Toyota’s Reputation Management efforts took another hit with a new investigation by the US Government National Highway and Traffic Safety Administration. It appears Toyota stalled on a recall concerning a steering defect for Toyota pickups, T100s, and 4Runner SUVs built between 1989 and 1998. The steering problem had been identified in 2004 and recalls were done in Japan but Toyota failed to alert the US authorities for as much as a year.
Here’s an ABC News Video on this topic
Toyota has already paid a maximum fine of $16.4 million for a delay in recalling Toyota vehicles for an acceleration problem. This new problem may lead to additional fines.
Toyota has been struggling to regain consumer confidence with advertising and promotional pricing. Toyota has spent $1.1 Billion in recall expenses and estimates it lost $800 Million in sales. It also faced large incentive costs to try to spur sales.
There has been some good news lately for Toyota.
1. Toyota posted an improvement in its profit and sales compared to last year in its most recent earnings reports. India and China shows robust sales. Global markets have certainly helped Toyota.
2. Consumer Reports recently rated the Toyota 2010 Lexus GX 460 SUV a ‘Don’t buy’ designation due to electronic stability problems that caused the rear of the SUV to slide out in a routine emergency handling maneuver. Toyota took the car off the market and worked to resolve the issue. A software upgrade was provided as part of a recall and Consumer reports retested the SUV in the same emergency handling test. This time the 2010 Lexus GX 460 handled properly. Consumer Reports has now removed the ‘Don’t Buy’ designation and provided proof of the improvement in a video.
Toyota’s reputation still needs improvement to restore customer confidence and satisfaction. Current actions are clearly moving in the right direction. But they continue to be plagued with past failures and a need to improve testing before releasing products to the public. The Toyota efforts to improve its customer satisfaction will be interesting to watch.