Toyota on the mend?

kdhspyder · November 2009

I read that as a 'self-insurance' fund fed over how many 'x' number of years. It's been building and building and building. That shows good financial management. Imagine the interest and profits from that fund. :surprise:

kdhspyder · November 2009

Please...

You're beginning to sound like your fellow California 'dark clouder'. We're not even talking about the same order of magnitude. Even if every one of the 3.8 million vehicle owners did agree to swap out the gas pedals, very very unlikely, at a cost of $100 per swap then that comes to all of $380 Million.

3% interest on $5.6 Billion comes to...$168 Million...annually. SNAP.

nippononly · November 2009

$100 per swap?

The consumer pays $120/hour for labor. I bet the manufacturer pays at least $90.

The pedal won't be free, it comes with manufacturing costs, shipping costs, and associated accounting costs. That's only after it has been designed, for which there will be additional cost.

What if they have to do bodywork on 3.8 million vehicles to modify the floor pan? NHTSA has hinted that the design of the floor pan is one of the problems.

All I'm saying is you have no way at all to estimate the cost of this recall. But we can have a gentlemens' wager if you like: it will cost at least twice as much as the $380 million figure you propose.

As for "grandma"s remark above, it should be placed in the context from which it came: that person's tolerance threshold for cost-cutting has been exceeded by Toyota, and maybe by several other automakers also to judge from the way it was worded.

Toyota has pretty much exceeded my tolerance threshold for cost-cutting too. That has happened in the last 5-7 years. 25 years of buying Toyotas may have ended permanently for me unless Toyota does a drastic double-take in the next few years. That opinion has not been influenced at all by this latest floor mat thing, which I still say is at the limit of what the manufacturer should be responsible for (given that operator negligence and error seems to have occurred in every case).

explorerx4 · November 2009

what i do know is that even a model refresh can cost billions before the production unit goes out the door.

kdhspyder · November 2009

From the latter to the former...

Cost cutting is a way of life in business and manufacturing. It's a matter of fact and it's a matter of survival in the auto industry because we the buyers simply will not pay the price for a vehicle that was linked to the rate of inflation.

A 2000 Camry in Oct 99listed for ~$20000.. At the nominal rate of inflation from Sept 99 to Sept 09 prices have increased 28.63%. At that rate the current 2010 Camry should be priced at $25700!

This $25700 vehicle would be equipped with a
2.2L engine with 125 HP
It would get ~30 mpg on the highway real world
It would have two airbags
It would have an AM/FM CD tape player audio system
It would be the size of the current Corolla!!
It would have only the basic ABS system, sometimes.
Except for leather and a sunroof there were almost no other options
THAT's it***********

A 2010 Camry now lists for ~$22900. It has more equipment, more power, more safety features.
2.5L engine with 169 HP
It gets 36-38 mpg in realworld highway driving
It has 7 airbags and active headrest restraints
It has AM/FM, CD and AUX inputs
It is significantly larger and safer than the prior model
It has the Star Safety system that advances the ABS system to include BA, EBD, VSC and Trac.
all of these are standard in the basic price.

In addition many more features are now available. But the key point is that the vehicle is larger, safer, more powerful, more fuel efficient and most importantly the effects of inflation have been absorbed to the tune of ~ $2800.

There is no magic dust in the business of building vehicles. If all components like steel, oil, power, plastic, rubber and fabric are all going up at the rate of inflation how does Toyota - or any vehicle maker - put more into the vehicles yet keep the over all prices at half the level of inflation. With all these additions and improvements at a price that's nearly $3000 lower than it should be you can bet that efficiencies ( your term cost-cutting ) had to be employed. The other result is that you and I would be paying $20000+ for basic Corollas and $26000 for standard Camry's.

Why? Because we the buyers demanded that the makers - every maker - do this.

The former point: There is no indication that this will be anything more than a gas pedal replacement on a certain number of vehicles. Many won't even bother. I don't know the cost of the part might be but looking at the pedal it can't be all that much to replace it. The retail cost of shop labor might be in the $120 range...but internally?? I'll stick with $380 Million ...tops. This assumes that every vehicle gets done.

We'll know soon enough.

kdhspyder · November 2009

Toyota has pretty much exceeded my tolerance threshold for cost-cutting too. That has happened in the last 5-7 years. 25 years of buying Toyotas may have ended permanently for me unless Toyota does a drastic double-take in the next few years. That opinion has not been influenced at all by this latest floor mat thing, which I still say is at the limit of what the manufacturer should be responsible for (given that operator negligence and error seems to have occurred in every case).

So....how much more are you willing to pay to 'stop this cost cutting trend'?

explorerx4 · November 2009

i would add improved tailpipe emissions too.
the big gorilla in the room is that most buyers can only afford to pay a certain amount.
that changes much slower than the progress of technology or government imposed standards.

2012aveo · November 2009

In my case I am looking for an economical and hopefully reliable commuter car to compliment my primary car which is a 2001 Mercedes C240. Based on my positive experience with my 1990 Toyota Celica which I plan to keep, I feel the 2010 Yaris is the best choice for me. If not for the cost cutting trend the new Yaris may cost $2000 more than the present sticker price. Nowadays people seem to trade their cars often. I do not think Toyota or many other carmakers in 2009 design their cars with the intent they will stay with the original owner for 20 years or 200,000 miles like in the 80's for example. Even the new Mercedes C-class use cheaper materials in their interiors than my 2001.

andre1969 · November 2009

I think one reason cars might feel a little de-contended these days is that the interiors tend to be more stark than in the past. More hard plastic, less padded, soft-touch stuff. Less cloth and carpeting. Also, in some cases, possibly fewer color choices?

Also, paint jobs have been getting worse, I've noticed, in more recent years. Either that, or my eyesight is getting better. Anyway, one day, I pulled up next to a 2006 or so Accord, midnight blue, in my midnight blue 1979 New Yorker. A car from what had been, until just the past couple years, from one of Chrysler's darkest eras. Yet, that new-ish Accord had more noticeable orange-peel on it than my disco-era dreadnaught!

The paints do hold up better these days, but they seem to be put on much more sloppily. Unless maybe it's just because the shine is deeper, and with the clearcoats and such these days, it makes any flaws that much more noticeable?

But, while there are those little pitfalls, the cars are still steadily improving, for the most part.

kdhspyder · November 2009

I definitely agree here that the touch/feel content of the interiors have been sacrificed for more 'features' and safety equipment. Maybe even some of the matching of the interior panels and 'rattle elimination' measures are minimized as efficiencies or cutbacks. But there's only so much money that can be spent on a $22900 midsized auto before the price goes off into the stratosphere.

We as buyers have made our preferences known as a group; 'stuff' or top quality materials/fabrication? We've opted for 'stuff' and we're willing to listen to the occasional rattle or put up with a mismatched panel.

That being said I think that both midsized autos and compact autos have reached their maximum size level for the NA market. How big can a Malibu or Accord or Camry get before it becomes a Town Car? Safety features are adopted almost as soon as the IIHS proposes them. Interior features? How much content do we actually want/need inside 3000# vehicle moving at 75 mph? A movie theater for the driver and passenger?

My own guess is that vehicle makers now will be cranking down on the production quality and improving the quality of the interiors as prices go up little by little. JMHO.

corvette · November 2009

Could have been a bad respray job on the Accord.

One thing I've noticed is coated interior plastics that don't hold up to wear and cleaning. On my mother's Volvo S80, there was a panel on the bottom part of the dash that looked like it had some gray dirt on it, so I started to scrape it off with my fingernail, and the "dirt" got bigger. I was actually removing the ivory-colored finish of the dashboard! #@)$#()!!!

On newer cars, I also see a lot of painted silver interior trim pieces (yuck, they're tacky and they're in every new car now) and soft-touch coatings that don't hold up.

Not every cost is being cut, though. I see that Honda has seen fit to delete the prop rod and include gas-pressurized hood struts on the current Accord, but only if you get the V6. Could HID headlamps and a six-speed automatic be next?

gagrice · November 2009

The biggest fallacy in your thinking is the real cost of labor. It has gone down overall the last 2 decades compared to the cost of automobiles. So the higher priced vehicles is only making life worse for the working man. Why has the cost of cars risen. Why did they go up this year when NO inflation was detected by the Feds. No COLA for SS recipients because no rise in the COL. Yet cars are priced higher. Automobiles have gone up more than any other main stay in our economy. Technology should cost less today. Most of the electronics used in automobiles should be far cheaper today than 10 years ago. Yet they keep going up. Sounds like greed in the auto industry to me. Why is the ECU more today when a computer is far less for a much better unit? We are getting screwed by the auto industry. Both via the government and the automakers.

houdini1 · November 2009

I just got my renewal quote on auto insurance and it is up almost 35% over last year...and nothing has changed. I have been with the same company for 4 years, no tickets, no accidnets, and an 800+ credit rating. Maybe Obama should be taking this over instead of healthcare !!

This increase is hard to explain in light of other prices going down. I have a call in to my agent !!

210delray · November 2009

Now is the time to get quotes with other insurance companies. You'll be surprised at the variance in costs.

andre1969 · November 2009

Could have been a bad respray job on the Accord.

I used to think that a few years ago, but I see too many cars with bad orange peel for them to all be Earl Sheib specials. I think it's mainly the darker colors where I notice it the most, though. My '76 LeMans was repainted at some point in its life, before I bought it, and I'm not too crazy about its paintjob. Looks good from, say 10-20 feet, but when you get up close you can see the orange peel texture. However, a year after I got that car, one of my friends got an '06 Xterra in dark gray, and the orange peel on that thing was so bad that, suddenly, my LeMans didn't look so bad anymore!

Also, it may just be how the light happens to catch it. And I notice it more on the sides of cars than I do on the hood/roof/trunk.

I also hate that dulled-down, painted silver plastic crap they use in cars. I think it looks worse than that chrome trimmed plastic they used to use...at least until that chrome crap starts peeling off!

gagrice · November 2009

I thought my insurance was bad on the Sequoia going up $60 this year. That is about 7% increase. However insurance on the Sequoia is 25% less than it was on the VW Passat which cost half of what the Sequoia cost new. SUVs and PU trucks are cheaper to insure here in San Diego than cars.

07 Sequoia $900 per year
05 GMC PU $850 per year
06 Mercedes Sprinter RV $450 per year
05 VW Passat TDI $1200 per year

With a totally clean record. And I have $240 deductible on Collision. It was $500 on the VW.

andre1969 · November 2009

My insurance, up for renewal in March 2010, is currently $1,464, for my Intrepid, Silverado, and two '79 New Yorkers. It had actually fallen slightly, from $1,497 the year before. Hopefully I won't be in for a shock this coming March!

I don't know how much bearing this would have on it, but my homeowner's insurance, which is with the same company, just came due. It was $706, up slightly from $702 the year before. And that's STILL down overall. 5 years ago, when I first insured the house with my car insurance company, it was $759.

Anyway, I'm hoping my car insurance takes a trend similar to the homeowners!

doggrandma · November 2009

Trucks and SUVs are almost always cheaper to insure, because they are larger and the occupants of the vehicle are less likely to be severly injured in an accident. I have a small car, but even though it is older than my husband's car and has side air bags, it is more expensive to insure than my his Ford 500.

Our auto insurance went up this time, too. I called our insurance company and a rep told us that all rates are up for our state. The real problem is inflation. Since the government went on a spending spree, the dollar is rapidly dropping in value. Things don't cost more; our dollares buy less.

houdini1 · November 2009

I don't feel so bad now. Even with the increase my annual cost is as follows:

1. 2007 Lexus LX 470- $579
2, 2006 Lexus LS 430- $690
3. 2005 Chevy p.u. $637.

Still, it has gone up considerably in the last 2 years.

The p.u. is actually gone now, replaced by 2008 Infinity G37 Journey Coupe...I don't have the premium for it yet but expect it to be higher than the p.u.

I like the co. I am with because they write an annual policy instead of 6 months so I only have to fool with it once a year.

andre1969 · November 2009

1. 2007 Lexus LX 470- $579
2, 2006 Lexus LS 430- $690

I have a theory on why these two are going up. Generally, if a car gets into an accident, an insurance company will total it when the cost to repair exceeds 60% of the book value. Well, let's say a car was $50,000 new, but is now down to $30K. If that brand new car got into an accident that did $18K worth of damage to it, the insurance company would fix it, and be out $18K. However, if a $30K car gets $18K of damage, that's at the 60% mark, and now the insurance company is out $30K, as they've totaled the car.

The car's value will continue to go down over the years, and eventually, insurance rates should drop a bit, once it gets to the point that that 40% difference isn't so great anymore. For instance, once the car's only worth $10K, and you get into that $18K accident, the insurance company is only out $10K. Of course, you could get into a $6K accident and get totaled out, but the ins co is still only out $10K.

At least, that's my theory.

houdini1 · November 2009

Thanks for letting us get off topic a little bit. We'll bring this to an end now. Anyway, I think Toyota is doing fine in 2009 !

anythngbutgm · November 2009

One question. Will this recall make Toyota the automaker highest number of recalls for 2009?

I know that GM has led that statistic for years so it would be amazing that Toyota would the same year they took the top spot away from Government Motors. :surprise:

The top spot is cursed I tell ya! :P

210delray · November 2009

However, if a $30K car gets $18K of damage, that's at the 60% mark, and now the insurance company is out $30K, as they've totaled the car.

Just one more off-topic point: The insurance company wouldn't be out the full amount, because they'd get a good deal of salvage value out of the car.

kdhspyder · November 2009

Again you miss the point entirely.

It's not that 'the cost of technology should have gone down' in the last 10 years, it's the fact that these technologies never existed in basic midsized vehicles. They are complete add-ons in both capability and in cost.

There were 2 airbags in the 2000 model...now there are 7 airbags. 7 costs more than 2. Special technology for active headrest restraints never existed til recently.

The vehicle is bigger in every way so there's more of every material. More material means higher costs. This I do know. I was in this business. The prices of raw materials are much higher today than they was in the 80s, 90s or even at the beginning of this decade. So more material at higher prices?.....that's not too hard to figure out.

corvette · November 2009

There were 2 airbags in the 2000 model...now there are 7 airbags.

Airbag, schmarebag. They deleted the tape player! If that's not a clear example of decontenting, I don't know what is. :P

berri · November 2009

I think you'd be surprised how many low mile Toyota and Honda's are totaled after significant damage even when repairable. The parts are worth a fortune which often allows the insurance company to reduce its cost, or even make a profit, by totaling rather than repairing.

stever · November 2009

This insurance thread has got me thinking I shouldn't trade cars (or move). I'm paying $559 for two cars.

That's for the whole year (one doesn't have collision).

Not much Toyota news since everyone is waiting to see if the shortened gas pedals is going to be the recall fix. Unless you consider the Prius getting beat by the Focus newsworthy.

Ford Fusion named Motor Trend car of the year (AP)

gagrice · November 2009

That is a fact. The local shop got a salvage early 1990s tail light lens for a Camry and he handed the kid from the wrecking yard $90 cash. I wonder what he charged the customer for that red piece of plastic.

210delray · November 2009

What's Motor Trend? Are they still around?

210delray · November 2009

I agree with all you've said in this post and the preceding ones. But the Camry doesn't yet have active head restraints, like the Corolla and new Prius. It's likely the next redesign (in model year 2012?) will.

uplanderguy · November 2009

Time to take those blinders off, anythngbutgm. In either 2005-06-07, Toyota recalled as many cars as they built...millions.

Bill

kdhspyder · November 2009

HUH??? More faulty logic.

From 2002 to 2009 Toyota built 3.8 million vehicles? Your knowledge of the auto industry is severely lacking my friend. Try this statement for accuracy: in those 8 years in the US alone they sold 20-25 million vehicles*. Now you're in the ballpark.

Accuracy is important.

*This of course doesn't include China, Japan, Germany, all of Europe, the rest of Asia, all of the midEast, all of Central and South America nor any part of Australia. Just try to keep it accurate.

british_rover · November 2009

http://www.iihs.org/news/rss/pr111809.html

Missing the mark: Not a single model from the world's biggest automaker by sales is represented among this year's winners. Toyota and its Lexus and Scion subsidiaries had a strong showing in 2009 with 11 winners but were shut out for 2010. Four other manufacturers whose vehicles have earned Top Safety Pick in the past didn't have a qualifying vehicle for 2010: BMW, Mazda, Mitsubishi, and Saab. The Honda Accord picked up the award the past 2 years, but the 2010 didn't earn the required good roof strength rating to qualify (the roof is rated acceptable). The Ford Fusion is another midsize car that dropped off the list for the same reason.

New rollover and roof crush standards knocked the top safety pick list from 94 to 27 cars.

ALL 27 WINNERS

Large cars
Buick LaCrosse
Ford Taurus
Lincoln MKS
Volvo S80

Midsize cars
Audi A3
Chevrolet Malibu built after October 2009
Chrysler Sebring 4-door with optional electronic stability control
Dodge Avenger with optional electronic stability control
Mercedes C class
Subaru Legacy
Subaru Outback
Volkswagen Jetta sedan
Volkswagen Passat sedan
Volvo C30

Small cars
Honda Civic 4-door models (except Si) with optional electronic stability control
Kia Soul
Nissan Cube
Subaru Impreza except WRX
Volkswagen Golf 4-door

Midsize SUVs
Dodge Journey
Subaru Tribeca
Volvo XC60
Volvo XC90

Small SUVs
Honda Element
Jeep Patriot with optional side torso airbags
Subaru Forester
Volkswagen Tiguan

I am surprised they put the C30 on that list and not the V50/S40 as they are all basically the same car.
Ahh I see what happened the S40 needed to be able to handle four times its weight in the roof crush test and only made it to 3.92 times. The C30 while it uses the exact same platform is just a little lighter so it managed to get above four times its weight.

http://jalopnik.com/5407052/bmw-toyota-dont-make-iihs-2010-top-safety-list/galle- - ry/

gagrice · November 2009

Accuracy is important.

Not to once hopeful Presidential candidate Al Gore. Here is his statement on Conan. If Gore can be so far off on facts why should you hold us fellow posters to such a high standard of excellence. Toyota has recalled more than 3.8 million vehicles over the last 8 years. Many small recalls never make the news.

Gore in an 11/12/09 interview on NBCs tonight Show with Conan OBrien, speaking on geothermal energy, champion of slide show science, cant even get the temperature of earths mantle right, claiming several million degrees at 2 kilometers or so down. Oh, and the crust of the earth is hot too.

So accuracy is not as important as you claim. Only at tax time.

british_rover · November 2009

Huh

Seriously what does Al Gore have to do with Toyota Recalls?

I think that is going to be my new "and what does that have to do with the price of tea in China," meme.

210delray · November 2009

The big winners this year are Ford (if you include Volvo), Subaru, and VW/Audi. Most of the others have only one or two winners with the exception of Chrysler -- but who would want to buy any those Mopars: Sebring/Avenger, Patriot, and Journey?

Camry has one of the highest roof strength scores in all size classes (and good front and side ratings), but fell short in the non-life threatening rating, the rear crash (whiplash) rating. I'd pick a Camry over a Sebring in a second -- anyone else who'd really rather have Sebring? In the midsize car segment, the only class I'd look at, only the Subaru Legacy would be on my shopping list if I truly wanted one of the winners. I like the Volvo C30, but it's too pricey and seats only 4.

gagrice · November 2009

Seriously what does Al Gore have to do with Toyota Recalls?

Let me get back to you on that one. Just commenting on the stickler for accuracy comment. Since when does any blog site have standards of excellence? It would require a staff of at least 11 AP reporters to check everything we post for accuracy.

None of us want to look ignorant. Though it does happen from time to time. Just a quick check tells me that Toyota has recalled over 5.15 million vehicles this year alone. Maybe someone knows of ones I have missed. Starting in January with 1.35 million cars with defective seat belts, that can cause a fire. Hmmm that is scary.

nippononly · November 2009

I'm gratified to see that by leaving the Toyota brand this year (and going to Subaru) I stayed on the IIHS's top safety picks list....

Toyota has to get back on the ball, although I'm surprised at some of the other omissions from the list - Honda Accord? Ford Fusion? Lots of manufacturers are dropping the ball it would seem. I wonder if this is another direct effect of excessive cost-cutting.

210delray · November 2009

No, it's not cost cutting. Manufacturers fell off because of the new roof tests. The Accord and Volvo S40 were very close to Good though, and along with the Fusion still earned Acceptable ratings. You can bet manufacturers will be working on this one, and some of the near-miss cars will be back on the list within a year.

I've no doubt that if you went back to previous generation designs, the roofs would be weaker. Manufacturers have known for some time that the government would be strengthening the applicable safety standard, but they didn't know until early this year how high the IIHS would raise the bar.

anythngbutgm · November 2009

Safety is one of the biggest reasons my wife and I both drive Subies now

I don't think I have ever thought of Toyota being a leader in safety. Most of their offerings have better than average crash ratings but when I think safety, the first automaker that pop into my head are Volvo, the Germans (Merc, BMW, Audi), Ford and Subaru.

british_rover · November 2009

Let me get back to you on that one.

Gotcha Mr. Palin.

There were several near misses for cars on both the roof crush standard and the side impact test that I am sure will be fixed by the next model year or maybe even be a running production change for this model year.

The S40 missed out by just a tiny bit on the roof crush test and the side impact test. I bet the C30 did better because of the way the doors are set up being a coupe instead of a sedan. The C30 and S40 have the exact same wheelbase and the seats are in the same place too. It is just the back end that is cutoff to make it shorter then the S40.

doggrandma · November 2009

Are the roof tests the reason that all vehicles seem to be made in the same tear-drop shape with thick back roof pillars? I don't like the look, and this makes rear visibility terrible! I don't see how anyone can see out the back of a Nissan Murano, for example.

210delray · November 2009

Not at all; this is primarily a styling fad. As british rover (I believe) pointed out before, consider the Honda Element vs. the Honda CR-V. The former did quite well on the roof test with its square, upright body and pillars. The CR-V only scored a Marginal, with its sloping C-pillar and poor rearward visibility.

british_rover · November 2009

Nah wasn't me must have been someone else.

That tear drop styling is mostly part of the four door coupe fad that is going on right now. Same thing with the little mail slot windows lots of cars get with the very high beltline. Some of it comes from trying to get better aerodynamics to get better fuel efficiency but most of it is just a fad.

The thicker roof pillars are partly because of that fad and partly because of trying to stuff fairly thick side curtain airbags into them. You don't need big thick pillars to get a decent roof crush test score just look at all the Subarus that did well and they have relatively thin pillars with frameless windows.

You just have to use good engineering and small amount of stronger allows in the core of the roof pillar.

andre1969 · November 2009

Well that little reverse-slant thing with the rear windows that seems to be all the rage these days just shows that auto stylists are realizing what a masterpiece the Gremlin was, after all! :P

stever · November 2009

That's one of the best Separated At Birth? ones I've seen. :shades:

british_rover · November 2009

Yikes that is frightening. If the Gremlin just had a roof rack and no white walls it would be perfect.

210delray · November 2009

Everything old is new again, even the color!

Those reverse-slant C-pillars were common in the 50s also, but at least then the backlite wrapped around so you had only a thin pillar.

kdhspyder · November 2009

What the heck does this semi-political rant have to do with anything? How do you get away with this stuff? Besides...who cares what Al Gore thinks or says?

kdhspyder · November 2009

Subaru has always had top picks in all the IIHS categories. They do a good job.

The IIHS ratings and TOP PICK rankings are constantly moving targets.
..first it was frontal crash test ratings
..then it was frontal and side crash test ratings
..then it was frontal/side crash ratings and Stability Control
..then it was frontal/side crash ratings, ESC and Active Headrest Restraints
..now it's all of the above and roof crush strength ratings.

This is one of the reasons that the IIHS is the more important criteria for automakers and buyers. Vehicles that were top picks in the past can suddenly fall out of the ranking because the IIHS changed the rules of the game. Nothing in the Accord or Camry have changed since these Gens were introduced. The IIHS unilaterally changed its own rules.

For example from 2010 to 2011 ...
..all pickups were suddenly wiped off the TOP PICK list
..all large SUVs were suddenly wiped off the list
..80% of all the midsized SUVs were suddenly wiped off the list.
None of these vehicles changed.

Nothing new to see here. When the next Gens come out they will incorporate the new equipment that the IIHS wants. It's really that simple. No cost cutting here except that these new safety measures DO cost something. If the total cost is going to remain the same but the vehicles have to add new equipment....then something has to give. Price goes up or content goes down.

Toyota on the mend?

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