Akio Toyoda Apologized

The recent tremor in Toyota made its President Akio Toyoda pologized.  He is the grandson of the Toyota’s founder.  He is 53 years old.

The government of Japan is already helping in the damage control by ordering an investigation. 

The recall was annouced to reach 2.3 million U.S. vehicles on Jan. 21 to repair defects linked to unintended acceleration.   It has been estimated almost $34 billion loss in market value as the recall has grown to almost 8 million units worldwide.  This ain’t funny and it will surely be very painful.

What Went Wrong with Toyota?

We don’t just learn from our mistakes, but from the mistakes of others as well.  This we do not learn from school.  

The recall surely hit hard Toyota as it caused damages not just in their image in the US but in many nations as well.  But what really went wrong?  Toyota Motors may or may not agree but I learn a lot while reading the expert analysis. 

Experts say that one of the obvious reasons is Toyota Motors’ failure to adjust its corporate structure while the company grew to become the world’s largest automaker.  I’m sure Toyota is doing its damage control.  It seems they overlooked the basic fundamental followed by growing businesses and mega manufacturing companies.  Other commentatators believed that Toyota forgot what the Toyota Way is all about. Let us analyze in line with what the experts have said:

Accelerator Pedal Mechanism (car part being blamed).  As per traced records, Toyota Motors started to source back-up supplier on 1997 after a fire that hit their long time Japanese brake supplier’s factory.  They used to source only from Denso of Japan due to its high standard produced and closed ties.  Now they are also getting from CTS of Elkhart, India.  

Per sourced report, the Denso and CTS mechanisms use different wiring harnesses.  Somewhere along the way or someone from Toyota Motors had lapses in counter checking to ensure that identical parts from two suppliers were, in fact, identical.   Although the same design is being use, the fact that the CTS part apparently developed defects and the Denso part did not, suggests there were other differences. 

Management action in coordination with customer service report.   Analyst also found out that Toyota in North America still uses an old school type of reporting.  They basically did not change their system on reporting since they started operating in North America half century ago.  Toyota California did received complaints but the report may have been reported first to Japan sales headofquarters.  There the inc-charge executives may have send issues to the concerned department for a fix for a period of time.  For a while, the communication is being floated until it reaches Toyota US again.  To make it short, analyst mentioned that if Toyota Motors had an integrated headquarters in North America, with one person in charge of sales, engineering, and manufacturing, the complaints might have been communicated almost instantaneously and the fixing of the problem may not be that long as what is happening.  Thus, image damaging issues blown into proportion may have been prevented.   This is actually a management call. 

Cost-cutting against quality of products and services.  Toyota Motors surely has its reasons for the cost-cutting measures they ask of their suppliers since December of 2009.  Another reason seen was the supplier’s counter action against the 30% reduction of parts cost requested by Toyota over the next three years.   Earlier cost cutting measures was implemented around 2005. 

CTS reiterated that it complied in accordance to Toyota standards.  Surely, it will defend its image but the reality on exessive wear is inevitable.  Nonethess, Toyota Motors is doing its damage cotrol by working together with CTS on pedals that meet “tougher” specifications. 

Photos are excerpt from Google images.

Toyota recall list:

According to Toyota, production of eight models at six North American assembly plants will be stoped for the week of Feb. 1.  The models represented 57 percent of Toyota’s 2009 US sales, according to the Wall Street Journal which represets some of America’s best-selling models( Camry and Corolla). 

Toyota Cars that have the problems (to be recalled or subject to a sales suspension):

• RAV4 (2009-10 models)

• Corolla (2009-10)

• Camry (2007-10)

• Matrix hatchback (2009-10)

• Avalon large sedan (2005-10)

• Highlander crossover (2010)

• Tundra pickup (2007-10)

• Sequoia large SUV (2008-10) 

The reason for recall is due to problems with gas pedal mechanisms that may cause the accelerator to get stuck, triggering sudden acceleration.  Toyota is considering a recall of 2 million cars in Europe, as well.

Photos are excerpt from google images