Blog: Toyota troubles
Dave Leggett | 4 February 2010
I heard Toyota GB's PR man Scott Brownlee on the radio this morning being interviewed over the accelerator pedal recall. He gave a decent performance, responded clearly and confidently to the potentially awkward questions and it occurred to me that for the PR people at Toyota, it maybe feels a little bit like soldiers going off to the front line for the first time. No more phoney war. This is it; this is what we trained for. Helmets on.
This global recall on a safety-critical component has blown up like a squall out of nowhere to become the perfect storm that some commentators reckon will do great damage to Toyota. It is clearly a serious problem not to be belittled, but I wonder whether it will really do much long-term damage to Toyota sales. A lot depends on how quickly this issue is dealt with and how quickly a sense of business as usual at Toyota can be restored.
Can a reputation for industry leading quality and reliability built up over decades really be ruined overnight? A few people in the media are jumping on this particular bandwagon (and predictably taking some knee-jerk investors with them), but I'm not so sure.
For many, the idea that Toyota equals quality and reliability, even if it comes with a little blandness of product, is very deeply ingrained. It's almost a given and it will take a fair bit of shifting. I'm not saying that cannot happen, just that we're not there yet.
If Toyota can ride the initial bad PR (no escape from that) and get the pedal problem fixed quickly, the car-buying public may well view it as an outlier or blip, a one-off that was very effectively dealt with. It could even end up being viewed as a positive, a case study on how companies handle product-based PR nasties. In this admittedly optimistic scenario Toyota's image is hardly dented and a short-term hit to sales is contained.
The eventual outcome may, of course, fall somewhere in the middle with the costs and sales fallout turning out worse than Toyota is planning for, but not as bad as the worst fears. By next year it's becoming a fading bad memory; Toyota still a brand associated with generally good quality and reliability.
That word 'containment' is important. Any sense that there is more going on than just the accelerator pedal, that there are underlying quality and reliability issues at Toyota, would certainly impact long-term sales. Keep an eye on that Prius brakes situation. And things got ratcheted up a notch in the US yesterday with some politicians' comments (always be wary of politicians wading in publicly over something like this).
Toyota has perhaps had its aura of invincibility on quality punctured a little in recent years with other recalls, but it is hardly a company devoid of good processes, a laggard among its peers or one that is instantly associated with poor quality product - far from it.
We're too early into this recall to say that Toyota has royally screwed up and that's done it, reputation for quality now in tatters. Crisis management and shaping perceptions will be key. It is all still to play for, Toyota's managers and PR people very much in the heat of the battle.
Good article - below link - from special agent Coolbear looking at 'Throttlegate'. He makes some very good points concerning Toyota's overall strategic direction, cost-cutting dangers, the risks inherent in parts/design commonality across model ranges and the new emerging markets model - Etios.
I'm starting to get a small idea of the scale of things here in China, but really, I'm only scratching the surface of this vast country....