Toyota: The Weakness

Stein X Leikanger
by Stein X Leikanger
toyota the weakness

"Arguably in every parameter that you can look at, the Toyota Production System is the finest product system in the world for designing and manufacturing products. They make products that people want and they do it with less resources and less time than anybody in the world. They're a magical machine." Not my words, but those of Alan Mulally, now charged with pulling a carmaker out of the swamp marshes of Fordor. Like Alan, I admire Toyota’s manufacturing processes, quality control and after-sales. But I also know their weakness…

First, to those of you who are tired of hearing what a great company Toyota is, Toyota is the world’s foremost manufacturer. Bar none. Other manufacturers must study, learn, apply and improve. That’s the only way they’ll build the war chest they need to fight back from a position of strength. Until they do, they’ll be playing a hopeless game of catch-up.

Back to Alan for a moment. Every day a 737 pumps out of the hangar at Boeing, and after a 35 minute flight it’s in revenue service. Of course, they told Mulally it couldn’t be done – ”You can’t build planes the same way you build cars!” Yes you can, and doesn’t Airbus wish they were? This was Mulally’s gift to Boeing, and in a strange game of hopscotch it could become Toyota’s gift to Ford channeled through a disciple. Bill Ford only wishes he’d thought of it sooner.

Reaching parity with Toyota– and adding a few bells and whistles of their own– is the best Ford can hope for. It’s a long shot, as ToMoCo isn’t standing still. But Mulally is a self-professed disciple of The Way and if Ford’s resources don’t run out first, he’s the man who can give it the best shot. Who would you rather have making the effort: Wagoner and Lutz in their constant states of denial, or someone who’s actually hit the bullseye already?

Mulally is already applying his knowledge to the task at hand. For example, he knows that Ford must align itself more closely with its suppliers’ best interest. FoMoCo’s suppliers are wobbling with fatigue, having been squeezed dry by their overlords. They’re so fed up they’ve started to squeeze back, exploiting the weakness of the rulers up at the Castle. Hopefully both sides will see the light before they force one another off the field of battle. Ford’s already seeking a more constructive relationship with its key suppliers, so don’t think Mr. Mulally is simply holding Thursday chat sessions.

Mulally’s also begun realigning his forces in the field, making the various divisions understand they’re answerable to High Command and that the brandmash has got to stop. That’s going to be the tough one. There are hundreds of stakeholders who will be resisting any transfer of power back to the corporate mothership. I suspect this is why Mulally insisted on being co-director along with Bill Ford. A fly on the wall would have heard this: ”I’ll do it, but only if you’re willing to rain hell on the holdouts that will be fighting my changes. You and me Bill, we’re in this together.”

Assuming Mulally can get Ford’s ducks in a row, it’s time to reveal Toyota’s weakness: a legacy. They don’t have one.

Where do Toyota owners go to proudly display their classic Toyotas to other owners? Right, nowhere. What comes to mind when you think of Toyota’s history? Nothing. Yes, 25 million Camrys sold is fantastic. But Toyota is not a brand builder. They’re blandbuilders. They’re not building dream machines. Instead, they are experts at playing the law of averages to their consumers’ satisfaction.

Without a legacy you’re not building brands, you’re building cars, you’re providing transportation. Toyota is aware of this. That’s why it’s in F1 and NASCAR. That’s why they’re pushing the envelope on alternative drive-trains, and spending without limit on Lexus. And that’s why they put the brakes on building more Scions – sensing an opportunity to harness brand cachet. They are wising up. Toyota is trying to build a legacy before their opponents notice their weakness. While we wonder whether there’s a future to GM and Ford (a pity given their past achievements), there is no past in Toyota, only a future that’s going to be better than average.

If Ford (or any of the domestics) want to take on Toyota, they’ve got to show what brand spirit is all about. Ford and GM have some choice morsels in their history, ready to be added to the mix. Of course, to do that Ford and its cohorts need to get rid of their spreadsheet ”car makers” and tune their brandlines for an exhilirating roll of the dice. Which is the topic of my next column.

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  • Finger Finger on Dec 21, 2006

    Leanne of Sanford FL (09/26/06) I bought a brand new Toyota Corolla last year. its a 2005 with 40,000 miles now. IT NEEDFS A NEW ENGINE! They are refusing to cover it under the factory warrenty or the extended warrenty that i purchased because they are saying i didn't do enough oil changes. I showed them reciepts for 6 OIL CHANGES! TOYOTA was no help and was rude to me on the phone. I am a 26 year old mother, and both me and my husband rely on the car to get to work. we cannot afford the new engine for $3,800 and still owe $15,000 on the car! I dont know what to do. Please help!

  • Cblake Cblake on Dec 30, 2006

    It is interesting to watch Toyota climb its way to the top. It is ironic that aside from the recent recalls, Toyota has not bothered to resolve its engine oil sludge problem. Instead of calling for an actual recall on these engines, it continues to blame the owners for poor maintenance. Toyota says the incidence of engine sludge is "rare", but owner reports do not indicate the same. Toyota has minimized the problem from day one. I have been in a rather unique position regarding this engine sludge malady. Over the course of six years, I have read thousands of Toyota owner accounts and compared notes. Toyota does not want to face the truth; it is hoping that the "sludge monster" fades away from public scrutiny. Indeed, there are some who are actively trying to cover up any on-going discussions of Toyota sludge. Some web sites that had thousands of posts on the issue have been hacked. Still, there are lots of Toyota owners looking for help when sludge has disabled their low mileage vehicles. Toyota itself stopped notifying the 3.3 million affected vehicle owners; many owners have revealed that they know nothing about the Customer Support Program for Engine Oil Gelation. Many of the Toyota dealerships aren't forthcoming with the information. My question is this...with so few places to go to find other similarly-affected vehicle owners, how does the public get a true sense for what is going on after the sale of the so-called "quality" vehicles? A company like Toyota has the economic means to shape public opinion about its products. Is this reality, though? Is Toyota perpetuating the myth about the high quality of its vehicles and actively working to subdue public criticism of its products? Many Toyota owners believe this is exactly what is happening. Many Toyota engine oil sludge victims have tried in vain to get Toyota's Customer Service corporate staff to honor the CSP. Toyota is making the vehicle owners jump through hoops to qualify for the repair coverage/reimbursement. This isn't what Toyota wants the public to know, though. Many Toyota owners have said that Toyota cares only about the bottom line. These same owners have endured frustration, inconvenience, and financial setback as a result of the sludge condition in their vehicles. These owners are disillusioned with the illusion of Toyota quality. Through word of mouth, they are letting other know. Corolla owners are also experiencing sludge, but Toyota has conspicously left this model off the list of affected vehicles. The vehicle owners have been reporting oil consumption problems and low mileage blown engines for years. So why isn't Corolla listed? Is it because this vehicle is Toyota's bread and butter? Is Toyota selectively including vehicles to limit the negative PR? Isn't there something wrong with Toyota's actions here? Shouldn't Toyota put its money where its mouth is and properly resolve the sludge matter for all concerned? Will the buying public find a way to openly discuss vehicle problems without censorship and spin control? Will Toyota and the other automakers allow this dialogue without interference? The new buzz words are "consumer-generated media" and such. Will the automakers devise a means of manipulating this CGM? If so, will the buying public see through it and ask tough questions? As time goes on, auto consumers will need to join together to see that their voices are heard clearly. I think that consumers will demand more than corporate hype and brand-name myths as they decide what to purchase. True quality will come from real-world experience, not corporate mantras. Do you suppose Toyota will get this? Or, will it simply be satisfied with controlling what the public does and does not know about its products? Charlene Blake