Nice New Toyotas

The Toyota Motor Corporation is the largest car manufacturer in the world, but they didn’t get there by building cars of an inferior quality. Toyotas have long been considered the benchmark by which all other makes are judged, but in recent months that advantage has largely disappeared.

Toyota’s problems are being blamed on a number of factors including a relentless quest to displace General Motors as the world’s largest car company, management infighting where Toyoda family members battled to regain control of the company and a management disconnect between what takes place in Japan and elsewhere in the world.

But I’m not writing about these problems specifically. Rather, what must Toyota do to regain the customer’s trust in their products?

As an automotive writer who attends auto shows, meets with industry leaders and keeps his pulse on what customers are thinking about through my Auto Trends website, I can offer the following suggestions on how Toyota can win back customers and put its present crises behind it:

Come clean. It isn’t enough for Akio Toyoda to offer one thousand apologies for Toyota’s screw ups. While having the chairman of the company take responsibility is laudable, ‘fessing up can go much further. Specifically, Toyota has to admit where it went wrong even at the risk of huge lawsuits. Toyota will end up paying hundreds of millions of dollars in fines and legal settlements, but they’ll also save themselves billions in lost sales.

Shake up. Toyota is much too concentrated in Japan. The entire board consists of paternal, Japanese executives who understand the home market but are out of touch with what goes on in the rest of the world. Google the name Jim Press and see what he has to say about Toyota management. You’ll learn that the company is great at selling vehicles, but not at identifying problems quickly. Someone needs to shake up the way the company is managed and run.

Get real. Toyota has a perceived culture of not being transparent and some have gone on record as saying that the company covers up it problems. An AP investigative report accused Toyota of this much, something Toyota has to counter. They can do that by always letting customers know what is going on and avoid posturing. If you’re believable, customers will trust you. If not, good-bye.

If Toyota continues to be defensive, even combative, people will see through it and look elsewhere for their new cars. Volkswagen and a resurgent General Motors are closing back in while Ford, Honda and Hyundai are demonstrating that their vehicles are certainly worth a look.

Matthew C. Keegan

You may be asking yourself this question lately especially in light of the news that several Toyota models have been recalled while a Lexus model failed an important Consumer Reports safety test. These are some of the worst days in the history of Toyota, challenging times for the world’s largest auto maker.

But should you avoid Toyota altogether? As editor for Auto Trends and The Auto Writer and as a columnist for a pair of regional print publications, your concern is something I hear of occasionally. Editors are always concerned about covering a potentially unsafe vehicle while some readers wonder if they should avoid Toyota completely.

It can be easy to make your decision based solely on what you’re hearing in the news. Some of what has come out about Toyota is valid, but opportunists have gotten in their bashes too. You need facts and an objective voice, something I will try to provide as someone who doesn’t have any “skin in this game.”

Fact #1 – Toyota is not as reliable as they once were. This apparently is true as the company grew so fast that they put aside some of the warning signs indicating certain problems were surfacing. Reports at this time are unclear, but we think Toyota may have known that their accelerator pedals were a problem as far back as 2006. While all manufacturers have to deal with quality issues at some level, how they handle problems is telling: are they coming clean or burying the truth?

Fact #2 – Toyota quality remains high overall. Yes, absolutely. Many consumer surveys and most automotive analysts agree that when it comes to the quality and value of Toyota vehicles, Toyota is at or near the top. Honda, Ford, Hyundai and Buick are among the brands which have fared well in recent years, while Toyota continues to score well across its Toyota, Lexus and Scion lines.

Fact #3 – Some of the criticism appears exaggerated. Unfortunately, this appears to be so. Much has happened over the past few months to cause worry for current owners and for those shopping for a new Toyota. Stories of a runaway Lexus flying off the road and killing all four occupants in California and news that a certain Toyota Prius had trouble stopping on the expressway is national news. The first story is valid, the second is doubtful. And, some members of the press are smelling blood and seem to be looking for a Pulitzer Prize. In any case, reading up on these stories can tell you much including whether claims are valid or are being trumped up.

Fact #4 – Customer sales remain strong, so Toyota will still be around. Toyota’s bad news is good news for buyers who aren’t worried that their accelerator pedal is going to get stuck, their SUV flip over or some other problem surface. To win back customers while assuring current, but nervous owners that they’re here for the long haul, the automaker is offering unprecedented discounts and financing to win your business. In March 2010 that translated to some of the strongest sales for Toyota as customers saw a bargain and decided to make their purchase.

My personal disappointment with Toyota parallels that of what some other people in this industry are experiencing: we long believed Toyota represented some of the best cars in the industry, even buying their products. But we’ve also discovered an insular culture, one that has greedily jumped to the top of the industry while stupidly ignoring problems, some quite serious.

Perhaps the one question to ask yourself is this one: Can I trust Toyota to provide me with a safe and reliable vehicle, one whose value has not been compromised by the latest recall or rumor? If you feel satisfied with your answer, then you’ll know what direction to take.

Matthew C. Keegan