Paul EisensteinBattered yet again by a series of embarrassing recalls, accusations of a cover-up and its collapse in a widely-watched quality survey, Toyota is taking an unusual step it hopes will bring things back under control.

The Japanese automaker has long prided itself on having arguably the quickest product development system in the industry, something that it claims can result in vehicles that are more in tune with fast-shifting consumer tastes. But the downside is that this approach – which can bring a car to market in barely a year – may also be resulting in cut corners when it comes to quality.

Some warn the focus on speed has created a sort of see-no/hear-no/speak-no-evil climate in which program managers are under pressure to deliver on time, no matter what, and subordinates fear the wrath of God if they report a problem that could cause a delay.

Now, says Toyota, it is stretching out its development cycle by an extra four weeks to make more quality checks. Whether it will encourage employees to take risks by reporting problems is another matter. If they can't feel safe revealing, say, a faulty engine valve spring, what use is the new policy?



Paul A. Eisenstein is Publisher of TheDetroitBureau.com, and a 30-year veteran of the automotive beat. His editorials bring his unique perspective and deep understanding of the auto world to Autoblog readers on a regular basis.


Speaking of engine valves, the recent Lexus recall couldn't have happened at a worse time.

During a recent radio interview I was asked if I thought Toyota had done a "news dump" – following two big recalls for unintended acceleration, its embarrassing hearings on Capitol Hill, and the decision to pay a record $16.4 million fine for delaying the notification of safety regulators about sticky accelerators, had it decided to push through recalls and repairs on as many models as possible to get the bad news behind it?

It certainly seemed that way. After months of seemingly endless coverage, even we scribes were starting to get tired of the daily Toyota headlines, and were glad to move onto other topics.

As for Toyota, it was willing to invest in a massive new incentive program to help perk sales back up after the disastrous month of February. Unfortunately, the next step in Toyota's turnaround plan couldn't have been more poorly timed. The company has rolled out the sort of folksy, friendly ad campaign – this one specifically focusing on its safety and quality – that's designed to make you feel a twinge in your heart, a tear in your eye and a pang to pull your wallet out and go plunk down a deposit on a new Camry.

Unfortunately, the Toyota marketing team didn't count on the government's announcement that the high-profile – but low volume – Lexus HS250h hybrid had a nasty habit of leaking dangerous amounts of fuel in rear-end collision testing. The maker has put a stop-sale on the ungainly and generally unloved hybrid and will eventually make repairs to about 17,000 of them.

Then, just before the Independence Day break came word that Toyota would have to recall another 138,000 Lexus passenger cars in the U.S. – and a total of 270,000 vehicles worldwide – due to defective engine valves that could cause the vehicles to unexpectedly stall.

It got worse. It seems Toyota knew it had problems with the engines more than two years ago and even made a fix to Lexus engines produced after mid-2008. It just didn't bother to tell the folks who bought GS, LS and IS models before that.

Company officials tell me they didn't realize the extent of the problem, which is why they waited so long to order a recall. But the same folks used to brag about how responsive Lexus was to word of even the most minor problems. In early days, the company would have bought back cars it even suspected of having a safety or quality glitch of this magnitude.

Cover-up? Well, it's hard to say. But it suggests that despite all the promises about getting things fixed and becoming more responsive, well, maybe not yet.

The potential coup de grace, though, was delivered last month by the folks at J.D. Power and Associates, a market research firm that long came under criticism by those who felt it was decidedly unfriendly to domestic brands. Not any longer. Not only did Ford's Blue Oval brand land a spot in the Top Five on the closely-watched Initial Quality Survey, but Toyota plunged from sixth, in 2009, to 21st.

Sure, some of that was due to all the headlines about recalls when Power was collecting its data, but senior Power researcher Dave Sargent later suggested to me that what we're starting to see is a shift in the way owners view the once untouchable Toyota. Psychologists call it the dissonance factor. If you buy something because you believe it's the best, it's then difficult to admit you were wrong. Sure, Toyota did have great quality, but perhaps its survey results also reflected the fact that owners didn't always report the sort of quibbling issues that buyers of less vaunted brands were far more willing to tick off on the Power survey form.

If that's true, it could make it a lot more difficult for Toyota to recover from this fall from grace – even with the shift in its product development policy and the addition of new field offices intended to make it easier to track potential quality and safety issues before they get out of hand.

Toyota will certainly try to regain its once-lofty position, but as the latest recalls prove, it's going to be hard to put the shine back on its halo.




Paul A. Eisenstein is Publisher of TheDetroitBureau.com, and a 30-year veteran of the automotive beat. His editorials bring his unique perspective and deep understanding of the auto world to Autoblog readers on a regular basis.