immediately available to comment.”

Today, the Nikkei [sub] writes that Toyota “has decided to recall and repair free of charge the latest model of its Prius hybrid sold in the domestic market due to complaints over brake problems.” And who’s the source? A Toyota spokesperson? Nah.

This time it’s “sources close to the matter.” The Nikkei says that Toyota “is expected to report the plan to the Land, Infrastructure, Transport and Tourism Ministry early this week, before announcing it to the public.”

In another report, the Nikkei cited another anonymous source that said “Toyota also intends to take similar steps in the U.S. and other overseas markets simultaneously, but didn’t elaborate.”

Still, mum’s the word from Toyota.

Japan’s transport minister doesn’t need a report. Japanese transport minister Seiji Maehara, had already said last Friday that Toyota will carry out either a recall or voluntary repair over brake problems with the Prius. Toyota wasn’t listening.

Last week, Japan’s Economy, Trade and Industry Minister Masayuki Naoshima said he hopes Toyota will respond to the situation ”as soon as possible.” Toyota wasn’t listening. Maybe because Naoshima had been a lower level employee at Toyota, then rose through the ranks of the unions before taking up a successful career in politics.

There are louder and louder voices in Japan, warning that its industry is losing its edge. Korea’s Samsung has pushed aside the Japanese to become the world’s top maker of LCD TVs. Sony has become famous for its “Sony timer.” According to Japanese lore, it’s a device in every Sony product that causes it to break once the warranty expired. “The auto sector and Toyota is our last hope to maintain a very strong brand image and market position for Japanese companies,” said Tatsuya Mizuno, founder of credit ratings firm Mizuno Credit Advisory. “But when we look at this situation at Toyota, we may lose that last hope.”

Akio Toyoda had his chance last Friday night to get in front of the news and to shape the message. He blew his chance. Instead, Toyota has turned into a mass producer of confusion.

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66 Comments on “Prius Recall, Or Not? Toyota, A Mass Producer Of Confusion...”


  • avatar
    pgcooldad

    “We are drowning in information but starved for knowledge” – John Naisbitt

  • avatar
    criminalenterprise

    This whole episode will be taught as a case study for decades. It will play the opposite side of the coin to the J&J response to the Tylenol murders in textbook PR.

    • 0 avatar
      GSlinger

      The Tylenol recall is frequently used as an example of corporate responsibility. However, it was a unique situation that was quite different than a defect or design issue. Since the problem was obvious and external, essentially no investigation needed to be performed – a total recall could be performed immediately. On the other hand a design problem or manufacturing defect can take a long time to investigate and initiate a corrective action, even under the best of circumstances. While not defending Toyota in this case, I think it may be unfair to hold them (or anyone else) up to the “Tylenol standard.”

    • 0 avatar
      Telegraph Road

      “I think it may be unfair to hold them (or anyone else) up to the ‘Tylenol standard.’”
      +1
      Indeed. Ford was unfairly held to that standard 10 years ago by over-simplifying pundits. It would be a shame if Toyota is too.

  • avatar
    Stingray

    If this gentleman is NSFWing-up things… how can the talk about economic war be justified?

    Is it a war when the CEO itself blows it like this? I think not

    I’m confused.

    Off-topic: I’ve noticed that lately the Toyota fanboys have been quiet. Curious, eh?

    • 0 avatar

      Stingray: You are confusing the reporting of the news with promoting an agenda. This is Thetruthaboutcars. We report the news, no matter what.

    • 0 avatar
      Clargnblost

      Not really a Toyota fanboy here – I’ve been sorta armchair watching this whole bash Toyota thing. Here’s my take:

      If the accelerator problem was on a Chevy, it’d probably have been quietly fixed in a service bulletin the next time you took your vehicle to the dealer for an oil change.

      As an example – I don’t see the Ford recall of its hybrid’s braking “problem” making big headlines. Firmware upgrade – nothing to see here – move along. If it weren’t for the high profile Toyota problems, it would not have even made the news.

      I think the US gov’t and media are having an absolute field day with Toyota’s bumbling public relations.

      -C

    • 0 avatar
      John Horner

      “Stingray: You are confusing the reporting of the news with promoting an agenda. This is Thetruthaboutcars. We report the news, no matter what.”

      TTAC could do a much better job of distinguishing between editorial pieces and news pieces. The “Trade War Watch” series is clearly editorial and the recent piece in question relied upon very carefully selected quotes to construct an argument. It is disingenuous to suggest otherwise.

    • 0 avatar

      John Horner:

      All “Trade War Watch” pieces ARE editorials, and clearly marked as such. As mentioned before, you need to do your homework before lashing out.

    • 0 avatar
      Jimal

      @Clargnblost,
      I think as much of the coverage of this on TTAC and other sites has to do with trying to figure out what went wrong; not just in the case of this particular component, but to the “Toyota way”. Had this been GM’s mess there would be a fraction written about because it would be more or less considered “par for the course”. Now that it is the company that has been held up as the shining example for so long that is having the issues there is much hand wringing and justifying going on. Heavy is the head that wears the crown…

    • 0 avatar
      Telegraph Road

      @Stingray
      There are no Toyota fanboys anymore–they are now Honda fanboys or Hyundai fanboys. Loyalty is fleeting in a competitive market.

    • 0 avatar
      Steven02

      @Bertel
      Not all are marked.
      http://www.thetruthaboutcars.com/trade-war-watch-3-us-tire-prices-to-rise-by-20-30/
      http://www.thetruthaboutcars.com/trade-war-watch-6-china-escalates-against-escalades/
      http://www.thetruthaboutcars.com/trade-war-watch-4-china-reports-usa-to-the-wto/
      http://www.thetruthaboutcars.com/trade-war-watch-5-obama%E2%80%99s-health-care-and-iran-sanctions/

      And, not all of them are “clearly marked.” (With the Editorial: in the title).

      To quote you…
      “… you need to do your homework before lashing out.”

    • 0 avatar
      Stingray

      Bertel, when I wrote about trade war, I was referring to the quotes in the editorial. And that people is talking about a trade war.

      However, Toyota is messing up BIG time itself. That its own CEO says “I don’t know” to questions important to its customers cannot be blamed on external organizations or a war.

      That is what confused me.

      I wasn’t and I’m not promoting an agenda. Far from that (I’m cured about many things in this site from the Farago era). As a matter of fact, when I was writing the comment I had to remove some words that surely would have made what you said a point.

      I read your personal opinion in another comment in this same “thread”. I don’t have as much insight as you have in the japanese culture, but surely not everything is clean or is being said in the media. A trade war is plausible, also a interest conflict within the US government. I can’t say yes to any of the 2, but wouldn’t be surprised at all if “discovered”.

  • avatar
    IGB

    This is becoming frankly tiresome. When will Japan’s Transport Ministry and now Trade and Industry Ministry cease it’s destruction and obviously politically motivated attacks on Toyota? Toyota’s experience may be just a harbinger of a growing backlash against domestic firms. The Nikkei jumping on board is simply adding fuel to the fire.

  • avatar
    Davekaybsc

    The one thing Japan still does like no one else is cameras. Leicas are just expensive toys, and most of them are just rebadged Panasonics. Samsung cameras are a joke. If you are a professional, there is only Canon or Nikon.

    • 0 avatar
      John Horner

      True, but it almost doesn’t matter. The real money is in consumer products, not professional ones, and the consumer everyday camera is rapidly becoming just one of the functions of a cell phone.

      The once thriving Japanese camera industry has been contracting at a rapid pace. Once proud brands like Minolta and Konica have left the market entirely, and most of the rest are struggling.

    • 0 avatar
      stuki

      And even in professional image making, value add is steadily shifting away from cameras, mechanical excellence and optics, and towards software and post processing.

      Like everyone else, Japan has become good at what Japan has been focusing on over the last couple of decades, which is building bridges to nowhere and propping up bankrupt banks, real estate owners, construction companies, labor unions, bureaucracies, and low value add, yet public space vocal, “hiptsters.” The latter may arguably have served to increase Japan’s potential for youth culture exports, but even that is being undercut by how propping up the former have resulted in noone being able to afford replenishing Japan’s stock of youth.

      Once Japan finally hits the wall, no longer able to fund continued childish economic policies, and assuming the Bank of Japan isn’t pressured into some inflationary Hail Mary; the Japanese may finally get around to liquidate all the boat anchors around the ankles of productivity they have been constructing over the past 20 years. And their working couples, earning salaries commensurate with keeping their industry competitive, may even be able to afford a child or two. But until then, once proud car and electronics makers will have no option but to decontent and settle for less than optimal engineers, as costs of both industrial labor and engineering talent is being bid up by officially supported bridge to nowhere construction companies.

  • avatar
    criminalenterprise

    Toyota’s apotheosis came at a time when Ford’s dealer prep included realigning panels to fix the sloppy gaps. They picked the low hanging fruit.

    Quality production means there’s something to sell, but everything else (PR, brand management, sales, service, advertising) is how it’s sold.

    It doesn’t help Toyota that the news cycle is currently a bit dull.

  • avatar
    mdensch

    Interesting.

    Not 48 hours ago we were reading conspiracy theories that held that the U.S. government and media were piling on Toyota because the feds are now co-owners of two of our American car companies and Toyota competes against them. Now we learn that Japan’s government and media are criticizing Toyota for the incident(s) and its handling thereof.

    So, are Japan’s government and media part of the American conspiracy against Toyota? Cynic that I am, I am sure that someone will find dots to connect.

    • 0 avatar
      xyzzy

      You nailed it. Quite frankly I felt that conspiracy post was simply an attempt by the poster to inject his conservative politics into TTAC. When I read it, the first thing I thought was, is this the same guy who posted this less than two months ago? http://www.thetruthaboutcars.com/sayonara-toyota-quality/ However to Bertel’s credit he is also posting stuff that contradicts his previous political posts.

      Anyway one of the biggest weaknesses of TTAC in the Farago era was Farago’s insistence on injecting his politics into the website whenever possible. When Niedermeyer took over I noticed a refreshing change in emphasis away from politics and toward cars. It looks to me like Bertel is still emphasizing the politics, which is too bad because when he’s not being political he’s extremely entertaining and informative.

    • 0 avatar

      You guys are confusing the messenger with the message.

      We are reporting the news. Selective reporting is manipulation. When LaHood talks like an extra on Sopranos, we report it. When Toyoda takes the stage and says nothing, we report it. When the media on both sides of the Pacific talk of a political agenda, we report it.

      There will always be some reports some people will like to hear, and there will always be some reports some people won’t like to hear. Can’t help it. We are an equal opportunity offender.

      As for politics, as long as car companies are bailed out by governments, are owned by governments, do survive only because of government handouts, politics will be inseparable from cars. Volkswagen, the company I worked for for more than 30 years, at one point had more than 100 politicians on their payroll. Covering this industry while ignoring the politics behind it would be a crime of selective reporting. Again, depending on one’s leanings, some reports will delight, some reports will offend. And again, we try to be equal opportunity offenders.

      I’m glad that you guys find what you think are conflicting reports. If you would find only praise for some makers, and constant criticism against others, we would be doing something seriously wrong.

    • 0 avatar
      mdensch

      Mr. Schmitt,

      I think I am just intelligent enough to distinguish messages from messengers. I was merely pointing out the irony that 48 hours ago we had conspiracy theorists blaming the U.S. government and media for continuing to fan the flames of this controversy for their own dubious reasons. Now we learn that the Japanese government and media are at least as critical of the auto maker as their American counterparts. This causes me to wonder whether the conspiracy buffs will rethink their position (doubtful) or expand it to somehow include this new information.

    • 0 avatar

      Here is my strictly private take on this:

      1.) Yes, there is a political agenda. There always is. In a situation like this, with unemployment at record heights, with the super-majority endangered, with mid-term elections not looking so good, then a feisty donkey would be remiss if he wouldn’t kick the elephant’s Japanese union-busting darling when the darling is down. I’m not saying that brake problems are made up. I’m saying they are milked for more than what they are worth. “Attack where your enemy is weak,” and all that.

      2.) The Japanese politicians, being politicians (and especially being left- and union-leaning DPJ politicians, as opposed to the center-right LDP) realized that danger and warned Toyota to not fall into the trap. These warnings were not heeded.

      3.) Toyota ignored the danger and the warnings, made an absolute mess out of it, and walked with both feet into the trap.

  • avatar
    Jimal

    As someone noted in another thread, it isn’t the crime that gets you, its the cover up. I don’t think the recall itself has hurt Toyota nearly as much as how they’ve handled the situation. There was an opportunity at one point for Toyota to actually reinforce its reputation for quality by getting in front of this issue. For whatever reason they did not.

    Audi was able to recover from an issue that was ultimately not of their making, but it took years. I don’t think Toyota is going anywhere. Sales will suffer for a while but they’re long from dead.

  • avatar
    Billy Bobb 2

    Any guesses as to when the first “fully recall performed, pedal shimmed, floor mat modified” Camry roars through a plate glass storefront?

    Then what, Toyoda-san?

    • 0 avatar
      Hippo

      Not much of a problem if it comes out how much the UAW and ACORN paid the driver. LOL

      At this point there is so much conflicting info out there that it is hard to know what to believe based on facts. If it comes down to trust it is much easier to trust Toyota to properly repair the cars, then to trust the UAW and the brigade of administration funded bloggers.

  • avatar
    Wheeljack

    I love the little aside about the “Sony timer”…in my book it’s real. I learned my lesson after buying a couple of their “Walkman” products (first a cassette version then two CD models) in sucession many years ago and every one of them failed in the exact same way – the headphone jack went out and would only provide sound in one ear. Today, you couldn’t give me a Sony product thanks to that experience.

    • 0 avatar
      John Horner

      Yep, LG and Samsung are the class act companies for consumer electronics today. Small wonder that Hyundai is giving the Japanese car makers fits.

      Toyota needs new leadership yesterday. Toyoda-san has blown it. But, one of the big problems with Japanese business culture is that it is infamously difficult to bring in an outsider to shake things up. It has been done from time to time (Nissan, Mazda), but only after companies get to death’s very door.

    • 0 avatar
      Davekaybsc

      Samsung yes, LG.. not so much. I think they are still considered to be a second tier brand. Panasonic is much stronger than LG in most areas, as is Toshiba.

    • 0 avatar
      Paul W

      A little bit of useless knowledge: the founder of Samsung and the (co-)founder of Sony went to the same Japanese university.

    • 0 avatar
      YotaCarFan

      I noticed Sony quality go downhill in the 90s. There was no “Sony Timer”; the products were inferior out of the box, and many failed within weeks of use; others failed after warranty. I had assumed it was b/c the US economy was in the doldrums and Sony was simply shipping a lower grade of product to the US market to allow dropping prices enough that they wouldn’t lose market share. However, after a couple of high-end $1K “ES” stereo receivers failed on me in quick succession I realized the company was not engineering things properly, period. They lost my business for a number of years, but the half dozen or so Sony products I’ve bought over the past 10 years have been good quality. The “Sony Timer” legend is an example of how customers allow emotions, not logic, to drive how they perceive brands (I put the timer believers in the same category as tinfoil hat wearers), and how a bad reputation can dog a company long after they get their act together.

      Samsung is good; LG is over-rated based on my experience with a $1K washer failing repeatedly and having poor engineering issues, and my experience with “GoldStar” products in the past.

  • avatar
    Robert.Walter

    I posted the following to Bertel’s “Toyota’s Prez Meets Press…Sez Nothing”, but too late, I think, to get any feedback. So I’m copying it here and would invite replies.
    ———
    1. As Bertel previously observed, a 9pm press conference seems designed less for domestic consumption and more for Wall Street before the starting bell.

    As a professional spin doctor (Junior Grade in comparison to Bertel), I agree that unless there were to be some concrete statements and some indication of a plan and timing (to be proactively revealed in a statement, before the Q&A, rather than in reactive, non-robust, answers to reporter’s questions) then the top-guy should not have appeared at all, else he risked looking weak, reactive, uninformend and not in control … more or less what we saw here.

    That said, I was reminded of many experiences in Japan where individuals tried to give the appearance of doing something, or more, or more faster, than they were actually doing … e.g. like in the Lawson, or the Kinko’s, an associate has to get something for a customer and as they walk, they do a high-speed appearing shuffle move … they don’t really move faster than a brisk walk, but they pantomime a jog (without the forward velocity) … while I always understood and respected the intent of these gestures (for those unfamiliar with it, the japanese culture is very big on gestures and symbolism that at turns, seems extremely restrained and then somewhat excessive – this is not a criticism, just a reflection on what I experienced), I did find them somewhat humourous (but also far preferable to the “whatever attitude” one finds in the West.)

    Could it be that the ToNoCo spin-meister and the head honcho are not sufficiently “westernized”, in that they don’t realize that the pantomime-routine kinda backfires if a) it comes from the CEO, and b) you use it for a western audience?
    ———
    2. Re. Toyoda-san’s bow, he didn’t hit the Olympic-level slit-my-wrists-sorry 90° deep bend, more just a curt 45° … body language didn’t seem to match-up with the severity of the situation or the words used. Bertel, what do you make of that?
    ———
    3. I was reading Bertel’s comment again, re. not sending out the CEO, but instead, at max, the head of QC to have a press-rodeo-round-up…

    IIRC, I think I noticed a progression during the last week … about 2-3 days ago the QC-guy did have a chat with the newsboys, then about a day later the COO did likewise, now the CEO/Pres.

    If they keep up at this rate, they will blow-thru Watanabe by mid-week, and then start rolling-in Toyoda-san-Sr. and Toyoda-san-double-Sr. within a week.
    ———–
    4. Mr. Toyoda received his MBA from Babson College, the same alma mater as Edsel Ford II. I don’t know Babson, so perhaps my next statement is unfair, and inappropriately groups Mr. Toyoda with EF2, but I remember people snickering that Ed didn’t go to a “real” university, because Babson was the “kind of school scions (not Scions) go to when they can’t get into the top-tier schools”…

    I don’t want to be too critical of Mr. Toyoda (as I really do have “mitleid” for him and his situation, and my japanese-language skills are essentially nonexistant, so I try to imagine walking a mile in his moccasins before I make the following observation…), but I think it was also unwise of him, in such a critical situation to take (or at least answer) questions in English …

    If you watch the AP feed, it is clear Mr. Toyoda did not understand the tense of the last question … reporter asked “should you have moved faster?”, Mr. Toyoda, hesitates, question is repeated, or translated (I only watched feed once), and then Mr. Toyoda answers the question (which I think he understood as “can you move faster?”) with “I will do my best.” (A statement which would be normal in Japan, but sounds very weak in the US.)

    Pity, because I think had he used the translator, he could have answered at his articulate best, rather than struggling as he did … I’m not sure that too many people would watch what I watched and try to think about the contextual and cultural reasons behind it, but I am pretty certain they would be left with a bad impression (did Bertel say “puke”? It is probably not too strong a word.)

    Toyota Corp. is walking a fine line now in the public consciousness between looking like liars or incompetents … they can’t afford for their CEO, in an attempt to build confidence, to leave behind a poor impression. (I’m pretty sure this performance will certainly scrub more value off the share price…)
    ——–
    5. Perhaps I am beginning to suffer from some kind of Stockholm-syndrome, because I am no Toyota fan-boy (nor Toyota-hater either), and I think Toyota Corp. has been sluggish and less than forthright, but this whole train-wreck of a situation is beginning to break my heart (in a way similar to when I saw the body of the “Clipper Maid of the Seas” lying crushed and broken in that Lockerbie field, or when the Twin Towers fell.)

  • avatar

    Robert:

    I discussed this with my Japanese wife today. She’s been in the field also. Before I stole her, she worked for a large Tokyo corporate identity company.

    Her take:
    - 45 degrees definitely insufficient for an apology, a casual greeting bows deeper ( I had to learn that at my wedding… )
    - Japanese press already says Toyoda is protecting “the family” too much instead of the company
    - English major faux-pas.

    Then she said something perplexing:

    “Didn’t you write the scripts for the speeches?”

    Me: “Sure. I wrote the scripts for the prepared statement. Then we had scripted answers for every conceivable question. We rehearsed them. We had ‘cooperative’ people in the audience who asked questions we had answers for. I even typed answers into the teleprompter when there was a surprise question. We had overly lengthy answers to kill time for when matters got iffy. You think the Japanese don’t do that?”

    Her: “There is talk that Ghosn has great script writers, but Toyota doesn’t take it seriously.”

    Hard to believe.

    I also recommended to ALWAYS use an interpreter, even, and especially when my guy could speak fluent English. He understood the question, but the translation gave him time to think about the answer (and gave me time to type furiously into the teleprompter.) And somehow, if a statement goes through an interpreter, it’s not taken as seriously. A good interpreter also can shield the guy by rephrasing the answer a bit.

    A good example is “We do our best.” As you said, standard in Japan (and btw. also in China.) In American, “I’ll do my best” comes across as dismissive, and it provokes a “I don’t want you to do your best, I want you to do the effing job right!”

    A good translator would have turned “We’ll do our best” into “We won’t rest before this problem is solved.”

    • 0 avatar
      Robert.Walter

      Thanks for the feedback Bertel; educational and very much appreciated.

      Teleprompter? Amazing! I occasionally wrote scripted remarks, but never had any teleprompter duty, much less on-the-fly revisions of same. (I bet there is something in there for your auto-bio!)

      BTW, I agree with your assessment of interpretation and response to the “I’ll do my best” statement of Toyoda-san, but would like to add I was reminded of a clueless little boy who is not quite sure what to do (very poor impression.)

      p.s. Really nice wedding photo. (Full disclosure: If it is not too “frech”, may I admit that the tails on your tux pointing out behind somehow combined form with the back angle and bowed head to cause my mind to recall an image one of those toy birds that tips its beak into a glass, absorbs somewater than tips back.)

    • 0 avatar

      Well, when this here happened, we had no teleprompter, so it was a little hard to slip comments in. We learned and had them later.

      Agree on the sipping bird comment. I felt really weird.

    • 0 avatar
      L'avventura

      While I think you are putting too much focus on the angle of the bow, but what you posted is very insightful and spot-on.

      Right now, Toyota’s major focus should be how they are presented in the US, and the angle of the bow isn’t a big a deal as the action they ultimately take. The previous TTAC article here that said he apologized, but did “nothing” hit the nail on the head.

      That press conference showed how insular and Japanese Toyota’s approach to this crisis is- most of the recalls were not in Japan, they were in the United States, taking a Japanese approach this problem doesn’t help them. The apology means nothing, especially to the American public, what they do means everything.

      And you’re right, most Japanese that believe they are fluent are never really fluent. I hope they take your advice about the interpreter when Toyota’s Inaba goes to the congressional hearings later this on the 10th and 25th. There is no question it’ll be a public lynching, and they will be fined the $16 million (small change, but expensive in negative branding terms). This still has an opportunity to get worse for Toyota.

    • 0 avatar
      YotaCarFan

      Perhaps Toyoda didn’t expect for his Q&A session to get much media coverage? I don’t watch much TV anymore, so I have no idea whether the US media gave his speech much coverage; but, if it’s anything like typical “news coverage” here in the US, I can’t imagine coverage deviated much from what I saw in the waiting room of the Toyota dealer while getting an oil change for my Lexus last week: Cue graphic of Toyota logo and the word “recall”, the talking head mentioned how many cars were being recalled, they showed press video of a Toyota car driving along a road, they showed a picture of a smashed car, then a picture of a Prius and a mention there could be a problem with it, and then they moved on to discuss the anticipated snow storm.

      My experience is US news reports rarely cover overseas events in such depth that more than a few seconds of a foreign president, let alone a foreign CEO, giving a speech makes it into the newscast. So, maybe Mr. Toyoda simply wanted to give local (Japanese) media something to quell the demands for him to formally respond. Whatever the cause, they need something with concrete plans for improving quality and a “sorry we goofed” for their recall website, which US customers *will* view, as opposed to that pathetic speech from the US Toyota rep – “we’re sorry we lost your trust”. Gag.

  • avatar
    50merc

    Well, it’s Superbowl Sunday and if my team loses I know who to blame: CBS!

    I wonder if we’re experiencing a seismic shift in public perception of Japan (or at least Toyota) as a brand. For years the common wisdom has been that Japanese cars and electronics are top quality. Toyota’s woes and the “Sony timer” urban myth (new to me, but no surprise) can take on a life of their own. If six months from now Leno and Letterman are still joking about Toyota we’ll know it has entered our popular culture.

  • avatar
    L'avventura

    There is no question that Toyota is their own worst enemy.

    Their problem is that they take a reactionary approach to PR rather then a proactive one. They don’t anticipate media reaction until it actually happens, and when it does they are scrambling. Instead of actively address potential PR issues during their crisis, compressing them into one clean story and allowing the media to move along, they drag their feet, wait till it gets exposed, and are stuck with pie on their face.

    The Prius case is the best example, it is essentially the same as Ford’s, but Ford handled it with well:
    http://www.thetruthaboutcars.com/breaking-toyota-to-recall-270k-2010-priuses/

    Ford assures “To be clear, the Fusion and Milan Hybrids’ brake system maintains full conventional brakes and full ABS function”, and depressing the pedal further would initiate hydraulic braking.

    Let’s compare to how an individual from the Chicago Prius owners club describes it to a local ABC affiliate:
    http://priuschat.com/news/priuschat-legend-makes-chicago-news?s=7e9f1f190ba31280c7e5cf95e8b59d98

    This non-professional owner explains it better, and does a better job communicating to the public the situation, then Toyota’s own inept PR people. The Prius club owner doesn’t say a “temporary loss of braking up to a second”, he says clearly if that the users braking capability is there if you press your foot down (similar to Ford’s press release).

    Ford announces a “customer satisfaction program”, which is basically a recall, but by acting on it early they don’t have to deal with the negative press, Toyota, having identified the problem could have done the same thing in January, or when the Detroit Bureau first contact them. They could have quietly handled the problem proactively so that it didn’t become a PR mess.

    Moreover, when the acknowledged the problem last week they should have had Toyoda apologize at the same conference, and annonce a recall. Toyota wants to do a optional/voluntary recall, and call it something like Ford’s”customer satisfaction program” so they are delaying the announcement, but at this point it doesn’t matter, the media will look at any move cynically and by not giving brevity to the negative news its giving this Toyota Recall ‘stickiness’ in the news.

    The fact that when they finally do announce it will get national coverage they should announce a dramatic gesture along with their recall since it’ll be reported along with the negative news. Something akin to sending mechanics to your home/business and do the software update in your driveway, much like the LS400 recall in the past that actually strengthened the brand.

    It’ll be insanely expensive, but the bad PR hit could be even worse, and it would be a good gesture to regain confidence in the brand.

    • 0 avatar
      Monty

      Comparing the responses by Toyota and Ford isn’t entirely fair to Toyota, however. FoMoCo wasn’t already reeling from the previous recall fiasco’s, and fortunately for Ford their recall, oops, sorry, customer satisfaction program, was announced whilst Toyota was bungling the PR spin on the recalls. FoMoCo had the distinct advantage of quietly announcing the recall, and having it virtually ignored due to Toyota badly mishandling its PR opportunity.

      Had Ford’s action been announced during a slow news week, or after two or three other PR nightmares, the media response would have been much more vitriolic.

      What’s the sports saying? You’ve got to be lucky to be good, but you’ve got to be good to be lucky. Ford is getting the favourable bounce with almost every issue lately. I think Ford and Hyundai, not Honda, will gain market share at Toyota’s expense.

    • 0 avatar
      L'avventura

      If Ford had handled their braking situation poorly they were at risk of being pulled into Toyota’s mess as well. However, you are right in that they are certainly not in the same situation and not under the same scrutiny as Toyota are right now.

      Which makes Toyota’s response even that much more important. Ford didn’t allow that uncertainty to remain in the public consciousness, they were quickly able to respond so that when the news hit it was with the assurance that there was a fix and they would take care of it.

      Toyota needed to do that same thing. Right now, Toyota customers know there is problem, but there is no recall. Even if Toyota wasn’t ready to do a recall at that moment, they should have said that that ‘they have a fix, and that Prius owners will get details of how to get their fix in the mail”.

    • 0 avatar
      John Horner

      Airplanes occasionally crash and kill everyone on board. Sometimes a failure of the plane itself is either a primary or a contributing cause. Boeing has had to learn how to deal with the resultant press. Perhaps this is another skill Alan has quietly brought to Ford.

  • avatar
    Gardiner Westbound

    A good lawyer never puts a question to a witness without knowing the answer.

    The sole purpose of a press conference is to deliver the desired message and feeling-state. Great effort should be directed to anticipating questions and delivering prepared answers, with rehearsed spontaneity.

    It’s the PR person’s job to have some tame reporters on deck who will lob soft questions and run out the clock, neutralizing participants more interested in being the news than reporting it.

    In my experience audience plants are risky. They sometimes mess up and are exposed, worsening a bad situation.

  • avatar
    max425

    Should one feel sorry for poor Toyoda? He takes over the reins of the company and it promptly falls over the cliff. Perhaps this is even more painful in the Japanese culture where responsibility for failure, whether deserved or not, is taken all the way to harakiri (from what I saw in a Japanese samurai movie). Of course, he didn’t get the top job in the company because his name was Latoya, either. Fate is a fickle mistress.

    • 0 avatar
      Jimal

      And “Jimal’s Law” has been invoked. Sooner or later any discussion of Japanese business or culture always ends up with someone referring to harikiri or seppuku. This one took a little longer than most but I’m writing the description for Wikipedia now.

    • 0 avatar

      Please write it! And to spare you the dreaded “citation needed,” I gave you something to link to:

      Jimal’s Law is a corollary to [[Godwin’s Law]]. The law states: “As an online discussion about Japanese business or politics grows longer, a participant will inevitably mention [[hara-kiri]] or [[seppuku]]. At this point, the participant mentioning the ritual suicide automatically loses the argument, and the discussion disintegrates.”
      Jimal’s Law received its name from a person with the [[alias]] Jimal. He mentioned it at various occasions on the website [[The Truth About Cars]]. Jimal argued that overuse of [[clichés]] from Samurai movies should be avoided, because it destroys the discussion and can, in severe cases, lead to nausea.

    • 0 avatar
      BuzzDog

      @bertel: +1

    • 0 avatar
      max425

      I’ll use the phrase “falling on one’s sword” in future. It seems some people are sensitive to “harakiri”.

    • 0 avatar
      Jimal

      Jimal’s_Law

      Done. Lets see how long it lasts. Thanks for the copy; it really speeded up the process.

    • 0 avatar

      When are a culture’s unique practices considered acceptable to shed light on a business or political decision? Should we never mention salarymen, window jobs, or saving face when discussing Japan Inc.?

      You mentioned Wikipedia and Bertil offered TTAC as a citation. That may not be sufficient for the self-appointed and self-congratulatory Wikithorities. My account at Wiki has been blocked for a couple of years because I posted an article about a Wiki administrator, an AGW activist, that was well sourced, but critical. The explanation given for my blocking was “user hates Wikipedia”.

      I’ve been appealing the block. While doing so I’ve learned that Wiki administrators consider TTAC and other enthusiast sites to be “car fan sites” and not “useful” sources.

      The appeals procedure at Wikipedia is like something out of the Inquisition, Star Chamber or Soviet show trials. Basically, you’re supposed to admit what you did wrong and promise to never do it again.

      Reference has been made to Godwin. I’ve been online since before Godwin coined his “law” and I’ve watched it be transformed from a clever comment on how debates devolve into a heckler’s veto. Here’s an example:

      In the Wiki appeals process, their user guide suggests showing how you can contribute to Wikipedia in the future. In one of my appeals, I explained that I was hoping to contribute an article about notable Jews in the auto industry, including people like Siegfried Marcus, who were literally written out of history by the Nazis. I mentioned how correcting such historical revisionism should appeal to Wikipedia, with its stated commitment to accuracy.

      An administrator replied by saying that my reference to Nazis and censorship was a “telltale sign” that I wasn’t likely to cooperate in their reindeer games. This inferential citation of Godwin shows how silly it’s become. I was talking about real Nazis, really censoring the historical record, and it was contextually related to what I was discussing and the Wikithority somehow read it as me calling him a Nazi and accusing Wikipedia of censorship (which it is most certainly guilty of but that’s another day and another, albeit related, argument).

      It’s telling that Godwin’s and Jimal’s laws posit a statute of limitations on using phrases related to the Third Reich and Imperial Japan, but it’s still cool to make fun of Americans, SUVs and penis enhancers. Some cliches are more politically correct than others.

    • 0 avatar
      dkulmacz

      max425@2:26 +1

      I’ve used the phrase ‘fall on your sword’ more times than I’ve ever used the H-word or the S-word combined. I don’t consider the sentiment culturally specific, the other words just give a bit of local flavor.

    • 0 avatar
      Robert.Walter

      Is it really a law, or more like a corollary?

    • 0 avatar

      According to Wikipedia, it’s a corollary …

    • 0 avatar

      Ooops, Jimal’s Law has been removed by Accounting4Taste. Reason “Blatant Hoax.”

    • 0 avatar
      Jimal

      I dunno. I just checked and the link still works.

  • avatar

    I think that Toyoda’s press conference represented an important shift in Toyota’s response. What they tried to contain as an American problem, putting Lentz and other geijin faces out in front, finger pointing at CTS, a US supplier, has started to cost Toyota some face in the JDM.

    Whether or not the response will be adequate, I think that the press conference shows that Toyota’s leadership is recognizing the seriousness of the problem or at least recognizing its potential to harm the parent company and the Toyoda family. The fact that the problem is increasingly taking on a Japanese face reflects that concern.

    Toyota had nothing but success for three decades. Perhaps that success has left the people at Toyota with little experience and skill to cope with adversity.

    As an aside, it’s interesting that there are some pretty significant car companies that are still owned or controlled by their founding families, the Toyodas, the Fords, and the Porsche/Piech family come to mind. I don’t know what kind of stake in Honda that Soichiro’s family retains. I do know that the Morgan’s still own Morgan, but while it’s a significant car to enthusiasts, Morgan’s total output annually is probably less than what one Toyota plant produces before lunch.

    • 0 avatar
      Robert.Walter

      Adds to your list:
      Suzuki
      Peugeot (Peugeot-clan)
      Fiat (Agnelli-clan)
      Paccar (Pigott family)
      BMW (IMHO, Quandts count as a re-founding family as they saved the Company and raised its game.)

      Can’t really speak to the chinese companies … too many … ownership too murky.

      In the for grins category: Tesla, ZAP

    • 0 avatar

      Robert,

      I was going to mention the Quandt’s but in writing they slipped my mind. As I recall, the Quandt family hasn’t always seen BMW as a going concern. They may have sold their interest if not for the success of the 1600/2002.

      Enzo Ferrari’s son Piero, by his mistress, owns 10% of Ferrari and is a VP of the company.

  • avatar
    fred schumacher

    The Toyota fiasco has the behavioral characteristics of a non-linear chaotic system, that is, it is sensitive to initial states and inputs have amplifying outputs.

    The initial state is Toyota’s perceived quality. Following the sociological dictum that something is real if it is real in its consequences, it is the perceived, not absolute, quality that is important in regards to Toyota. This perception engenders in management, workers, dealers, and consumers that perfection is the default condition and that any flaws are so aberrant as to be unbelievable.

    Whereas with other manufacturers flaws are to be expected and accepted, with Toyota the possibility is perceived as being too remote to consider. There is tremendous inertia in that system, with people questioning themselves, rather than the vehicle or design, if something untoward happens. However, once the dam breaks, reaction increases at exponential rate and is unstoppable, that is, inputs have amplifying outputs.

    As a retired farmer and millwright, I know that everything breaks. It is only a matter of when, not if. With the increased use of complexity as a problem solving tool by the auto industry, I think we’re in for more disastrous flaws, while at the same time, average reliability continuing to improve. The frequency of error will be lower but the amplitude will be greater, a good description of Toyota’s problem.

  • avatar
    97escort

    Chrysler leads Toyota in brake technology:

    http://online.wsj.com/article/SB10001424052748704197104575051261910244700.html?mod=googlenews_wsj

    “Chrysler Group began implementing the smart brake in 2003,” a Chrysler spokesman said. “We saw the opportunity to use the system as an additional security measure for the driver. When a disagreement exists between the throttle and the brake, the brake signal causes the engine controller to reduce engine power, allowing the operator to stop the car. Safety is indeed a benefit of the system but efficiency and durability are also important.”

    • 0 avatar
      educatordan

      It seems like the rational thing to do, connect the brake and throttle through the computer. Give braking precedence and lessen the possibilities of operator error.

      sarcasm on/ In fact, I want Toyota to fit that system to all Avalons being driven by former Buick customers who should have had their licenses yanked years ago. /sarcasm off

    • 0 avatar
      BuzzDog

      It seems like the rational thing to do, connect the brake and throttle through the computer. Give braking precedence and lessen the possibilities of operator error.

      Unless, of course, drivers are making the ultimate operator error and mistakenly stepping on the accelerator instead of the brake.

      As long as the absolute cause of this remains a mystery I’ll continue to wonder if this isn’t what’s actually happening.

  • avatar
    mcs

    With Hyundai getting ready to announce a full hybrid, this isn’t a good time for a Prius recall. Hyundai has a little more info about the Sonata Blue on their global Blue Drive site. They have a comparison of the Sonata Blue vs. the Camry Hybrid with 18.8 kilometers per liter for the Camry and 20km/l for the Sonata Blue. Obviously the numbers weren’t for US EPA and who knows how those numbers will go.

    Anyway, it looks like the lithium polys will give Hyundai a technical and competitive advantage over Toyota. Having a Prius recall fresh in the publics mind when the Sonata Blue Drive is announced is a stroke of luck for Hyundai and should give them a good boost.

  • avatar
    Robert.Walter

    UPDATE: CNN reporting from Japan 09:15 local time. They spoke to TMC corporate PR dept and could hear the phones ringing off the hook in the background “just trying ot keep up.” TMC PR said no recall for Prius has been announced despite rumours in the media. Apparently, TMC sent an email to US dealers effectively saying “…want to assure you that we are moving rapidly to find a solution for your current customers…” Also TMC-US is running ads in the US trying to remind customers of its 50 year history in the US.

    She also commented, as did Bertel previously, that the local media in Japan have been critical of TMC management, specifically Mr. Toyoda, for not showing leadership and acting decisively.

    After losing 1/4 of its market value over the last few weeks, and the poor showing of Mr. Toyoda in the press conference, on Friday, TMC was up by 0.9%, and Monday morning was up 1% at the starting bell in Tokyo.

  • avatar
    rnc

    Bertel – How much longer is Toyoda going to last (I mean at this point it’s almost a karma issue)?

  • avatar
    fgbrault

    I went to the NHTSA site and checked complaints for the 2008 Prius and found a number of complaints of problems with braking similar to those reported for the 2010 (e..g. braking over bumps). In one case the person complaining has a 2005 and a 2008 Prius and has had this problem with both cars!


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