Toyota is working hard to on reputation management, trying to appease customers and restore customer satisfaction and loyalty.


Toyota chief executive Akio Toyoda apologized for making customer ‘uneasy’  as did the top executives in Canada and the US.  Toyota has also announced that is has found a remedy for the gas pedal problem and that parts are on their ways to the dealers to start installing in the ‘in service’ vehicles this week and to the manufacturing plants in order to resume production.

But not all customers are satisfied. Several  law suits and class action suits have been filed against Toyota, two in Canada and  others Texas. New Orleans, and California  A  series of Canadian videos describe the complaints against Toyota and CTS, the part manufacturer. To quote the a CTV article, the Ontario case deals with the following:

‘The claim alleges that Toyota and CTS either knew, or should have known, about the flaw that causes runaway acceleration in some of its vehicles.

Joel Rochon, a lawyer in Hamilton’s class action lawsuit, says the lawsuit could potentially involve “tens of thousands” of claimants in Canada. “Our concern now is that the fix is not going to the heart of the problem which we allege is a faulty computer system,” he told CTV News Channel Monday afternoon.” “This problem has been going on for years in the United States primarily, starting in 2002 with a new computer system that was designed to regulate acceleration and braking.”

A recent video post indicates that some Toyota customers from the province of Quebec may be joining the law suit started in Ontario, Canada but is going ‘national’.

The class action suit in Saskatchewan, represented by lawyer Tony Merchant, is focus on two main issues:

a. Toyota has failed to deal honestly with Canadian government officials and has downplayed the seriousness of this problem that dates back to the early 2000s. It is still uncertain if the current fix will actually fix the problem.

b. There is a fear that this recall has damaged the resale value of Toyotas (and even Lexus by association) and that the buyers should be compensated.

A  class action suit has been filed in California over loss of lives and claiming that unexpected acceleration may have been caused by computer, electronic and mechanical systems.

“In addition, Toyota vehicles are not equipped with a brake-to-idle failsafe, which many other manufacturers already incorporate in their designs. This failsafe brings the engine to idle when both the throttle is in the open position at the same time the brake pedal is being depressed.”

There is concern that the current ‘fix’ being implemented will be insufficient to resolve the  unintended acceleration issue.

A Reuters article claims that there are 10 Lawsuits in the US and Canada. Four were filed on Friday Jan 29th, 2010.

A law professor at the University of South Carolina and Director of Tort Law Studies   David Owen, said that Toyota might be at risk in those U. S.  States that impose on manufacturers the ‘duty to warn’ customers about a defect.

“The grounds to sue are that there was a design defect, regardless of what Toyota may do to mop up the consequences, and the possibility that a post-sale warning was delayed too long,” he said. “If it turned out that Toyota delayed the recall beyond the point when a reasonable manufacturer would have done so, then punitive damages in substantial amounts might be available to whoever was physically injured,” Owen added.

Some plaintiffs are claiming loss of resale value or loss of time, expense of alternate transportation to get the car repaired.

No doubt there are more law suits and class action suits to follow and some may get merged together.

I can only speak from my own experience with recalls I have been involved in with my GM cars. When I heard of the recall,l it was from receiving a letter from GM. The fix was already known. The letter advised me about the seriousness of the problem and to take the letter to my GM dealer to get it fix. The GM dealers knew about the problem and either had the parts in stock OR would order them in time to get my problem fixed.

In the case of Toyota, the fix was not known. The recall was made because the US government asked Toyota to do so and Toyota customers were left in the dark (as were the dealers) about the seriousness of the problem and the nature of the fix.

Toyota has a massive reputation management problem and credibility problem. This story will continue to unfold.

Will insurance companies who have paid claims to their clients join in the class action suits? I wonder.

As always, I welcome your thoughts, comments and observations.

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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.

One Response to “Toyota Reputation Management – Lawsuits, Class Action Suits”

  1. Frank Brinkman Says:

    Adele, I have also been watching with dread the way Toyota management has been managing this crisis in credibility… It will be sad to see this all played out over the coming months. There are reputable people that have experienced the problem that know it is not the rug or the sticking pedal.. Now, it could be a combination of sticking gas pedal and software glitch. I will not rule that out.. Steve Wozniak, Apple founder who has definite experience with software has experienced a similar glitch in his Toyota Prius. No one at Toyota is interested enough to call him back and work with him.. Like the singer who had his guitar broken by United… Toyota has closed their ears and may be driving the corporation off the cliff of customer satisfaction to wreck and ruin. Here is a link to the LA Times Business section: http://www.latimes.com/business/la-fi-toyota-wozniak3-2010feb03,0,3057333.story?track=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+MostEmailed+%28L.A.+Times+-+Most+E-mailed+Stories%29

    Thanks again for following this sad sad story.

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