TOYOTA RECALL

Slide 1:

TOYOTA RECALL FOR SUDDEN UNINTENDED ACCELERATION 2009-2010 Ryan McDonnell

Slide 2:

HISTORY Toyota Motor Sales began its U.S. operations in 1957 Initially offered unsuccessful Toyopet model: Subsequent popular car models include: Corona sedan in 1965 Corolla in 1966 Camry in 1980 Prius (hybrid) in 1997 In addition, Toyota has developed a number of trucks, minivans, concept cars and the Lexus (1986) and Scion (2003) brands

MISSION STATEMENT::

MISSION STATEMENT: “To attract and attain customers with high-valued products and services and the most satisfying ownership experience in America." VISION STATEMENT: "To be the most successful and respected car company in America."

SPECIFIC CHALLENGE::

SPECIFIC CHALLENGE: SUDDEN UNINTENDED ACCELERATION November 2009 – 4.2 million vehicles recalled due to floor mat entrapment January 2010 – 2.3 million vehicles recalled due to faulty accelerator pedals (Of those, 2.1 million were already involved in the floor mat recall) It was reported in February 2010 that the Toyota Company was aware of the problem for several months before putting the recall into effect As many as 89 deaths were thought to be linked to unintended acceleration according to the NHTSA

SPECIFIC DETAILS OF THE PROBLEMS:

SPECIFIC DETAILS OF THE PROBLEMS According to the NHTSA, the initial problem resulted when the accelerator pedal was depressed to, or almost to the floor, during sudden acceleration. It can become trapped in the fully open position by an out of position floor mat. The problem was later identified as a possible mechanical sticking of the accelerator pedal As of February 2011, approximately 14 million cars worldwide have been involved in these recalls

SOLUTIONS:

SOLUTIONS Toyota’s remedies: Accelerator pedal reconfigured by the dealers to shorten it Development of replacement pedals for the vehicles (available for some models in April 2010) Offering owners who chose to have their pedals reconfigured would be offered the replacement pedal when it became available

Slide 7:

Providing all-weather floor mats Installation of a brake override system on certain models – enabling the car to stop if both the brake and the accelerator were pushed simultaneously

Slide 8:

Their reputation as the highest quality auto maker Their loyal customer base as a result of the negative publicity A significant amount of money in fines imposed by the government and from lawsuits brought by the victims or their families A drop in the value of their stock as a result of the problem WHAT TOYOTA STOOD TO LOSE

How Did the Public React?:

How Did the Public React? In January 2010, Toyota's U.S. sales dropped 16% and their stock surrendered $21 billion of value in a week J.D. Power and Associates 2010 study: 19 percent of U.S. new car buyers surveyed avoided Toyota because of the bad reputation associated with the recall The Transportation Department announced in April 2010 that it would propose fining Toyota $16.4 million in fines Many lawsuits from victims and their families are yet to be settled Despite a drop in sales, the company was still the number one retail seller for 2010

TOYOTA’S RESPONSE:

TOYOTA’S RESPONSE Communication between the company and customers, dealers and the government will be improved A Star Safety System and their Smart Stop Technology will be placed on all vehicles A Design Quality Innovation Division was established and 1,000 of the company’s finest engineers were transferred to that division to look at each component and each system to make sure that it is the most reliable and durable that it can be The company expanded their development cycle by an additional four weeks so that they will have enough time to test the entire vehicle as a system

Slide 11:

Congress requested that the NHTSA conduct an investigation of the Toyota acceleration problem NHTSA enlisted NASA engineers to conduct the research NHTSA also launched a study involving the National Academy of Sciences (NAS) to review unintended acceleration and electronic vehicle controls across the automotive industry GOVERNMENT INVESTIGATIONS

RESULTS OF THE investigation:

RESULTS OF THE investigation In February 2011, results of the study conducted by NASA engineers indicated no electronic-based cause for unintended high-speed acceleration in Toyotas Sticking accelerator pedals and a design flaw that allows accelerator pedals to become trapped by floor mats are the only known causes for these unintended accelerations The second study by the NAS study remains under way

Slide 13:

RECOMMENDATIONS OF THE NHTSA By the end of 2011 to require: Brake override systems Standardized operation of keyless ignition system Data recorders in all passenger vehicles Research on reliability & security of electronic control systems Research on placement & design of accelerator & brake pedals and driver usage of these pedals

Slide 14:

WHAT THE TOYOTA COMPANY & THE AUTOMOTIVE INDUSTRY LEARNED Toyota leadership - more involved in day to day operations Deal with issues immediately Safety training and control is of the highest priority Customer feedback is extremely valuable Continuously focus on the quality of the product