Toyota: Illusions Of Trust, Gone

Based on the emails I’ve been receiving from TrueDelta’s members, I have underestimated the impact of the unintended acceleration fiasco on Toyota’s future sales. This fiasco is going to hurt Toyota, possibly for years to come. The problem isn’t that many people feel that Toyotas are unsafe. Most seem to recognize that a very small percentage of Toyotas have suffered from unintended acceleration. But they’re hearing about problem after problem, so Toyota’s quality seems to be lower. Most of all, Toyota’s public statements have seemed dodgy, and people seem to feel that they cannot trust the company to keep owners’ best interests or even their safety in mind.

In other words, they’re feeling about Toyota much like they’ve felt for decades about Detroit. That the company is focused on sales and profits rather than the owners of its cars. That Toyota does not really care about them.

The odd thing here is that many people previously felt that Toyota could be trusted more than the typical auto company. Why? Because of their reputation for reliability? Because of the Prius?

The fact of the matter is that, when car owners have had problems with Toyotas, Toyota has been at least as bad as the average car company in taking care of them. Conducting TrueDelta’s Car Reliability Survey, I hear customer care horror stories involving virtually every manufacturer. If a car has a problem you feel it should not have had out of warranty, and you haven’t been regularly servicing your car at a particular dealer, that dealer will tell the manufacturer you’re not a valued customer, and you’ll get little or no out-of-warranty assistance. This is as true of Toyota as any other make. Have a problem that requires special help, and you’ll quickly learn how little they care. Toyota’s advantage was that its cars have been (and in many cases continue to be) more reliable, so people had fewer opportunities to experience how little they really care.

Among mainstream automakers (I have less information on luxury makes), Honda seems to be better than the others in readily paying for repairs after the warranty ends, buying back troublesome cars (always with a confidentiality clause, so you won’t hear about them), and in other ways taking care of customers.

But even with Honda I don’t get the sense that they do these things because they care more. The confidentiality clause when they buy back a car indicates their true interest. They simply concluded some time ago that taking care of customers would earn goodwill and, perhaps most importantly, protect their reputation and so earn them more money in the long run. And it has. It’s simply smart business. Other car companies don’t actually care less. They just aren’t as smart in this regard.

Toyota, though, behaves no differently than GM, Ford, Chrysler, Nissan, or VW and has not in recent memory been more trustworthy than these companies. But apparently many people felt they were more trustworthy anyway. This illusion is now, in many cases, gone.

What does this matter? Well, when you trust someone to do the right thing, you don’t pay nearly as much attention to what they’re actually doing. You buy the car blindly. Going forward, car buyers will be scrutinizing both Toyota and its cars more closely. Those who want to buy a car with a minimum of research and thought are now much more likely to go elsewhere.

Michael Karesh owns and operates TrueDelta, an online provider of auto pricing and reliability data