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.

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Adele Berenstein

Adele Berenstein is an Experienced Customer Satisfaction Executive, recently retired from a Large Global IT Organization after a long productive management career including Sales, Marketing, Services, teaching and education center management and most recently, 19 years in customer satisfaction management. She turned around divisions with customer satisfaction problems, implemented measurable improvements and management systems, and implemented programs to prevent problems from ever affecting customers.

6 Responses to “Toyota Reputation Management hit again by new US government investigation”

  1. Frank Brinkman Says:

    Excellent post recognizing that Toyota has taken fast action in the case of the Lexus and a return to profitability. I agree it will be interesting to watch as Toyota continues to respond to market and quality issues. Toyota is expending a lot of energy to restore their image that quality is uppermost in their strategy.

    Thanks for posting this information.

  2. Adele Says:

    Thanks for your comment, Frank.

    Toyota needs to continue to publicize the actions they have taken to demonstrate they have learned their lesson and are taking proactive steps to protect their customers.

  3. Tweets that mention Toyota Reputation Management hit: new US Gov't investigation | Customer Satisfaction and Reputation Management -- Topsy.com Says:

    […] This post was mentioned on Twitter by Adele Berenstein. Adele Berenstein said: Toyota in hot water with US govt re failure of timely recall of pick up trucks with steering defects http://icio.us/zdtpii […]

  4. Amy Says:

    Excellent post recognizing that Toyota has taken fast action in the case of the Lexus and a return to profitability. I agree it will be interesting to watch as Toyota continues to respond to market and quality issues. Toyota is expending a lot of energy to restore their image that quality is uppermost in their strategy.

    Thanks for posting this information.

  5. Adele Says:

    Hi Mark,

    Thanks for your comments. I think Toyota has a way to go to improve their overall reputation. I think they are trying but they still have the wind in their face blowing them back. Each new revelation is chipping away at their very strong brand equity. I hope they persevere.

  6. Charlene Blake Says:

    With regard to Toyota SUA, sudden unintended acceleration, there remain some very tough questions for Toyota, the NHTSA, and the DOJ to answer:
    1) Why haven’t Professor David Gilbert’s and embedded systems expert Michael Barr’s findings of an electronic fault without adequate fail-safe in the Toyota ETCS been fully examined?
    2) Why hasn’t Dr. Antony Anderson’s logical debunking of NHTSA’s 1989 driver error determination of SUA been considered?
    3) Why haven’t the Toyota internal documents of Toyota Whistleblower, Betsy Benjaminson, been acknowledged and accepted as evidence in Toyota’s criminal investigation? Toyota engineers admit concern about the “ghost in the machine” and the unpredictability of the performance of the ETCS.
    4) Why are the Toyota owners both the field-testers and fail-safe applicators for their own vehicles’ questionably-designed ETCS?
    5) Most importantly, how many more deaths have to occur before someone takes charge of permanently eliminating the unacceptable risks to both the Toyota drivers and those they encounter on the roads and highways?

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