Recent quality problems at Toyota in the US may damage the company’s reputation, and slow its growth.
An internal presentation obtained by the Detroit Free Press, showed that executives are concerned that the company has grown due to its reputation for quality, but recalls rose dramatically in 2005 and 2006.
In the presentation, president of Toyota’s North American engineering and manufacturing units, Seiichi Sudo, attributes the quality problems to design issues, caused largely by high project workload.
Another chart reportedly showed that warranty issues have declined, suggesting that quality is being maintained. “However, chronic issues still exist,” said the report.
The Detroit Free Press noted that Toyota had fewer recalls in the US in 2006 than Chrysler, Ford, GM, Nissan, Honda or Volkswagen.
However it did have several high-profile recalls last year. In May it recalled a million vehicles worldwide and in January, recalled 533,000 Tundra pickups and Sequoia SUVs produced at its Indiana factory because a flaw could make them difficult to steer.
The Lexus brand ranked second and the Toyota brand fourth in the 2006 JD Power Initial Quality Study for fewest problems per vehicle after three months on the road. Porsche and Hyundai were first and third, respectively.
Speaking to Reuters at the Chicago Auto Show, Toyota Motor North America president Jim Press said the recent recalls will push Toyota to strive for higher quality. The recalls of cars and trucks, which peaked between 2003 and 2005, “scared us to the point where we’re re-energised on quality, and you’re going to see continuing bigger efforts to actually make the margin and the gap bigger,” Press said.