Toyota Presses On, Reconnecting With Customers
STEVE INSKEEP, host:
Executives at Toyota got some relief. The initial findings of an American investigation into reports of unintended acceleration found no evidence that electronic problems were to blame for fatal accidents. These reports are the ones that led to the recall of millions of Toyota vehicles.
As the cloud lifts, NPR's Anthony Brooks reports on Toyota's efforts to regroup.
ANTHONY BROOKS: When news broke about the government investigation, few people were as pleased as Robert Boch. Boch owns Expressway Toyota in Boston, a dealership that NPR has been following over the past few months. It's been a tough year for Boch. Because of the recalls and Toyota's decision to temporarily stop selling its cars, Boch's sales dropped by as much as 20 percent. And he says in the early days of the crisis, Toyota wasn't much help.
Mr. ROBERT BOCH (Owner, Expressway Toyota, Boston): The communication from Toyota to its dealerships was virtually nonexistent in the sense that we were learning things as we read about them in the press.
Professor MICHAEL CUSUMANO (Management and Engineering, MIT): Initially, Toyota has handled this incident about as badly as you can handle an incident.
BROOKS: That's Michael Cusumano, a professor of management and engineering at MIT. He's also author of a soon-to-be-published book about some of the world's most successful companies, including Toyota. Cusumano says, for years, Toyota knew about problems with its cars, but the information never made it to senior managers. So the automaker was caught by surprise.
Prof. CUSUMANO: It has really not had any serious quality issues until this time. So when this became a public issue, senior executives in the company, including the CEO, Akio Toyoda, seemed like a deer caught in the headlights of an oncoming bus.
BROOKS: Ira Kalb agrees. Kalb is a professor of Marketing at the University of Southern California.
Professor IRA KALB (Marketing, University of Southern California): The one big mistake they made is they created a lot of uncertainty. They gave the impression that they didn't know what the problem was.
BROOKS: Kalb says, in a crisis, companies need to admit quickly that there's a problem, apologize right away and promise a solution. He says Toyota failed to do this. And he says many companies fall short, including BP in the early days of the Gulf oil spill, and most recently, Apple, with its flawed antenna on the new iPhone.
Prof. KALB: And it amazes me because these companies could afford the best advice. And I don't know who they're getting advice from, but they're obviously either not getting it or not following it.
BROOKS: Eventually, Toyota did apologize, and recalled millions of cars and trucks to fix sticky accelerator pedals and floor mats that could trap the pedal. They offered discounts, zero percent financing and free maintenance on their new cars.
Again, Michael Cusumano of MIT.
Prof. CUSUMANO: From seeming to ignore the problem, they're bending over backwards trying to help customers recall any vehicle any hint of a problem.
BROOKS: Cusumano now gives Toyota high marks, and says it's successfully rebuilding its relationship with its customers.
Back at Expressway Toyota in Boston, Robert Boch agrees.
Mr. BOCH: Nobody's done a stop sale in the automobile business. When Ford had a problem with their tires on the Ford Explorer, they didn't do a stop sale. So I think, in a way, Toyota has raised the bar for manufacturers to respond to issues that customers are hearing.
BROOKS: Of course, this story's not over. While it appears to have regained its PR stride, Toyota still faces lawsuits because of those fatal crashes. And government investigations of Toyota vehicles are continuing.
Anthony Brooks, NPR News.