Post by TonyV on Jan 28, 2010 1:14:03 GMT -5
Last Updated: January 28. 2010 1:00AM
Daniel Howes
Toyota missteps give rivals a leg up
Toyota Motor Corp.'s recall crack-up is more than a crushing blow to the Japanese automaker's sterling reputation for quality.
It spells opportunity for Detroit, starting with a resurgent Ford Motor Co. and a post-bankruptcy General Motors Co. looking to capitalize on a slowly improving economy and a faint Buy American sentiment potentially turbo-charged by Toyota's latest action.
And that's just for starters.
The timing of this bombshell is as good for Toyota's rivals as it is bad for the automaker. It is fresh evidence the ostensible juggernaut is struggling under new leadership to bury nagging quality problems, to manage financial adversity and operational overstretch, to fend off increasingly successful challenges to its car and truck business.
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Bottom line: They're not used to this kind of PR-legal-sales-and-marketing challenge at the Big Red T -- not in dealerships across the country, not at headquarters in Southern California and New York, not at the mothership back in Japan's Aichi Prefecture.
Nor is Toyota known for giving its competition such a clear shot to exploit. But it has, and my guess is that the metastasizing mess has come in a way that competitors will quickly try to use to their advantage in a post-recession car market where every sale counts.
Ford also plans to target disaffected Toyota consumers. The Blue Oval expects to let its products speak for themselves, according to recent independent surveys that put Ford quality ahead of Honda and on par with Toyota.
Wednesday, GM said it would offer a monthlong sales incentive to owners of Toyota and Lexus vehicles because GM dealers and employees had received scores of calls and e-mails from Toyota owners seeking help.
And why not?
It would be hard to overstate the potential impact of Toyota's stunning order to stop sales and production of eight models until an adequate fix is found to sticking accelerator pedals. Depending on the fallout and new details that may emerge, the move threatens to reorder, at least in the mind of the buying public, the perceptions of top automotive brands.
Quality ranks to be shuffled
More precisely, it could answer who's safer and who isn't, who is actually delivering top quality to showrooms and who is resting on laurels that have long since crumbled under the weight of competition and hyper-expansion.
That could benefit not just Detroit, emerging from a decade-long detour in restructuring hell with arguably the strongest, most high-quality product lines in decades. But it also should help rival Honda Motor Co., a rock-solid if somewhat uninspiring performer, and the aggressive Hyundai-Kia Automotive Group.
Toyota's nemesis, the United Auto Workers, gets another rhetorical club to wield in its intensifying campaign to reverse Toyota's first-ever plant closing. Wednesday, the UAW and the Teamsters said they would today protest outside the Japanese Embassy in Washington against the closing of Toyota's NUMMI plant in California.
And, yes, Toyota's massive actions -- the recalls of a total of 6.5 million cars and trucks, the temporary shutdown of six assembly plants, a stop-sales order on eight models -- represents a potential gold mine for plaintiffs' lawyers looking for their next big target.
If evidence emerges that Toyota has long known about the problems, first blaming misplaced floor mats and then slow-walking notification of the public, bad PR will be the least of its concerns. Congressional hearings -- under consideration by Rep. Bart Stupak, the Michigan Democrat -- and class-action lawsuits aimed at the automaker's more than $30 billion cash hoard will be more like it.
Toyota's setback shouldn't come as a surprise. Because the hagiography of its trend-setting Prius hybrids, its greening reputation and the deep problems of its Detroit rivals obscured the fact that Toyota was expanding faster than its people, processes and engineering could keep up.
It showed. Its Tundra full-size pickup, aimed straight at the heart of Detroit, debuted at the wrong time in the economic cycle and barely threatened Ford's F-Series, GM's full-size trucks and Chrysler Group LLC's Dodge Ram. Its once bullet-proof cars are proving to be anything but.
Woes built over time
In 2007, before $4-a-gallon gas, the global financial meltdown, the credit crunch and the bankruptcies of GM and Chrysler, the editor of the allegedly "Japanese-loving" Consumer Reports stunned Toyota and apologized to readers for recommending the problem-plagued Camry V-6 sedan.
He also said the magazine had decided new Toyota models could no longer be given the benefit of the doubt -- or its prized "recommended" label. And Toyota's V-8 powered Tundra four-wheel drive pickup was labeled "unreliable" by the magazine, the unofficial bible for discerning car buyers.
Two years before that, the global industry's gold standard for quality recalled more vehicles in the United States than it sold in the United States. There have been running customer complaints about sludge in its engines and, now, mounting federal skepticism over Toyota's response to the unintended acceleration probe and its handling of the recalls.
That's a whole lot of not good for any automaker, whatever its name or its hometown.
Daniel Howes
Toyota missteps give rivals a leg up
Toyota Motor Corp.'s recall crack-up is more than a crushing blow to the Japanese automaker's sterling reputation for quality.
It spells opportunity for Detroit, starting with a resurgent Ford Motor Co. and a post-bankruptcy General Motors Co. looking to capitalize on a slowly improving economy and a faint Buy American sentiment potentially turbo-charged by Toyota's latest action.
And that's just for starters.
The timing of this bombshell is as good for Toyota's rivals as it is bad for the automaker. It is fresh evidence the ostensible juggernaut is struggling under new leadership to bury nagging quality problems, to manage financial adversity and operational overstretch, to fend off increasingly successful challenges to its car and truck business.
Advertisement
Bottom line: They're not used to this kind of PR-legal-sales-and-marketing challenge at the Big Red T -- not in dealerships across the country, not at headquarters in Southern California and New York, not at the mothership back in Japan's Aichi Prefecture.
Nor is Toyota known for giving its competition such a clear shot to exploit. But it has, and my guess is that the metastasizing mess has come in a way that competitors will quickly try to use to their advantage in a post-recession car market where every sale counts.
Ford also plans to target disaffected Toyota consumers. The Blue Oval expects to let its products speak for themselves, according to recent independent surveys that put Ford quality ahead of Honda and on par with Toyota.
Wednesday, GM said it would offer a monthlong sales incentive to owners of Toyota and Lexus vehicles because GM dealers and employees had received scores of calls and e-mails from Toyota owners seeking help.
And why not?
It would be hard to overstate the potential impact of Toyota's stunning order to stop sales and production of eight models until an adequate fix is found to sticking accelerator pedals. Depending on the fallout and new details that may emerge, the move threatens to reorder, at least in the mind of the buying public, the perceptions of top automotive brands.
Quality ranks to be shuffled
More precisely, it could answer who's safer and who isn't, who is actually delivering top quality to showrooms and who is resting on laurels that have long since crumbled under the weight of competition and hyper-expansion.
That could benefit not just Detroit, emerging from a decade-long detour in restructuring hell with arguably the strongest, most high-quality product lines in decades. But it also should help rival Honda Motor Co., a rock-solid if somewhat uninspiring performer, and the aggressive Hyundai-Kia Automotive Group.
Toyota's nemesis, the United Auto Workers, gets another rhetorical club to wield in its intensifying campaign to reverse Toyota's first-ever plant closing. Wednesday, the UAW and the Teamsters said they would today protest outside the Japanese Embassy in Washington against the closing of Toyota's NUMMI plant in California.
And, yes, Toyota's massive actions -- the recalls of a total of 6.5 million cars and trucks, the temporary shutdown of six assembly plants, a stop-sales order on eight models -- represents a potential gold mine for plaintiffs' lawyers looking for their next big target.
If evidence emerges that Toyota has long known about the problems, first blaming misplaced floor mats and then slow-walking notification of the public, bad PR will be the least of its concerns. Congressional hearings -- under consideration by Rep. Bart Stupak, the Michigan Democrat -- and class-action lawsuits aimed at the automaker's more than $30 billion cash hoard will be more like it.
Toyota's setback shouldn't come as a surprise. Because the hagiography of its trend-setting Prius hybrids, its greening reputation and the deep problems of its Detroit rivals obscured the fact that Toyota was expanding faster than its people, processes and engineering could keep up.
It showed. Its Tundra full-size pickup, aimed straight at the heart of Detroit, debuted at the wrong time in the economic cycle and barely threatened Ford's F-Series, GM's full-size trucks and Chrysler Group LLC's Dodge Ram. Its once bullet-proof cars are proving to be anything but.
Woes built over time
In 2007, before $4-a-gallon gas, the global financial meltdown, the credit crunch and the bankruptcies of GM and Chrysler, the editor of the allegedly "Japanese-loving" Consumer Reports stunned Toyota and apologized to readers for recommending the problem-plagued Camry V-6 sedan.
He also said the magazine had decided new Toyota models could no longer be given the benefit of the doubt -- or its prized "recommended" label. And Toyota's V-8 powered Tundra four-wheel drive pickup was labeled "unreliable" by the magazine, the unofficial bible for discerning car buyers.
Two years before that, the global industry's gold standard for quality recalled more vehicles in the United States than it sold in the United States. There have been running customer complaints about sludge in its engines and, now, mounting federal skepticism over Toyota's response to the unintended acceleration probe and its handling of the recalls.
That's a whole lot of not good for any automaker, whatever its name or its hometown.