john
2009-11-26 17:12:33 UTC
November 26, 2009
Howes: Toyota not looking so shiny now
DANIEL HOWES
Is the Toyota Motor Corp. juggernaut losing its conqueror-of-the-world
mojo?
Because if it was a Detroit automaker that was recalling 4.26 million
vehicles to repair accelerator problems, or if it was a Detroit
automaker that had broken its historic no-plant-closings pledge, or if
it was a Detroit automaker that had recalled more vehicles (2.38
million) in 2005 than it sold in the United States that year (2.26
million), the answer would be an emphatic yes.
The answer also would be yes if Toyota, an earnings powerhouse,
suddenly stopped minting cash -- notwithstanding the three-month
period ended Sept. 30 -- and was on track to lose billions more this
year. The answer would be yes if its exponential market share gains
suddenly slowed, or if its national rival, Honda Motor Co., kept
delivering profits despite a global auto recession and its new South
Korean rival, Hyundai-Kia, continued to grab precious U.S. market
share.
News flash: The men running Toyota appear to be mortal. They overreach
and make mistakes. Their vehicles are not flawless. Their engineers
cut corners, at least in ways that garner the attention of the
National Highway Traffic Administration. Their Camry no longer is the
undisputed king of midsize cars, now that rivals Ford Motor Co. and
even General Motors Co. are proving they can produce world-class
metal, too.
This isn't new, either, suggesting that Toyota's troubles may be more
of a developing pattern than a one-time aberration. Two years ago,
before two-thirds of Detroit's automakers were tempered by the fires
of bankruptcy, the editor of the ostensibly "Japanese-loving" Consumer
Reports apologized to readers for recommending the problem-plagued
Camry V-6.
He also said the magazine had decided new Toyota models could no
longer be given the benefit of the doubt -- or its prized
"recommended" label. And Toyota's V-8 powered Tundra four-wheel drive
pickup was labeled "unreliable" by the magazine, the unofficial Bible
to discerning car and truck buyers.
Two years before that, the global industry's gold standard for quality
recalled more vehicles in the United States than it sold in the United
States. There have been running customer complaints about sludge in
its engines, and, more recently, growing federal skepticism over
Toyota's response to the unintended acceleration probe.
'Grasping for salvation'
Infallible they aren't, as CEO Akio Toyoda, a scion of the founding
family, conceded last month. Toyota, he said, is nearing "capitulation
to irrelevance or death" and is "grasping for salvation." He also said
the still cash-rich automaker has grown too arrogant on "the hubris
born of success" and the "undisciplined pursuit of more."
Even adjusting for the Japanese cultural proclivity for excessive
apology freighted with humility, those are stunning statements coming
from a Toyota CEO. Considering that his name, save one letter, is on
the proverbial building, the admissions are even more revealing.
Which means what, exactly?
That the Great Recession, the accelerant that pushed GM and Chrysler
Group LLC into bankruptcy and fueled Ford's evident resurgence, also
is rebalancing the automotive landscape in ways that seemed impossible
just a few years ago.
Fresh from federally induced bankruptcy, GM's labor costs are
competitive; its product portfolio is solid; its footprint in
developing markets is impressive; and its debt load is enviably small,
making it a potentially formidable competitor able to generate cash
once the worst of the auto sales depression passes.
Ford arguably is building its best vehicles in a generation, if not a
whole lot longer. The Blue Oval is booking monthly gains in its share
of the U.S. market, an accomplishment seemingly reserved exclusively
for Toyota not too long ago.
And Toyota's position as the undisputed quality leader and industry
juggernaut clearly is in jeopardy. That's change you can believe in.
***@detnews.com">***@detnews.com Daniel Howes' column runs
Tuesdays, Thursdays and Fridays
© Copyright 2009 The Detroit News. All rights reserved.
http://detnews.com/article/20091126/OPINION03/911260331
Howes: Toyota not looking so shiny now
DANIEL HOWES
Is the Toyota Motor Corp. juggernaut losing its conqueror-of-the-world
mojo?
Because if it was a Detroit automaker that was recalling 4.26 million
vehicles to repair accelerator problems, or if it was a Detroit
automaker that had broken its historic no-plant-closings pledge, or if
it was a Detroit automaker that had recalled more vehicles (2.38
million) in 2005 than it sold in the United States that year (2.26
million), the answer would be an emphatic yes.
The answer also would be yes if Toyota, an earnings powerhouse,
suddenly stopped minting cash -- notwithstanding the three-month
period ended Sept. 30 -- and was on track to lose billions more this
year. The answer would be yes if its exponential market share gains
suddenly slowed, or if its national rival, Honda Motor Co., kept
delivering profits despite a global auto recession and its new South
Korean rival, Hyundai-Kia, continued to grab precious U.S. market
share.
News flash: The men running Toyota appear to be mortal. They overreach
and make mistakes. Their vehicles are not flawless. Their engineers
cut corners, at least in ways that garner the attention of the
National Highway Traffic Administration. Their Camry no longer is the
undisputed king of midsize cars, now that rivals Ford Motor Co. and
even General Motors Co. are proving they can produce world-class
metal, too.
This isn't new, either, suggesting that Toyota's troubles may be more
of a developing pattern than a one-time aberration. Two years ago,
before two-thirds of Detroit's automakers were tempered by the fires
of bankruptcy, the editor of the ostensibly "Japanese-loving" Consumer
Reports apologized to readers for recommending the problem-plagued
Camry V-6.
He also said the magazine had decided new Toyota models could no
longer be given the benefit of the doubt -- or its prized
"recommended" label. And Toyota's V-8 powered Tundra four-wheel drive
pickup was labeled "unreliable" by the magazine, the unofficial Bible
to discerning car and truck buyers.
Two years before that, the global industry's gold standard for quality
recalled more vehicles in the United States than it sold in the United
States. There have been running customer complaints about sludge in
its engines, and, more recently, growing federal skepticism over
Toyota's response to the unintended acceleration probe.
'Grasping for salvation'
Infallible they aren't, as CEO Akio Toyoda, a scion of the founding
family, conceded last month. Toyota, he said, is nearing "capitulation
to irrelevance or death" and is "grasping for salvation." He also said
the still cash-rich automaker has grown too arrogant on "the hubris
born of success" and the "undisciplined pursuit of more."
Even adjusting for the Japanese cultural proclivity for excessive
apology freighted with humility, those are stunning statements coming
from a Toyota CEO. Considering that his name, save one letter, is on
the proverbial building, the admissions are even more revealing.
Which means what, exactly?
That the Great Recession, the accelerant that pushed GM and Chrysler
Group LLC into bankruptcy and fueled Ford's evident resurgence, also
is rebalancing the automotive landscape in ways that seemed impossible
just a few years ago.
Fresh from federally induced bankruptcy, GM's labor costs are
competitive; its product portfolio is solid; its footprint in
developing markets is impressive; and its debt load is enviably small,
making it a potentially formidable competitor able to generate cash
once the worst of the auto sales depression passes.
Ford arguably is building its best vehicles in a generation, if not a
whole lot longer. The Blue Oval is booking monthly gains in its share
of the U.S. market, an accomplishment seemingly reserved exclusively
for Toyota not too long ago.
And Toyota's position as the undisputed quality leader and industry
juggernaut clearly is in jeopardy. That's change you can believe in.
***@detnews.com">***@detnews.com Daniel Howes' column runs
Tuesdays, Thursdays and Fridays
© Copyright 2009 The Detroit News. All rights reserved.
http://detnews.com/article/20091126/OPINION03/911260331
