...UMS University of Modern Sciences Project: Toyota’s Business Environment and its Recall Policy Toyota Motor Corporation is Japan’s number one carmaker. Toyota has international presence in over 170 countries worldwide. It manufactures cars, pickups, minivans, and SUVs include models such as Camry, Corolla, 4Runner, Land Cruiser, Sienna, the luxury Lexus line, and full-sized pickup trucks. It has huge financial strength, a sales turnover of 131,511 million for 1997 and sales growth of 29.3%. It is the second largest car manufacturer in the world, after General Motors. Some of the key reasons for its success include: Successful brand - Toyota has developed a trusted brand based on quality, good performance and for being environmentally friendly. Innovation - Toyota is at the forefront of car manufacturing innovation. It was the first car manufacturer to embrace lean manufacturing (known as Toyota Production System) which is a faster, more efficient process which leads to less waste compared to the traditional batch and queue method of manufacturing. It also applied JIT (Just in Time manufacturing) and smart automation. Product Development - Key to the success in the car market is new models which stimulate demand and loyalty to the Toyota brand. Toyota has reputation for producing cars which are greener, more fuel efficient, and of good performance. Toyota has sought to meet government requirements (for reducing the impact on the environment), economic...
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...Research Question: Have the recent recalls effected Toyotas brand image? Product Description: We, as a group, chose this topic because Toyotas main slogan consists of ‘The Best Built Cars in The World’ despite having numerous recalls over the past number of years. This really appealed to us and we wanted to see how the recalls have effected potential customers of Toyota cars in Ireland. Toyota spent 33 days as the no.1 news story worldwide (24/7 wall st). We hope to learn if this negative news coverage has effected Toyotas market share in Ireland, along with Ireland’s overall view of Toyota as a brand. With this, we want to research new cars sales in Ireland over the past number of years and in particular around the months of February and March 2009 when the recalls for Toyotas reached their peak (Cole). With the large number of recalls, we also want to investigate if Toyota have changed their production practices and quality checks to prevent these large scale recalls from happening once again. Traditionally, this company had an essence of quality about its brand (Toyota-global.com) in Ireland and we want to see what Toyota Ireland is currently doing to reassure their target market that the recalls were a mere blip in the company’s overall history and Toyota are still reliable as they ever were. Along with new car sales, we also want to research the second-hand car market in Ireland and see what is Toyota’s market place is there. We felt this is important because a significant...
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...Team B Assesses Public Relations for Toyota SUA Recalls MKT/578 University Of Phoenix Team B Assesses Public Relations for Toyota SUA Recalls In August of 2009, an off duty California Highway Patrol officer and three family members died when their Lexus crashed after the accelerator pedal stuck. The car was traveling at a high rate of speed and could not be stopped according to a panicked call from the driver (MacKenzie and Evans, 2010). This tragedy kicked off a crisis for Toyota as it had to deal with accusations that a faulty accelerator pedal is what caused the crash. The company faced negative publicity from the media, the public and the NHTSA (National Highway Transportation Safety Administration) as a result of this accident and other accidents involving sudden unattended acceleration (SUA) from a stuck accelerator pedal. In response to these incidents and the publicity, Toyota eventually recalled 7.5 million vehicles to fix the stuck accelerator problem and shut down production of its effected vehicles until the problem could be solved. In this paper, Learning Team B has evaluated the role public relations played in this case and how the company could better prepare for a similar crisis. Problem Toyota realized it had a public opinion problem after numerous reports of “runaway” cars were claimed to have been caused by an accelerator pedal that would remain pressed down after the driver released the pedal. This resulted in the California accident...
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...5/19/13 Toyota Recall: Five Critical Lessons | Business Ethics You are here: Home » Business Ethics, Economy, Featured Story, Michael Connor, Recent Stories, Regulation & Legislation » Toyota Recall: Five Critical Lessons Toyota Recall: Five Critical Lessons Posted by Michael Connor • January 31, 2010 • Printer-friendly by Michael Connor Toyota’s announcement of a technical fix for its sticky gas pedals – which can lead to sudden acceleration problems - is not likely to bring a quick end to the company’s current recall nightmare. Having already halted sales and production of eight of its top-selling cars in the U.S. - and recalled more than 9 million cars worldwide, in two separate recalls – Toyota faces the prospect of billions of dollars in charges and operating losses. The Toyota brand, once almost synonymous with top quality, has taken a heavy hit. While all the facts are not yet in, it’s clear that Toyota’s crisis didn’t emerge full-blown overnight. Fixing the problem and ensuring that something like it doesn’t happen again will require an all-out effort, from assembly line to the boardroom. Even then, there are no guarantees. Maintaining a good corporate reputation in the 21st century is tricky business indeed. Toyota’s case offers a number of valuable lessons for other business people and companies to consider. Here, for starters, are five: Aggressive growth can create unmanageable risk. Toyota’s desire to supplant General Motors as the world’s number-one car-maker...
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...automobile manufacturer Toyota announces a recall in the United States of its 2010 Toyota Prius model due to issues with the car’s braking system. | 11/27/2012 11/27/2012 ------------------------------------------------- Japanese automobile manufacture Toyota announces a recall in the United States of its 2010 Prism model due to issues with the car’s breaking system. February 9, 2010 Toyota Motor Sales (TMS) U.S.A, Inc., announced it will conduct a voluntary safety recall on approximately 133,000 2010 model year Prius vehicles and 14,500 Lexus Division 2010m HS 250h vehicles to upgrade software in the vehicle anti-lock brake system (ABS). The ABS is normal operating, engages in disengages rapidly (many times per second) as the control system senses and reacts to tire slippage. Some 2010 model tear Prius and 2010 HS 250h owners have reported experiencing inconsistent brake feel during slow and steady application of brakes on rough or slick road surfaces when the ABS is activated in an effort to maintain tire traction. Toyota has responded to owners concerns with a running production change for 2010 Prius that was introduced in the past month, improving the ABS system’s response times as well as the system’s overall sensitivity to tire slippage. Toyota promises that the company is committed to do everything they can as fast as possible to restore consumer trust in Toyota and these recalls are part of the effort. The recall will allow Toyota dealers to perform...
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...Mgmt 3614 Ngan Doan- ID: KR 6228 Thursday Jan/22nd/2015 TOYOTA’S Culture and the “Sticky Pedal” Recall As we know, Toyota Motor Corp is one of the most famous and successful automaker in the United States and around the world for products quality and long term relationships with employees, vendors, customers, and other key stakeholders. Toyota nurtures continuous improvement culture, is such a strong organization, but the company has to pay $16.4 million fine “for failing to notify the Department of Transportation of a "sticky pedal" defect in its cars for at least four months, according to a senior Transportation Department official.” ( http:// CNN.COM, APRIL 19TH, 2010). Also, the company had to apologize and recall about 9 million Toyota Vehicles in 2010. The question is that why didn’t Toyota handle the crisis, public relation response and solve that important problem sooner? In my opinion I think that Toyota’s organization culture will be one of the reason why the company delayed the publically acknowledge and replace the faulty accelerator pedals. First of all, Toyota’s culture is somehow affected by Asian culture which is most of negative information and flaws are hided and kept secretly within the firm. However, most of the problems and accidents caused by the “sticky pedal” were in the United States. The company cannot use Japanese style of public relations. They can’t keep the problems secretly, and then inform the media about the whole situation after...
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...reasons of Toyota’s recall issues Lately, people most concerned about the recall event which happened on the world’s largest vehicle manufacturers, Toyota. This event affect all over the world including China, USA, Europe. The incident makes the corporate brand image dropped and also loss the consumer confidence. Why this event did occur? During the research and analysis, the major cause of Toyota’s recall is the quality issues. For example the accelerator pedal problem, many different types of car were recalled, like RAV4, Corolla and Venza and even some very good quality cars, like Lexus. In this case, from suppliers to the manufactures all have quality problems. 1.1 Suppliers Because pursue the maximum benefits and cost minimization, suppliers pay more attention on how to reduce cost. This lead to them neglects the raw materials quality. On the other hand, due to the Toyota over-confidence suppliers, the supplier changed the components’ design without permission. Some information pointed out that one of the Toyota suppliers called Chicago Telephone Supply Co. (CTS) changed the pedal design that is one of the reasons leading to the pedal problem. (Bernard Simon, 2010) 1.2 Manufactures They used the problem components to product without quality check and after the production they also did not do better quality check. They design also have some problems, they did not do enough test of their design before they produced. All these result the recall incident. This kind of...
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...Embry-Riddle Aeronautical University ERAU Scholarly Commons Economics, Finance, & Information Systems Daytona Beach 2014 College of Business The Effect on Stockholder Wealth of Product Recalls and Government Action: The Case of Toyota's Accelerator Pedal Recall Jayendra Gokhale Embry-Riddle Aeronautical University - Daytona Beach, gokhalej@erau.edu Raymond M. Brooks Oregon State University Victor J. Tremblay Oregon State University Follow this and additional works at: http://commons.erau.edu/db-accounting Part of the Business Administration, Management, and Operations Commons, Finance Commons, and the Management Information Systems Commons Scholarly Commons Citation Gokhale, J., Brooks, R. M., & Tremblay, V. J. (2014). The Effect on Stockholder Wealth of Product Recalls and Government Action: The Case of Toyota's Accelerator Pedal Recall. The Quarterly Review of Economics and Finance, 54(4). http://dx.doi.org/10.1016/ j.qref.2014.06.004 This is the submitted author’s version that was accepted for publication in The Quarterly Review of Economics and Finance. Changes resulting from the publishing process, such as peer review, editing, corrections, and formatting are not reflected in this document. Changes may have been made to this work since it was submitted for publication. The published version is available at http://dx.doi.org/10.1016/j.qref.2014.06.004. This Article is brought to you for free and open access by the College of Business at ERAU Scholarly...
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...July 3 – 6, 2012 Car Recalls: A Problem Unique to Toyota or For All Car Makers? Kamrul Ahsan School of Management and Information Systems, Faculty of Business and Law Victoria University Australia Abstract Often automobile recalls are drawing media and public attention. Influenced by Toyota’s recent automobile recalls 2009-2010 this research conducts an empirical study on historical car recalls. The research uses secondary data from recall websites maintained by public and private organizations. For different car model year and manufacturer the study looks at frequency of recalls, recorded customer complaints, and yearly sales data. Analysis shows recalls are a common event with the majority of recalls initiated by only a few car makers. Though car makers use many eye catching and popular quality and customer care slogans and programs, many popular car makers still face valid customer complaints and consequently face many unwanted recalls. This study identifies that most recalls occur during the first five years of the car model year. This preliminary study of automobile recalls can be further extended at a later stage to identify key causes of recall. Keywords Product recalls, Reverse logistics, car recalls, product returns, closed loop supply chain 1. Introduction Though manufacturers use state-of-the-art operations philosophies, tools and techniques, it is difficult to make the perfect product and products often need to be recalled. Recalls occur when the customer...
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...university name | Safety Recalls | With reference to Toyota | | Your Name Course TitleInstructor Name | [Pick the date] | Introduction Toyota has officially announced that it will recall 2010 model Prius and Lexus HS250h models globally along with the Toyota models in Japan to fix an issue the performance of their braking systems. The latest in a series of safety related problems with Toyotas became public fodder last week when Toyota acknowledged that customers of the third generation hybrid had complained of a loss of stopping power at low speeds. Safety Recalls, Outsourcing and Inconsistent Competitive priorities Safety recalls are indicators of problems regarding quality management in the operations management of an organization. In Toyota safety recall the company has planned to rectify the problem by recalling the car but the customers may be busy with their work and undergoes lot of mental agony before the problem is rectified. When an organization outsources spare parts especially in automobile industry many suppliers will be supplying parts for organizations. The quality control will be an issue if numbers of suppliers are more in number. The inconsistent competitive priority is also another cause for quality issues. Questions 1Q. How has operations strategy and competitive priorities evolved in the automobile industry during the last 100 years? A: There is no competition in the automobile industry before Second World War. The American automobile...
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...Preferred Courses of Action Through Ethical Analysis of the 2009 Toyota Motor Company Automobile Recall In September 2009, Japanese automotive manufacturer Toyota issued a recall of 3.8 million vehicles due to “unintended acceleration” that was believed to be caused by loose floor mats becoming lodged under the gas pedal due to a design flaw in the pedal layout. Since the initial recall, which affected seven models ranging from 2004 to 2010, more details have emerged. Instances of surges in acceleration in Toyota vehicles have been investigated by the NHTSA on six separate occasions since 2003 and over two thousand owners have claimed to experience the phenomenon. Consumer Reports examined cases of unintended acceleration surges in the United States for 2008 and forty-one percent of all instances involved Toyota vehicles. Most tragically, sixteen people have been killed in accidents resulting from unintended acceleration in Toyotas and over two hundred-forty have been injured. As a short-term fix, Toyota brand dealers began removing floor mats or fastening them to the floor pan in order to prevent lodging under the accelerator. More recently, dealerships have begun reshaping or shortening accelerator pedals until replacements become available for installation. However, some consumer groups have criticized Toyota’s sluggish and secretive response, and a national class-action lawsuit has been filed against Toyota alleging that the floor mats and pedal layout do not explain...
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...Business/ Reputation 4. If I am the new Ceo( Chief Executive Officer) of the company what kind of actions I am going to undertake? [pic][pic] [pic] 1. From 2009 to 2010, Toyota recalled millions of cars for accelerator pedal sticking. The first recall, on November 2, 2009, was to correct a possible incursion of an incorrect or out-of-place front driver's side floor mat into the foot pedal well, which can cause pedal entrapment. The second recall, on January 21, 2010, was begun after some crashes were shown not to have been caused by floor mat incursion. In March 2010, at the time of the recall, Toyota was unsure of the cause behind a spate of cars that would speed up without the driver's help. Hybrid’s breaking systems: Prius owners have reported that brakes momentarily fail when driving in icy or slippery conditions, or over potholes. Normally the anti-lock braking system engages and disengages many times a second as the system reacts to the slipping tyres. But - as Toyota puts it - some drivers have complained of "inconsistent brake feel" during slow and steady braking on some surfaces when ABS is activated.The solution involves an upgrade of the software in the braking system, which should take less than an hour and will be carried out for free by official Toyota service centres. Toyota stresses that the cars are still safe to drive and the brakes will stop the car. US safety authorities, however, have said they have received reports of accidents, including a small...
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...Business Communications In 2009, Toyota was accused of ignoring safety concerns in regards to faulty brakes and acceleration pedals which sent the car manufacturer into a public relations crisis. Toyota continued to blame the sticking pedals on faulty floor mats, not electrical error and was found to delay the recall process in order to save money. In order to avoid a massive recall, Toyota ignored Consumer complaints and recalled limited amounts of vehicles during different times in the year while “producing new vehicles with known safety flaws and advertising their vehicles to be the safest and highest quality vehicles on the road” (“Associated Press”, 2010). Building Back Credibility As one of the largest and best selling automotive manufacturer, Toyota lost its credibility by not being forthcoming with all the Consumer complaints received. Toyota was found to have put saving money before Consumer safety. Being a large company with many Consumer’s relying on their automobiles, Toyota is obligated to give back to its Consumer’s by being honest and putting the Consumer’s at ease by letting the Consumer’s know that their concerns are being addressed. In 2010, Toyota was ordered to appear in Congress to face questions about their conduct in recalling of vehicles. During the hearing, Toyota “finally admitted to engaging in unethical behavior when it comes to investigating the safety of its vehicles” (Mack, 2010). This was the first admission from Toyota that they were wrong in the...
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...& Recommendations | 10 | 7 | Bibliography | 14 | INTRODUCTION Toyota Motor Corporation, is a Japanese multinational automaker headquartered in Toyota, Aichi, Japan. In 2010, Toyota Motor Corporation employed 317,734 people worldwide, and was the world's largest automobile manufacturer by production. The company was founded by Kiichiro Toyoda in 1937 as a spinoff from his father's company Toyota Industries to create automobiles. TMC is part of the Toyota Group, one of the largest conglomerates in the world. It created its first product, the Type A engine, and, in 1936, its first passenger car, the Toyota AA. Toyota Motor Corporation group companies are Toyota (including the Scion brand), Lexus, Daihatsu and Hino Motors, along with several "non-automotive" companies. Sakichi Toyoda invented the Toyoda Model G Automatic Loom in 1924 incorporated the principle of Jidoka, which means that the machine automatically stops itself when a problem occurs, later becoming a part of the Toyota Production System. RESEARCH PROBLEM: Toyota has long been recognized as an industry leader in manufacturing and production. Toyota's management philosophy has evolved from the company's origins and has been reflected in the terms "Lean Manufacturing" and Just In Time Production, which was instrumental in developing Toyota's managerial values and business methods collectively known as the Toyota Way. In 2010, the Toyota Motor Corporation ranked first by the International Organization of Motor...
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...Innovation and Business Development Toyota Crisis: Management Ignorance? – A Swedish Case of Consumers Perceptions Master’s Dissertation in Management of Innovation and Business Development, 15 ECTS Final seminar 2010-05-27 Authors: Yuanyuan Feng Supervisor: Mike Danilovic Hamlstad University Feng(2010) TOYOTA CRISIS: MANAGEMENT IGNORANCE? – A SWEDISH CASE OF CONSUMERS PERCEPTIONS Yuanyuan Feng School of Business and Engineering, Halmstad University, Sweden Abstract Since the late 2009, the famous vehicle manufacture Toyota has suffered a severe crisis due to unintended quality problems in its cars which had triggered Toyota’s largest officially recalls of its cars around the world. This crisis threatens the company’s previous reputation of good quality cars, as well as the brand image built up over time. This study aims to elaborate on the Toyota crisis in order to understand why Toyota faces this crisis and how they deal with the crisis; and investigate consumers’ perceptions of Toyota brand as the outcome of the crisis, with a focus on Swedish market. A qualitative research along with a number of face-to-face interviews with Toyota Swedish dealer and Swedish vehicle consumers is conducted. The findings reveal that the impact of the Toyota crisis in Sweden is not as serious as that in America; there remain satisfied and loyal Toyota’s customers who are not swayed by the negative publicities; While Toyota should manage the crisis even in...
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