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I don't believe I said that "ALL" with respect to my comments. Obviously, the phenomenon will vary to some extent over numerous dealerships but in general the trend is obvious.
In general, the imports including Toyota and the more upscale brands put on airs as to the supposed superiority of their products. I believe the escalating recalls of Toyota products put this fantasy to rest.
I am not sure why this is. Someone here suggested it may be because of all the dealer installed options Scion offers.
I can be pretty forgiving if I have an intelligent dealer service center and a good relationship with them. If I like the subcompact I'll spot them a mess-up or two or even three. Really, I sure will. Four flub-ups? Now you're startin' to push things a tad!
2021 Kia Soul LX 6-speed stick
"In general, the imports including Toyota and the more upscale brands put on airs as to the supposed superiority of their products. I believe the escalating recalls of Toyota products put this fantasy to rest."
A spat of recalls ain't going to put anything to rest. If anything, it is giving false sense of security to those pro-domestic fans like yourself who are revelling in a situation that in typical Toyota fashion will be corrected, I assure you.
Dream on if you think Toyota is going to continue to allow a 3 decade old reputation slip away. Dream on my friend. :shades:
I am not surprised with owners of older Toyotas who are happy, because I also believe that the old Toyota is consistent with their quality philosophy. Just that you know, like humans, corporations could become overzealous, ambitious, greedy and somehow forgot what got them there in the first place.
Even though I also believe Toyota is not going to suffer from a deep catastrophic fall, they have too much cash, and many experienced people, but I think the current CEO's obsession with cost cutting could give Toyota's competitors more time to catch up. I also fear that many Toyota cars sold in the past recent few years, installed with components from those squezzed suppliers, could in the near future, report more problems, not just in USA, but worldwide.
I read from a good book " Quality of earnings " for stock analysts that if you want to detect a company in trouble, even though they report earnings growth, you must also look at the sales growth vs receivables and inventory growth. For example, if the company reports 15% sales growth, 25% profit growth, but the receivables is growing at 60%, inventory growth is also pilling up at 50%, especially if this discrepancy has been going on for the past 3 years, watch out !
Toyota obviously does not have a cash flow financial problem, but using this analogy, I am pretty sure Watanabe could be reaping the results of his past obsessions. I got some figures :
In 2003, 200k Toyota cars recalled in USA. In 2004, increase 5 fold, to over 1 million. In 2005, 2.2 million. Now, what is the annualized growth of Toyota cars sold in USA for the past 3-4 years ? 10%, 15%, 50% or more each year ?
I am not saying Toyota is doomed, BUT if I am a stock analyst / investor and I notice the HUGE discrepancy in annualized sales growth vs recall growth for the past 3-4 years, I will sell / avoid Toyota stock TILL things have settled down and the picture is clear that the company has corrected things.
I remember an interesting story from a stock book. Its said that in the old days, there is a smart investor who is suspicious abt the continued growth of sales and profits reported by his stock. What did he do ? He sneaked near the factory and observed the factory smoke stacks. And AHA ! He noticed that daylong there is very little smoke from the stacks. He sold his stock. And true enough later the company finally downgraded their earnings report.
This story may be a joke, but I get the point.
And before this pattern has been reversed, I personally will avoid buying Toyota cars for the near future. Because I don't want to get one equipped with components from unhappy suppliers whose margins are squeezed real bad. God knows which suppliers can manage to retain the quality, which ones will slip.
For example, one just don't expect a manufacturer of premium quality emulsion paint to bring down their price ever closer to those cheap / middle rate paints REGARDLESS of how smart / cost efficient the paint factory is. I always believe that you get what you pay for. There is a limit to how efficient one can be.
I am not saying Toyota cars have all become bad, BUT if you study history of the rise, fall, and slip of corporations, you will realize sometimes one big smart (or so he thought) CEO could ruin an otherwise good corporate machine, temporarily or for good.
Toyota, wake up, and pls be fair to your suppliers, otherwise I am taking my money to other brands whose quality, I am convinced, is not far from you. And may even be better today knowing how you treat yr suppliers. I take those JD Power surveys with a grain of salt, perhaps those owners have not faced troubles - YET.
http://www.cio.com.au/index.php?taxid=19&id=852631413
Maybe History DOES repeat itself. Could Toyota forgot what got them here today and unwittingly repeat what GM had done in the past.
Pls read the whole article, but here is the section from the above article from the auto world :
".....There's an important lesson here. In the recessionary 1980s, General Motors created a procurement czar who used his company's massive buying power to beat up suppliers on price. The world's largest automobile company earned enmity, horrible relationships and a reputation for building cars that underperformed.
By contrast, a desperate Chrysler couldn't bully its suppliers, so it partnered with them. The feisty company pioneered the concept of "gain-sharing" with its suppliers; that is, Chrysler would let suppliers keep a significant portion of the margins when suppliers came up with innovative ways of cutting costs and adding value. Strong supplier relationships were at the core of Chrysler's corporate comeback..... "
I can't help but speculate that could the old Toyota be like the Chrysler of old, and the NEW Toyota be like the GM above ?
If one wants to reassure me that Toyota is getting lower prices and still upholding the same quality, I am NOT buying it, not at this moment when the recall / sales growth ratio discrepancy is highly disturbing...
I've read numerous articles about suppliers in the US and their attitudes toward the major car manufacturers. And in terms of satisfaction with the automakers, the suppliers consistently rate them in the following order, from best to worst:
Toyota
Honda
Nissan
DCX
Ford
GM
As I tried to point out in my earlier post, large dealership chains that own both import and domestic stores are rapidly becoming a fact of life in the more densely populated areas of the US. These stores do NOT operate differently depending on whether a domestic or import nameplate is on the building.
In the Washington DC area (the largest metro area closest to me), the following dealerships own multiple stores and are responsible for the bulk of sales in the area: Pohanka, DARCARS, Ourisman, Koons, Rosenthal, Sheehy, and Fitzgerald (Fitz Mall).
In my little burg in central VA, the dominant chains are Brown, Colonial, Price, and Battlefield. I can assure you that you will be treated as badly at Brown Dodge as you will at Brown Toyota!
I used to be fat when I was young, thin during high school, now I am back to overweight again. Tried the Atkins diet, worked, but oh, I often cannot resist the urge to eat carbohydrates !
Things often change in the world, I sure hope you are right, BUT again those huge recalls appear to point to a different direction....
Some may say, well, those recalls, many are not serious, life threatening, yup, I agree, BUT so far as I can remember, in the past, I seldom, if not, never read about Toyota recalls far OUTPACING the sales growth rates. Way back in the 1990s. Or early 2000s. And that's before we ever hear about the name Watanabe.
I never hear the old former CEO Fujio Cho being a cost cutting maniac. Fujio Cho is even said to be a polite, soft spoken boss. The Chairman, Hiroshi Okuda, is more brash. But the new one, Watanabe, I am not quite sure. Fujio Cho is now the Chairman if I am not mistaken, but you know, often the Chairman is a much older man, more often playing a ceremonial role. Power now lie in the hands of Watanabe.
Maybe Fujio Cho himself is impressed with Watanabe's former huge cost savings so that he dared not interfere. BUT looking at the huge growth in Toyota recalls, I think even Fujio Cho himself may start to worry and who knows tell Watanabe " Watanabe san, maybe you should be more careful abt those cost cutting exercises vs our suppliers. "
I also read elsewhere that Watanabe has never gotten an overseas posting during his whole career at Toyota. That is Watanabe is a full time executive at Toyota Japan for his whole career. That's a bit surprising for me, because I would expect the new CEO to be a man who had experience and lived in many regions around the world to run such a big company as Toyota.
But Hiroshi Okuda and Fujio Cho may have been SO impressed with Watanabe's big cost savings to chose him over other executives. The next few years will tell whether they had chosen a genius, or madman. You know, Fujio Cho, experienced and smart though he is, is still human after all. He may have chosen the wrong successor.
Just maybe... the limited scope of you and your acquaintances flies in the face of the experiences of the rest of the market. How does it seems logical that the largest part of the US market seems to be moving enmasse from the detroiters while paying higher prices and getting worse treatment?
Do you think that maybe you did something, that millions and millions of others did not do, that caused your horrid experience. Is it possible that you went in with a preconceived notion that you were entering the camp of the enemy.
There is likely to be a larger number of recalls from a larger sales volume. There is no doubt about that. All vehicles are just elctro/mechanical devices assembled from a multitude of suppliers - any of which can have a bad design or error in manufacturing including Toyota ( snap ring issue ).
To me though the public's perception of recalls though seem to be akin to be its perception of divorce. In the 50's divorce was a familial scandal for the most part. By the 70's it was commonplace. By this century it affects more than 50% of all marriages.
Most recalls are extremely minor adjustments to ensure that a future accident doesn't occur; a replaced tie rod, reinforced steering component, etc, etc. Since the Ford/Firestone fiasco and the actions by Congress all manufacturers must by law generate a recall if they think that there may be the possibility of a potential safety problem. Noone wants to face the legal consequences of what Ford and Firestone went though nor face the wrath of Congress. So just issue the recall make the adjustment.
It may come shortly in the near future when all vehicles are linked to the internet that the recall notice will light up a signal on the dash in the same way the 'check engine' light comes on. When a recall is issued for a range of VIN's those affected will just have a signal sent to those vehicles and the indicator light will come on. Every vehicle built will be expected to have some recall done in the course of its life.
Recall number make great press stories but this is a different environment both technologically and politically. All vehicles are better than they were 20 yrs ago but they are immensely more complicated and politically noone wants a Ford/Firestorm situation to occur again.
Recalls by all manufacturers are bound to increase.
Here is an alternate view: If a major manufacturer isn't recalling a certain percentage of its vehicles it's not doing enough to ensure the safety of the drivers.
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IMO the media thinks the "Toyota has quality problems" story has legs. They aren't going drop it overnight.
Once a storyline is set in the media it affects news coverage of a company for years. Ask WalMart, Microsoft, IBM, GM, etc.
To Toyota's credit, they are taking their quality problems seriously. Quality has been their lodestone for years: they can't let it slip.
Do you think that you are going to stop going to WalMart? I don't think we are all gonna stop going to WalMart. We want the good prices. It's true not all the WalMart prices are the best. But some WalMart prices are unbeatable. Some of the electronic prices are unbeatable anywhere, for instance.
Here's an example. My son got into the habit of taking our boombox outside to boom his rap music in the warm summer nights and watch the great southern Arizona starshow at night(I can't believe how well you can see the stars and the Milky Way at night here in the high desert. We are at around 4,300 feet up and that helps in the clarity aspect of the view). Well, he also got into the habit of leaving it outside at night. Condensation set in and BOOM! No more patent electronics working well in my boombox.
Anyhoo, I bought that boombox at a WalMart in central Missouri a few years ago. It was a really nice boombox for the $30 I paid for it.
Guess where I'm going back to today to buy a new boombox? You guessed it-WalMart. How much will I pay? That's the $64,000 question for me.
What does this have to do with Toyota? Humm...let me think. Does anyone really think that Toyota is going to let their perceived reputation slip into the potter because the dorky American press has picked up another story and started hitting the bricks with it? Don't think so, dudes and dudettes.
I'm particularly smitten with the Scion aspect of Toyota and the main offender in recalls that I can recall is their Scion tC and it's potentially exploding deflector-glass panel located just in front of the moonroof. Apparently some tC owners were experiencing that piece of glass exploding on them at freeway speeds. Could hurt, eh? There was a recall about that problem. Toyota has instituted a permanent fix for that problem for current owners of 2005 and 2006 Scion tC's and for those buying the 2007 tC and 2007 tC Spec Scion has put a fix into place in their production line that takes care of this problem.
If anyone knows of any information regarding Scion recalls please post away. If the hosts would rather have those posts go in a Scion-related thread here on Edmunds that would be fine as those Scion threads are read by this padre living close to the US-Mexico border pert-near every day. OK every day!
I'll have to head over to Tombstone, AZ, to witness the re-enactment of the shootout at the OK Corral. Apparently that gunfight is re-enacted every day of the year there. :shades:
No, do include talk of Toyota-Scion recalls because I am keenly interested. I still don't see a need to chew my fingernails down to Michael Jordan levels whenever he had to play against Gary Payton on defense. I really don't. I'd like my next new car to be a 2006 Scion xA in Polar White, Classic Silver or Salsa Red. 5-speed form with the only accessory required being an armrest. I would then take the little darling over to Pep Boys and get some Proline rims installed (about $300 including taxation) by the Pep Boys in a peppy, forthright manner. Over.
Out.
2021 Kia Soul LX 6-speed stick
But the WalMart case is a bad analogy because there are no accusations that Toyota has mistreated or badly treated people, but merely that quality has dropped.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
Don't get me wrong. I also agree that Toyota's fundamental ability to make good cars is still intact. Just that perhaps the new overzealous CEO may have roughen things up a bit. More likely than not, this matter should be just a temporary disturbance. Toyota should be experienced enough to correct them and goes back to normal. But I prefer a guy like Fujio Cho running the show though.
I have always liked what they call unassuming, soft-spoken (but still driven) CEOs. People like that are great motivators, build good relationships with every stakeholder, and still manage to get growth by motivating everybody. Hardball tactics never appeal to me. I just can't help but feel Fujio Cho is the former, Watanabe is the latter type.
However, in my opinion, today's cars, especially famous brands like Honda, Toyota, Nissan, the Koreans, even the domestics, I feel that their quality gap is pretty close. Thus today, when it comes to buying cars, I personally do not have any brand loyalty to any particular brand. Like I said, I feel that the no.1 and the no.5 ranking on the JD Power surveys do not reflect big gaps in quality.
I simply decide based on styling, engine, mpg, color, price / what I get, etc. Brand alone will not open my wallet. Which car comes closest to my needs will win my heart.
Unlike in the old days when anything Japanese is laughed at, or the recent past when many domestics are in turn laughed at (the wheel of fortune turning again), today most big automakers pretty know how to make decent cars. That's why even the Koreans are getting good marks.
Things could get better before it gets even better, OR things will get WORSE before getting better. I have no idea, and I am not taking any chances.
Anyway it's also because Toyota is not the only car maker around. There are still so many interesting non-Toyota cars around to pick from. Why take the risk ?
Toyota, you can still open my wallet, but before the fog dies down and the picture becomes clearer, I see no point in sticking to a brand. Especially when the brand is having issues not normally associated with that brand.
I remember what Warren Buffett said : The thing for getting good investment results is to AVOID risks. Ha ! Normally the saying is " High risk, high return. " I'll stick to Warren Buffett's advice anyday.
Christian Wardlaw’s Opinion of the 2007 Toyota Camry’s Quality:
For years, our editors have been noticing a general degradation of build and materials quality in Japanese cars, but we’ve always written such observations off as oddities given the exceptional attention to detail these brands have historically exhibited. With our test sample, a 2007 Toyota Camry XLE V6 with less than 3,000 miles on the odometer, it’s time for us to stop making excuses. This test sample, more than any in recent memory, served to underscore that the domestics have made great strides in build quality, while vaunted brands like Toyota are beginning to struggle.
The assembly and materials quality of our test car was worse than some recent General Motors products we’ve evaluated, certainly not up to the standards one expects with a $31,000 price tag and definitely not up to snuff compared to a Hyundai Azera that was in our parking lot the same week as the Camry. There is no excuse for the numerous problems with panel fits found inside and outside of our test car. Our Camry constantly creaked and squeaked and rattled inside. The plastic used for the back of the steering wheel spokes and the sides of the center console emitted that same hollow, cheap rasp when fingernails scraped across it as that for which we’ve excoriated Chrysler, Ford, and General Motors countless times in the past. The leather was stiff and cheap feeling, the paint displayed an orange peel finish at a glance, the dash pad fit poorly around the driver’s side air vent, and with just a twist of my wrist the passenger A-pillar trim popped off in my hand. I’ve got a litany of little problems that I uncovered with the Camry, from the flushness of fit of the front speaker grilles to the inconsistent finish of the headliner at the plastic C-pillar trim panels, but space is short.
We’ve come to expect this kind of indifferent assembly from the former Big Three automakers – in particular General Motors. But after taking a close look at the way our 2007 Toyota Camry was assembled and the materials used in its construction, and comparing these observations to the sticker price and what we uncovered in as thorough a probe of that $27,000 Hyundai Azera we test drove the same week, I have no other choice but to conclude that Toyota has lost its Camry mojo."
http://www.car.com/content/shared/articles/templates/index.cfm/article_id_int/14- - - 81
It may not be quite as luxe, but they seem pretty durable and practical.
And having the cash left over after your bad experience would be quite a plus.
The American buying public is a lot smarter than you give it credit for being. People just don't throw $20-$30K around like confetti. Your antagonism towards all imports seems to skew your view of reality, slightly :P .
The cars.com review was one negative viewpoint out of maybe 10-20 very positive reviews. The others nearly universally loved it. It's always good to have balance.
BTW. None of the reviewers are located on Madison Ave.
Both approaches appear to be working. Between the three of them, they have, I believe, more than 80% of the market.
I don't think Watanabe-san has much direct say in how Toyota in the US deals with its suppliers.
You have heard the horror stories regarding current GM global purchasing czar Bo Andersson? Talk about twisting suppliers' arms!
And are you aware that Carlos Ghosn of Nissan has the nickname "Le Cost Cutter"?
Recalls? 2 in total -- one on the '97 for a possible loose steering wheel, and one on the '04 for possible improperly installed (twisted) side curtain airbags. The latter was found NOT to be a problem in my car once the trim panels were removed. I would guess in the '97 that the bolt holding the wheel was simply torqued to spec -- mine wasn't obviously loose or in danger of falling off!
With all the bad press, shouldn't people be running away instead?
Read the whole article everyone, starting here at the beginning!
Our Mr. Priggly has happened to extract the most damning paragraph of a generally positive review. The review is written by 3 reporters, who in turn comment on 3 issues: driving impression, comfort, and quality.
It just so happens that writer Wardlaw has the most negative opinion on quality, and this is only what Mr. P. has chosen to post.
I'm afraid your bias is showing!
Three of three writers recommend against purchase of the 2007 Camry
Toyota has had 10-15 years in the media sun with hardly a critical word. They will find being on the media's bad side is no fun.
I wonder if Toyota is being cast as the next 'Evil Corporate Villian'. Wal Mart is the current incumbent, but that can change - Sears, IBM, K Mart, GM, and Microsoft and others have filled the position in the past.
Only the most obscure reading and interpretation of this lengthy article could result in it being construed as "generally positive."
Yeah, it's so generally positive that NONE of the three writers recommended a buy of the 2007 Toyota Camry!
So who is actually biased, huh?!!
I didn't realize there were two more pages: one on design and one on recommendations.
So spank me!
But one thing that the writers keep coming back to is the fact that their test car was a loaded top of the line V6 that cost $31,000. This appears to be a key factor in their overall negative review.
I'd never get the V6 (all 3 of my former and current Camrys have the 4-cylinder), plus it seems that you'd get a lot more value for 2007 by purchasing the mainline LE model with just a sprinkling of options, such as electronic stability control.
So equipped, the car would sticker at about $22,000. And there would be no fake wood to grouse about!
The spot weld has broke on the drivers door that hold the check strap and the left rear automatic door blew up spraying plastic parts at my wife. This was one of the firts new Siennas made. I bought this van to get "Toyota quality" Quite frankly my 1992 Dodge Caravan was a better vehicle with less problems and I had that for 12 years.
Toyota has not met my expectations.
in the 80's, i had an awful experience with toyota, so i'll never go back there.
Coming from upstate NY, hurricanes are a lot like blizzards, hunker down, wait 'em out and clean up the mess afterward.
However, I also realize that sometimes, people have FALLEN in LOVE with Toyota, one reason could be, some people are so enamoured by Toyota's hybrids that they think Toyota is the perfect automaker, environmentally responsible, save the world's oil etc.
Thus when their darling brand comes under attack, they get defensive. They refuse to believe that Toyota's quality could have dropped. Again its perfectly understandable.
For me, my stance is again neutral. I refuse to fall in love with any brand. Whoever gives me best value, wins my heart and my wallet. And my choice will always change depending on new car models coming out that appeals more to me.
I am not a hybrid hater. Just that currently I refused to be enthralled by Toyota's hybrids (or Honda's or whoever's). Because I am aware that hybrids are extremely complicated machines. Even if Toyota made them, I refuse to think that Toyota can guarantee excellent reliability for XYZ years. Especially after the warranty period runs out.
Anyway, with the small number of hybrids sold compared to conventionals, and the fact that Toyota STILL sells ever larger numbers of conventionals, including some gas guzzlers, ESPECIALLY in other parts of the world like third world countries, hybrids are losing the race, everyday, every hour.
When one realizes the kinds of cars Toyota sell in third world countries, without any safety features, without even the basic catalytic converter, 15 mpg middle size minivans, (these are not big trucks or big SUVs mind you), just to make the price insanely cheap so that they can get bigger market share, one can't help but realize Toyota is just your typical corporate machine out to increase market share and profits.
For those who think I am lying, I can give you info on some Toyota cars sold in less developed countries. Utterly disgraceful. Americans will never believe Toyota made them.
Thus I am convinced Toyota is not like green peace, out to save the world. I study many car models sold around the world, and trust me, Toyota in many other countries, you will not believe the kind of cars they sell there. And many even sold in tens of thousands per month ! Talk about cleaning up the environment !
Maybe Toyota cares about US air quality, but not those in less developed countries. As if there is a border separating clean US air and dirty third world country air !
So how can Toyota's hybrids even hope to clean up the world environment when they are selling polluting, poor mpg cars in large numbers in less developed countries ? That's why I never believe hybrids can clean up the environment. The numbers are too stacked against them. Even their makers are not helping things. I think hybrids have more effect on image, feel good thing, lowering CAFE etc. so as to be able to sell some more gas guzzlers.
Its OK for early owners of hybrids, still under warranty, but I predict that once the warranty period ended, I predict their resale value will plummet. With no more warranty to cover them, hybrid owners are on their own ! When those several thousand dollars battery expire, or other expensive components start to get old, wear out, who foots the bill ?
Thus the only people who enjoy savings (even this is paltry) are the early hybrid buyers. Later used hybrid buyers could find the maintenance / spare parts costs could wipe out any gas savings they got.
Thus I hope people, when they judge automakers like Toyota, one should be rational, not because they are deeply in love with a brand. Just because they make hybrids does not make Toyota infallible, make mistakes etc.
I may sound critical of Toyota, but let me tell you, I don't hate Toyota. Only that Toyota is just another profit minded corporation. But I do get upset with Toyota when they preach about hybrids, cleaning up the environment, BUT they behave totally differently in other countries.
Remember, hundreds of thousands of hybrids won't do any good if TENS of MILLIONS of other polluting Toyota cars from the less developed countries emit stuff which sooner or later will cross into US air, and pollute the whole world.
Talking about Toyota hybrids / their models outside the US may sound out of topic, but my purpose is to highlight the fact that Toyota is NOT the saint that many thought they are. So judge them as a typical corporation, not some saint to embrace regardless of what happens...
The press seems to have grabbed on to this story. They won't let go till Toyota resolves the issues that generated the story.
This is a very informative set of stories.
Glossing over problems isn't much help in solving them.
http://www.businessweek.com/magazine/content/05_08/b3921062.htm
I have no doubt abt Toyota's process. It's a tried and proven system. BUT the problem is, folks, don't forget that Toyota DO NOT make 100% of all their car components themselves. Nowadays any car have many components which is made by external vendors, suppliers as we call them.
Now, no matter how good the process is, IF the quality of the components coming in from those squeezed suppliers has dropped, what good will it do ? Less uniformity, less precise tolerance to needed specifications for example.
I mean, I am not against reducing cost per se. BUT when Toyota decided to benchmark China prices to squeeze their traditional seasoned, albeit more expensive Japanese and American suppliers, I can SMELL trouble coming !
Anyone who knows how China has become the world's toy factory (and other goods) knows how they did it. Their costs are just too low ! Their workers are paid a pitiful sum. Now, toys are simple stuff, so made in China toys probably will work fine.
Now, we are talking about complex, high precision car components. I don't have to be a car engineer to know that Chinese suppliers just DON'T have enough EXPERIENCE and know how in matching old seasoned suppliers. Nothing to do with who is smarter.
So imagine if you are a Japanese or American car part supplier. Toyota tells you " You got to give us prices similar to those made in China, or else ..."
What do you do ? Can you EVER hope to come close to China prices considering your workforce, your machines are more expensive, but more experienced, and more capable of making higher quality parts ?
But you still want Toyota's massive business. To come ever closer to Chinese price levels, you ......
Will you go to your seasoned heart surgeon, and say " Doctor, that doctor 5 blocks away charges half of what you are charging (never mind that the younger doctor is less experienced, probably uses cheaper pay, fresh nurse graduates, and does'nt have the money or know how to find and invest in those more expensive heart surgery medical equipment). Match his fees or I am taking my heart to him ! Will you do that ?
But that is what Toyota is precisely now doing ! Those who think I am making this up, pls read the businessweek article above ONE MORE TIME.
Could a big corporation like Toyota make mistakes like that ? You bet ! Not because they are stupid, but size, money, and power got over their heads ! Do an autopsy of many former big corporations who have shrunk or gone bust, and you will know that corporations are just like any other human. They could screw themselves.
If I remember correctly, K-mart used to be the king while Sam Walton is a small one shop retailer in Arkansas. Guess where is K-mart today ? Talk about the king becoming a pauper and the pauper the king !
Someone said Watanabe have little say in Toyota's relationship with American suppliers. You think so ?
Look. Toyota made most of their money in USA. More than 2 million per year recently in the US. So it's obvious that when we are talking about part supplies for Toyota cars in America, we are talking about mind boggling amounts of money.
Will Watanabe, the zealous cost cutter, demanding China like prices, say to Jim Press " Jim, I am leaving this matter to you entirely ". ?
More likely, Jim Press, probably inside his heart knows that American suppliers too deserve decent prices and profits. But with Watanabe his boss looking over his shoulder and breathing down his neck to make sure he gets what he wants, you think Jim Press have a choice ?
Anyway who knows how many percent of Toyota cars made in America uses US, Japan, or China parts ? How much have this mix changed ?
For me, there is no smoke without fire. If one insist that there is nothing amiss at Toyota, then I could only be convinced if someone can explain the logical consequences of " Match China prices or else " mentality, and that the recalls are zooming up way much faster than sales growth.
Here is the tough irony. For example, in Indonesia and many other South East Asian countries, one best selling car is the Toyota Innova minivan. I heard this model alone sells 8k units per month in Indonesia ! That is big in a market of about 400k a year in Indonesia alone ! That means this model alone accounts for 24% market share ! For better or worse.
The best selling Innova G version has ZERO airbags, ZERO ABS etc. ZERO catalytic converter. Nothing. Just car, engine, seats and wheels.
How much do you think this car cost ? Guess. $15k ? I tell you. This EMPTY car is priced at $21k ! If you don't believe me, I can give you precise data. With the internet, I can know anything I want about any car around the world ! So do you if you want to check things out.
On the other hand, the Chevrolet Zafira, the closest GM competitor to the Toyota Innova, has 2 airbags, ABS, full set of seatbelts, catalytic converter, many other accessories. But as a consequence, Zafira is priced higher at abt $25k. Some Toyota cars also do not have seatbelts in the 3rd row ! That's Watanabe cost cutting at work !
I can't lie about such things. Do your own net search if you want to verify. Toyota Innova, Toyota Avanza is another atrocious car. Very cheap, at only $11k. 1300 cc engine that is supposed to carry 7 people in a small cramped body. Toyota's new child, Daihatsu, makes the same car with a 1000 cc engine !
Will you buy a Toyota mini mini van that have 3 rows for 7 people, cramped though they are, powered by a 1300 cc engine ? Again ZERO safety features. ZERO ABS, ZERO catalytic converter ? That my friend is the TRUE FACE of Toyota in markets without regulations.
And FYI, developing countries nowadays are not as pitiful as one might thought. For example in Indonesia, unleaded gas is plentyful, unlike in the 1970s and 80s. If you go to the Indonesian capital, Jakarta for vacation, you will be surprised to see many luxury cars like the BMWs, Mercedez, Lexuses, even some Ferraris ! These cars all need high octane gas, unleaded, and Indonesia do have them.
But the thing is in a country like Indonesia, there is no strict emissions rules, no safety regulations. As a result, corporations like Toyota are free to take advantage of this and offer cheaper (but atrocious) polluting and poor mpg cars compared to the competition and get market share.
Toyota have been doing this kind of thing in Indonesia and other countries for a long time, as a result, they are the biggest there now. And these models have very very fat profit margins, and made Toyota very rich (Compare the $21k empty Toyota Innova with what you can get in the US)
Consumers there also think Toyota is saint. And that their cars are most affordable, cheap to run, never mind they are polluting the air and burning oil like crazy! Not to mention hazardous to their owners lives !
Other brands are priced more because at first they refused to compromise safety and emissions, but after many years of doing business in these markets, they start to realize that in a country like Indonesia where people are not safety / environmentally conscious, they lose to Toyota's many cheaper offerings. They tried to follow, but too late !
Not just in Indonesia, but Toyota did the same thing in other Asian countries, just that not as bad as in countries like Indonesia. The weaker the regulations, the more " empty, polluting " Toyota's offerings will be. Have a look around Toyota's websites around those " poorer " countries if you think I am lying.
What about Honda ? and the others. From my observation, Honda is number 2 on the list of such behaviour after Toyota. The famed Honda Fit, known as the Jazz in Indonesia, is also a best seller. But unlike in the USA, The Fit in Indonesia is again stripped of all safety features and the catalytic converter. As a result, the price is " only " $16k. If not for the Fit, Honda will be unable to catch Toyota in Indonesia.
Nissan is the latecomer, and the more " Dumb / idealistic " one. Why ? All of Nissan's offerings, (with the exception of 1 decade old model), all come with safety features and catalytic converters. As a result, all are priced higher than Toyotas and Hondas. Result ? Far smaller market share. Much less than the ratio of Nissan is to Toyota and Honda in the US. Same with GM and Ford.
Perhaps Nissan's French DNA today prohibit Nissan from offering too many atrocious cars. French cars, though a joke in the US, is known as equipped with many safety features in many markets around the world.
So its obvious that in countries with poor regulations, the winners like Toyota and Honda can win because they are willing to be " ruthless ". Safety and emissions must be thrown out of the window, because consumers there don't care about such things, and not willing to pay for them. The idealistic ones will have to suffer with less sales and profits !
Don't get me wrong. What Toyota and Honda has done is not a criminal act. It's perfectly logical, in line with what a profit minded corporation will do. The thing is this PROVES Toyota is profit minded, not environmentally conscious like what many think they are. Just this simple. Don't make Toyota out to be a clean saint.
If they indeed want to help save the oil, clean up the air etc, they will not have removed safety features, remove catalytic converters from their best selling models. Result ? Cleaner air around the world, BUT less money for Toyota.
By the way, how much does 2 airbags, ABS, catalytic converters cost ? Not a lot, but Toyota realizes that multiply this small sum by big volumes and presto ! Lots of extra cash ! And who don't want extra cash ?
FYI, in countries like these, there are NO hybrids sold. Why should Toyota and Honda sell hybrids there ? Because there are NO CAFE rules there. And Toyota / Honda knows that hybrids are more difficult / expensive to repair and maintain, which might affect their image in these markets as " cheap and easy to maintain brands ".
Which route has Toyota (and Honda) chosen ? You tell me. Remember, like the letter in a bottle which is floated on the ocean to send ocean mail to other continents like in the movies, dirty air from a country like China, Indonesia WILL reach US airspace sooner or later.
If anyone don't think so, tell that to the 911 hijackers. There are NO barriers in US airspace. Air around the world flows, they don't stay put.
That's why I think deep down inside, Toyota and Honda are THE SAME as GM, Ford etc. Just that they play the PR game more smartly ! And their hybrids sure give them the ticket to sell more conventionals / gas guzzlers ! Not to mention clean image in the minds of many Americans who doesn't know how they behave in other markets. Remove CAFE and I want to see what happens !