Slow Down, Toyota

November 5, 2009 at 11:09 am 5 comments

toyota-logoAt the beginning of the week, Toyota instituted a mass recall of floor mats entailing nearly 4 million vehicles. The recall is a response to reports of unintended acceleration and stuck accelerators, with the most notable case being an August crash that claimed the lives of a California Highway Patrol officer and three family members. Punctuating that accident: a frantic 911 call from a passenger in the careening vehicle and a subsequent public apology by Toyota CEO Akio Toyoda.

With the mailing of recall letters, Bob Carter, Toyota’s U.S. group vice president for sales, announced that out-of-position floor mats were the sole cause of unintended acceleration, with the company finding no evidence of any other vehicle flaws. This statement has drawn sharp public criticism from The National Highway Traffic Safety Administration, which called Toyota’s statements “inaccurate and misleading.” Citing an “underlying defect” with the accelerator pedal and driver footwell, the agency stated:

Safety is the No. 1 priority for NHTSA and this is why officials are working with Toyota to find the right way to fix this very dangerous problem. This matter is not closed until Toyota has effectively addressed the defect by providing a suitable vehicle-based solution.

Toyota’s “all-clear” was a colossal PR blunder that blindsided the government agency who has final say on the safety of its cars. Now in damage control mode, Toyota VP Yukitoshi Funo has been compelled to state, “It is not part of Toyota’s culture and the Toyota way to cover up anything.”

Toyota’s travails join other noted PR crises in the auto industry:

Audi, unintended acceleration–Audi sales took a decade-plus hit after mid-1980s reports of unintended acceleration. “60 Minutes” ran a segment that turned into a scandal for the show when it was revealed that “proof” of a phantom accelerator pedal on an Audi was rigged.

Ford/Firestone, Explorer rollovers–In 2000, the NHTSA investigated the high incidence of rollovers for Ford’s trendsetting Explorer SUV. Tread separation on the stock Firestone tires was singled out as a cause. Soon, Ford and Firestone were in a fingerpointing war over shoddy tires and tippy SUVs with both corporate giants accused of insufficient empathy for accident victims. (Ex) Ford CEO Jacques Nasser’s poor performance at a congressional hearing was a compounding PR failure.

Ford, Pinto gas tank ruptures–the granddaddy of auto industry crises, the 1970s subcompact was deemed vulnerable to fires and explosions from gas tanks rupturing in rear-end collisions. Mother Jones produced a “smoking gun” memo claiming Ford knew of the problem and had decided settling lawsuits would be cheaper than a redesign. Later investigation would cast doubt on the conspiracy theory and the Pinto’s actual deficiencies. Still perception is everything, including the lingering perception of Ford as a money-grubbing builder of dangerous cars.

The lesson from all these examples: Toyota must engage in complete and patient cooperation with regulators and safety agencies to prove its goodwill and facilitate independent verification of its cars’ roadworthiness. It must be willing to take extra losses manifested in recalls and redesigns to maintain trust. It must look beyond the floor mats.

The gold standard for corporate crisis response comes from Johnson & Johnson with the Tylenol poisonings of the 1980s. As product tampering became apparent, J&J pulled Tylenol off the shelves, designed tamper-proof packaging, and eventually discontinued capsules in favor of one-piece caplets. They took full responsibility for public safety and kept lines of communication open. All of J&J’s choices were costly, yet invaluable. The Tylenol brand survived and flourished, J&J’s reputation grew, and the case study became standard reading for PR students and practitioners.

Toyota will not decide if its cars are safe. Investigators, regulators and ultimately the public will.

POSTSCRIPT 1: The Los Angeles Times reveals the NHTSA dismissed numerous reports of unintended acceleration in Toyota vehicles over the past several years. The PR debacle grows as the government agency calling Toyota to task now appears complicit in the failure to confront this problem. Shades of the SEC and Bernie Madoff.

POSTSCRIPT 2: Toyota announces an additional step of modifying and eventually replacing nearly 4 million gas pedals.

POSTSCRIPT 3: The Los Angeles Times reports the possibility of electronic throttle control as the true root of Toyota’s accelerator problem and conveys opinions that the NHTSA “hasn’t kept pace with technological changes.”

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Entry filed under: Crisis Communications, Leadership, Public Relations. Tags: , , , .

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