Polishing Toyota's Tarnished Image May Take Time
Toyota owners have been traveling a rough road lately. For days, the news has been filled with frightening reports about stuck gas pedals and faulty brakes. Toyota, long revered for the quality and reliability of its products, has been recalling millions of vehicles for repairs.
The media coverage has been extensive, even though analysts have tallied only 19 deaths since 1999 because of sudden acceleration problems related to sticky gas pedals.
That's a very small number compared with total highway deaths. This year, safety experts estimate roughly 37,000 people will die on U.S. roads. Most highway deaths are related to speeding, distractions, intoxication or poor road conditions.
But the Toyota story is attracting attention because the company was long seen as the gold standard for manufacturing quality. Moreover, its handling of the recalls has been heavily criticized. Government regulators have been getting reports of gas pedal problems for many years, but it wasn't until last August — after an acceleration-related crash killed four people in California — that Toyota launched a massive recall.
In addition, the Toyota news comes at a time when many people are unhappy with big corporations. In recent years, big banks and mortgage companies have sunk into deep trouble or even collapsed because they allowed the quality of their loans to deteriorate so much.
Now Toyota, a company that previously had the highest standards of quality, may have made missteps. In addition, the National Highway Traffic Safety Administration, which tracks auto safety-related complaints, appears to have failed to warn the public about Toyota's accelerator problems. Critics say that in recent years, the agency has lacked the leadership and funding needed to aggressively monitor safety.
On Friday, Toyota's president, Akio Toyoda, held a news conference in Japan to try to rebuild trust. He said he was apologizing from the bottom of his heart, but added, "Believe me, Toyota cars are safe."
It can be tough to difficult to win back buyers once they've had a bad car experience. Detroit automakers turned off a generation of consumers in the 1970s and early 1980s by making flawed cars such as the Ford Pinto and Chevy Citation.
Analysts have been recommending Toyota move quickly to fix the problems and start to offer price incentives to lure customers back into showrooms.
But automakers in Detroit, South Korea and elsewhere already are using the recall to try to steal customers from Toyota. They have started offering low-interest financing, cash-back deals and other incentives to disgruntled Toyota owners.
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LIANE HANSEN, host:
NPR's senior business editor Marilyn Geewax joins us now to explain why the Toyota recall has gotten so much media attention.
Good morning, Marilyn.
MARILYN GEEWAX: Good morning, Liane.
HANSEN: Put the story in perspective for us. Are these serious problems with pedals and brakes?
GEEWAX: We want to be careful not to be sensationalistic about this and we certainly dont want to needlessly frighten Toyota owners. But when you look at this strictly as a car crash story, it really, in a way, isnt that big of a deal. It's pretty much believed that there have been 19 people whove been killed over the past decade because of sudden acceleration problems with their sticky gas pedals.
And for the 19 families, thats certainly horrible. But it's a very, very tiny number when you look at all of the highway deaths. This year highway officials expect probably 37,000 people are going to die on U.S. roads. Thats about 100 people a day. And it's only very, very rarely that anyone dies because of faulty pedal or bad brakes in a Toyota.
HANSEN: So why is this story getting so much coverage?
GEEWAX: Well, there's other ways of looking at this story. Toyota had been the gold standard among manufacturers. It was so known for its quality. And now we see that there are chinks in that armor, or whatever you want to call it, that we're starting to wonder about the quality of this company and also the way theyve been handling it.
There've been reports of acceleration problems for years. but it seems that it wasnt until last August, when there was an acceleration-related crash in San Diego that killed four people, thats when Toyota finally started to move towards a massive recall. So a lot of customers buy Toyotas specifically because they want quality and they know of the company's reputation for doing a good job. And now they're sort of shaken. If it turns out that Toyota really did know about these fatal accidents for a long time and did nothing about it -that really is a big story.
HANSEN: Where were the government regulators in all this? Did they do enough to protect consumers?
GEEWAX: Well, Liane, thats another problem. So we have the National Highway Traffic Safety Administration, which people often call NHTSA. They were supposed to keep track of auto safety-related complaints, like the ones we've seen about the sticky gas pedals. But critics are saying as far as being watchdog, this agency was napping. There are complaints that in recent years the agency has lacked leadership, it's failed to aggressively monitor safety concerns. So thats a whole another area of coverage.
HANSEN: Do you think Toyota will ever be able to recover the trust of consumers and investors?
GEEWAX: Well, they're certainly going to try. On Friday, the company's president held a news conference in Japan and he said he was apologizing from the bottom of his heart. But, you know, it can be really tough to win back people once they've had a very bad car experience.
Detroit automakers turned off a whole generation of Baby Boomers. Remember back in the '70s and early '80s they made cars like the Ford Pinto and Chevy Citation and that actually drove a lot of people towards trying foreign automakers.
So, Toyota, if it doesnt want to have itself get in that same kind of position, it's got to move very quickly to fix these problems. But, you know, this is a company that had a reputation that was so good for so long, that there's a lot of goodwill that's still out there. So it's entirely possible they could shake off this episode and get the problems fixed quickly.
But at the same time, dont forget that there are lots of automakers in Detroit, in South Korea and elsewhere, and they're seeing this as an opportunity. So we're already starting to see people offering low-interest financing and other kinds of incentives to try to win over those disgruntled Toyota owners. So I think we know that this story is going to have a long way to go before we see just how much damage may have been done to the world's largest automaker.
HANSEN: Marilyn Geewax is NPR's senior business editor. Thanks a lot.
GEEWAX: You're welcome. Transcript provided by NPR, Copyright National Public Radio.
