Toyota: in a 'spiral of decline'?

Feb 05, 2010

Share with
friends:

Comments (0) Print this article

Japan's Toyota, the world's biggest car manufacturer, has apologised for having to recall a total of almost 4.5 million vehicles in North America and Europe. The cars' accelerator pedals jam so they speed up uncontrollably.

Last week the company called a temporary halt to production and sales of many popular models that jointly accounted for almost 60% of the group's US sales last year. As a result, the group's American sales slid by 16% in January as rivals' rose.

What the commentators said

Toyota has handled this episode with "breathtaking incompetence", said David Wighton in The Times. It took days for the group to send an executive to respond to press questions, and company president Akio Toyoda only apologised at Davos when pressed by reporters.

Clearly, Toyota's PR operation "is not functioning" properly, said Koji Endo of Advanced Research JapanYet until recently, "they had a culture of responding swiftly to problems".

This episode has taken a "blowtorch" to the group's overall reputation, said Bloggingstocks.com. When it came to reliability, Toyota was once "king". The problem is fast growth over the past few years, said The Economist.

The "dash" to become the world's top car-maker has taken its toll: last year there was a large recall and 2006 saw another bout. Moreover, its rivals are getting their act together and designing increasingly "desirable" cars. Even Toyota's lead in electric vehicles is now in doubt. Toyota appears to be stuck in "a spiral of decline".

7203: ¥3,400; 12m change 18%

Comments (0)

Share with
friends:

Related articles

Leave a comment

This will be the name displayed with your comment.

This helps us verify comments are genuine. It will not be displayed anywhere on the site and is stored confidentially.

Please keep your comment within 1,000 characters and relevant to the main topic. We encourage healthy debate, but we don't allow insults or bad language. Anything off topic or unpleasant, we'll remove. Enjoy the conversation! Thank you.

captcha To prevent spam-related comments please enter the characters shown in the 'Captcha' box to the left.

By leaving a comment you accept our terms and conditions.


FREE - MoneyWeek's daily investment emailJohn Stepek

Our free daily email, Money Morning, is an informative and enjoyable analysis of what's going on in the markets. Written by our Editor, John Stepek, and guest contributors.
Sign up FREE to Money Morning here.

>