America “Hammering Down on Japan” in Toyota Crisis?
The escalating drama surrounding Toyota’s worldwide recalls has now entered a crucial stage; the company is expected to announce details of its plans to recall the 2010 Prius models. Corporate seniors are also scheduled to attend American congressional hearings.
In addition to sticking accelerator pedals, the Toyota Prius hybrid has been reported to have brake failings as well. The company failed to acknowledge the latter defect in a timely manner. According to multiple Japanese media sources, however, Toyota will soon announce a recall of the 2010 Prius hybrid, which was reported to have acceleration problems, and has already notified retailers of its decision. A formal announcement will be released after Toyota reported its recall plans to the Japanese Ministry of Land, Infrastructure, Transport and Tourism. A total of around 270,000 Prius models are estimated to be recalled in the U.S. and Japanese markets.
Toyota Stocks Dumped on Massive Scale
In an email to its North American retailers, the Toyota executive team spoke of impending repair plans regarding the braking system of the Prius model. An investigation on the possible braking defects of its luxury brand, the Lexus sedan, are also under way.
According to Reuters, the American National Highway Traffic agency has officially begun its investigation of the Prius model’s braking problems. The agency declined to comment on Toyota’s recalls, but requested details from the company before these incidents. It claims to have received 124 complaints about braking failures on bumpy ground from third-generation Prius owners; drivers have filed reports of four collisions caused by the failures as well. The agency confirmed that the investigation includes the 2010 edition. Toyota’s spokesperson conveyed Toyota’s intent to provide “full cooperation” in the investigation.
In addition, according to Toyota’s public agenda, its North America chairman is set to appear at an American congressional hearing on February 10; the hearing will most likely cover recall policies and attempt to determine whether or not Toyota attempted to cover up its product failures. Evidently, the outcome of the hearing will affect the company’s reputation enormously. The U.S. House Energy and Commerce committee will hold a similar hearing on the 25th.
With the recent pummeling of Toyota’s reputation, major automakers have been itching to end Toyota’s reign as the world's largest auto maker. Now comes their prime opportunity; following recalls, and sales and production suspensions, Toyota’s stockholders are dumping their corporate shares down the drain. $25 billion just vanished from the company’s market value in recent weeks; unsurprisingly its competitors, Honda and Nissan, experienced respective rises of 3.3 percent and 2.8 percent, as of January 28. In America, Toyota’s sales dropped 16 percent, while G.M. and Ford enjoyed growths in sales of 24 percent and 16 percent.
Auto Market is Toyota’s No More
Car-makers are racing to court Toyota’s customers. Ford and G.M. retailers are “expressing sympathy” for their Toyota counterparts, but they’re also offering $1000 coupons for Toyota drivers if they want to change gear. The German auto-giant Volkswagen, which stands just beneath Toyota and General Motors in global sales, said 2018 would be “the year we will top Toyota in the global sales market.” According to “Plan 2018,” Volkswagen hopes to sell 10 million cars worldwide, a 60 percent jump from what they’re selling now. Note that the German brand has been on the fast track lately, and does pose a legitimate threat to Toyota’s global dominance. Currently, in America, Volkswagen holds a 2 percent share of the auto market, while Toyota has 17 percent.
Companies like Volkswagen, who once wouldn’t have even thought of challenging Toyota’s firm grip on the global market, are now really a group of hyenas waiting to feast on the fallen buffalo. With such intense competition breathing down its neck, Toyota will likely lose 1 percent of its share of the American market this year.
The Korean company Hyundai, which has been doing quite well in North American markets, has also offered $1000 discounts to customers who own Toyota cars. Even Chrysler, which claimed it would not introduce any discounts on its cars for Toyota owners, will give those drivers who buy their Dodge, Jeep and Ram models $1000 cash returns starting January 29.
The Toyota recalls and subsequent “Prius” issues have been front-page stories in the American press for some time now. The U.S. media, along with the government and the House, have been echoing each other in their statements about loopholes in Toyota’s quality management system and negligent attitude toward consumer safety.
U.S. Transportation Secretary Raymond LaHood issued a statement on February 2 saying that there would be an overhaul of the security defects in Toyota cars, as well as the auto-maker’s recall procedures. The United States is even considering levying a colossal “civil reparation fine” on Toyota.
Sources also imply that Mr. LaHood has called Toyota Chief Akio Toyoda recently, informing him of “how deeply concerned the American government is on the safety issues of Toyota’s cars.” The transportation secretary said, on a public occasion on February 3, that owners of the Toyota models to be recalled should immediately stop driving their cars. Though he quickly corrected that as a mistake and took back his words, his opinion made more than just a small ripple in the auto-industry, as well as among consumers.
It’s Got Something to Do With the Mid-terms
A lot of Japanese media believe that Toyota’s predicament is a revival of the trade friction between Japan and the United States in the 1980s, pointing out that America remains noticeably hostile to Japanese businesses. The Toyo Keizai Weekly commented in an article that Toyota needs to improve its crisis reaction and management system, which has been severely undermined by a single-minded pursuit of lowering costs. There, of course, is a political scenario behind America’s “hammering down” on Toyota. The Toyo article quoted “a member of the American auto-industry” saying, “with Papa ship General Motors staggering in bankruptcy, the U.S. domestic industry is falling into anarchy. President Obama could undertake protection measures in favor of American companies to secure the mid-term elections in November. If Toyota can’t handle this right, even more sensational actions might target it.”
Nippon Keizai Shimbun reported demonstrations by members of the American Auto-Union rallying at the Japanese embassy with signs saying “Toyota is destroying America’s labor structure,” and the like. It commented, “in light of the American mid-term elections, it is undeniable that Toyota’s car quality problems will eventually turn into a political issue.” The Japanese Asahi Shimbun explained U.S. Transportation Secretary Raymond Lahood’s harsh attitude toward Toyota as rooted in pressure from a subpoena from the U.S. House Committee on Oversight and Government Reform, to be questioned on February 10, as well as a hearing from another House committee. The transportation secretary would naturally divert this pressure by pressing harder on Toyota.
In addition to sticking accelerator pedals, the Toyota Prius hybrid has been reported to have brake failings as well. The company failed to acknowledge the latter defect in a timely manner. According to multiple Japanese media sources, however, Toyota will soon announce a recall of the 2010 Prius hybrid, which was reported to have acceleration problems, and has already notified retailers of its decision. A formal announcement will be released after Toyota reported its recall plans to the Japanese Ministry of Land, Infrastructure, Transport and Tourism. A total of around 270,000 Prius models are estimated to be recalled in the U.S. and Japanese markets.
Toyota Stocks Dumped on Massive Scale
In an email to its North American retailers, the Toyota executive team spoke of impending repair plans regarding the braking system of the Prius model. An investigation on the possible braking defects of its luxury brand, the Lexus sedan, are also under way.
According to Reuters, the American National Highway Traffic agency has officially begun its investigation of the Prius model’s braking problems. The agency declined to comment on Toyota’s recalls, but requested details from the company before these incidents. It claims to have received 124 complaints about braking failures on bumpy ground from third-generation Prius owners; drivers have filed reports of four collisions caused by the failures as well. The agency confirmed that the investigation includes the 2010 edition. Toyota’s spokesperson conveyed Toyota’s intent to provide “full cooperation” in the investigation.
In addition, according to Toyota’s public agenda, its North America chairman is set to appear at an American congressional hearing on February 10; the hearing will most likely cover recall policies and attempt to determine whether or not Toyota attempted to cover up its product failures. Evidently, the outcome of the hearing will affect the company’s reputation enormously. The U.S. House Energy and Commerce committee will hold a similar hearing on the 25th.
With the recent pummeling of Toyota’s reputation, major automakers have been itching to end Toyota’s reign as the world's largest auto maker. Now comes their prime opportunity; following recalls, and sales and production suspensions, Toyota’s stockholders are dumping their corporate shares down the drain. $25 billion just vanished from the company’s market value in recent weeks; unsurprisingly its competitors, Honda and Nissan, experienced respective rises of 3.3 percent and 2.8 percent, as of January 28. In America, Toyota’s sales dropped 16 percent, while G.M. and Ford enjoyed growths in sales of 24 percent and 16 percent.
Auto Market is Toyota’s No More
Car-makers are racing to court Toyota’s customers. Ford and G.M. retailers are “expressing sympathy” for their Toyota counterparts, but they’re also offering $1000 coupons for Toyota drivers if they want to change gear. The German auto-giant Volkswagen, which stands just beneath Toyota and General Motors in global sales, said 2018 would be “the year we will top Toyota in the global sales market.” According to “Plan 2018,” Volkswagen hopes to sell 10 million cars worldwide, a 60 percent jump from what they’re selling now. Note that the German brand has been on the fast track lately, and does pose a legitimate threat to Toyota’s global dominance. Currently, in America, Volkswagen holds a 2 percent share of the auto market, while Toyota has 17 percent.
Companies like Volkswagen, who once wouldn’t have even thought of challenging Toyota’s firm grip on the global market, are now really a group of hyenas waiting to feast on the fallen buffalo. With such intense competition breathing down its neck, Toyota will likely lose 1 percent of its share of the American market this year.
The Korean company Hyundai, which has been doing quite well in North American markets, has also offered $1000 discounts to customers who own Toyota cars. Even Chrysler, which claimed it would not introduce any discounts on its cars for Toyota owners, will give those drivers who buy their Dodge, Jeep and Ram models $1000 cash returns starting January 29.
The Toyota recalls and subsequent “Prius” issues have been front-page stories in the American press for some time now. The U.S. media, along with the government and the House, have been echoing each other in their statements about loopholes in Toyota’s quality management system and negligent attitude toward consumer safety.
U.S. Transportation Secretary Raymond LaHood issued a statement on February 2 saying that there would be an overhaul of the security defects in Toyota cars, as well as the auto-maker’s recall procedures. The United States is even considering levying a colossal “civil reparation fine” on Toyota.
Sources also imply that Mr. LaHood has called Toyota Chief Akio Toyoda recently, informing him of “how deeply concerned the American government is on the safety issues of Toyota’s cars.” The transportation secretary said, on a public occasion on February 3, that owners of the Toyota models to be recalled should immediately stop driving their cars. Though he quickly corrected that as a mistake and took back his words, his opinion made more than just a small ripple in the auto-industry, as well as among consumers.
It’s Got Something to Do With the Mid-terms
A lot of Japanese media believe that Toyota’s predicament is a revival of the trade friction between Japan and the United States in the 1980s, pointing out that America remains noticeably hostile to Japanese businesses. The Toyo Keizai Weekly commented in an article that Toyota needs to improve its crisis reaction and management system, which has been severely undermined by a single-minded pursuit of lowering costs. There, of course, is a political scenario behind America’s “hammering down” on Toyota. The Toyo article quoted “a member of the American auto-industry” saying, “with Papa ship General Motors staggering in bankruptcy, the U.S. domestic industry is falling into anarchy. President Obama could undertake protection measures in favor of American companies to secure the mid-term elections in November. If Toyota can’t handle this right, even more sensational actions might target it.”
Nippon Keizai Shimbun reported demonstrations by members of the American Auto-Union rallying at the Japanese embassy with signs saying “Toyota is destroying America’s labor structure,” and the like. It commented, “in light of the American mid-term elections, it is undeniable that Toyota’s car quality problems will eventually turn into a political issue.” The Japanese Asahi Shimbun explained U.S. Transportation Secretary Raymond Lahood’s harsh attitude toward Toyota as rooted in pressure from a subpoena from the U.S. House Committee on Oversight and Government Reform, to be questioned on February 10, as well as a hearing from another House committee. The transportation secretary would naturally divert this pressure by pressing harder on Toyota.