Rick Raw: Toyota Loses Customer Confidence–Greed Driven Cost Cutting Results in Lower Quality Cars

By Rick Grant Commentary rickgrant01@comcast.net

After the news broke of Toyota’s sticking gas pedal recall, affecting millions of the company’s best selling cars, the mighty Japanese automobile maker had to shut down production and the sale of its inventory. The manufacturing titan went from selling the most popular car in the world, the Camry, to dead-in-the-water, overnight.

As of Feb. 1, Toyota announced that it is sending out repair kits to Toyota dealerships. Now, the owners of millions of cars will have to get on a long waiting list to get their cars repaired at their dealership.

Meanwhile, Toyota owners have three choices: Either wait in line (it take months) for an appointment to get their car fixed, park it and rent a car, or trade it in for an American car. For the largest car company in the world, this is a mega-disaster–a nuclear explosion of public relations.

It will take thousands of man hours to fix over 4 million cars already on the road. Worse still, Toyota dealers can’t sell their inventory of cars with the defective gas pedals until they are modified, after they fix the customers cars.

The gas pedal issue uncovered Toyota’s surreptitious campaign to expand as a profit motive–a purely greed driven decision. To do this, the company decided to start using cheaper parts from suppliers other than the one’s they had used in the past. The consequences of this bonehead move by Toyota’s top executives has lowered the quality of the Toyota brand–it’s number one selling point.

To boost profits, Toyota’s beady-eyed bean counters went on a frenzy of cost cutting measures without considering the consequences of wrecking their reputation for quality and dependability. The result was, since 2007, Totoya has been selling an inferior product, unbeknownst to their loyal customers.

Indeed, the gas pedal problem is just the tip of the iceberg. Owners are suddenly asking: What other sub-standard parts are lurking under the hood and body that might fail before the car has 25,000 miles. Now the company is faced with a catastrophe of mammoth proportions.
Pissed off Toyota owners are trading in their now unsafe hunks of steel for Fords and GM cars.

Ford sales are up by 25%. More significantly, people like Ford products because the company has worked hard to convince people that quality is indeed job one, and unlike GM, Ford did not take any bailout money. However, it’s taken American auto manufacturers decades to overcome their reputation for selling poor quality cars.

Toyota’s dirty little secret is rooted in lowering costs. The company moved more parts-buying overseas, away from their quality Japanese suppliers. Now, customers can see the result by comparing older Toyotas with today’s models. But it’s what you don’t see that’s worrying.

Yeah, now that Toyota has been caught cheating, the company assures its customers it will look through all its new models’ parts’ lists for potential problems caused by cost-cutting and find a fix. Right! It’s too late, most Toyota owners will get rid of their cars and buy American.

Toyota’s CEO, James Burke should step up and accept responsibility and apologize, vowing to start from scratch to rebuild Toyota’s reputation for quality and dependability. Even if that happens, It will take years to overcome this scandal.

The only way Toyota can get itself out of this mess is to reboot its manufacturing process and press the quality issue. Then, they should own up to their unwise cost cutting decision and move on. Otherwise, the brand will die a slow, agonizing death.