GM Melts Down Again On Windshield Washer Fluid Heaters And The Resulting Recalls

June 8, 2010

Today GM issued a second recall for the heated windshield washer fluid system found in Cadillacs and Buicks. In a small number of cases the system was causing fire.

While it is a small feature, it has been one of those little things that made a good luxury car stand above its peers and build model loyalty. Being able to melt away ice is an extremely nice touch…assuming it doesn’t burn your vehicle to the ground.

Yet when it seems that GM is finally pulling its head out of its collective ass, it goes and falls back into old habits. When the system was first recalled for fire dangers two years ago, dealers installed fuses to cut power in the event of a short. Turns out that this was a knee-jerk bandage that nobody had tested fully for efficacy. (This is what I now refer to as a “floor mat fix” for Toyota’s stupid assumption that tossing floor mats into the trunk would solve unintended acceleration problems.)

So now that the fire risk is still there, GM is simply disabling the feature “under warranty” and paying people $100 for the inconvenience. This is so typical of GM and Ford — if something doesn’t work and it might cost time and money to fix, simply take the most immediate and short-term cost-effective path. When Ford recalled Expeditions for faulty cruise controls, the fix was to disable them. After years of listening to thousands of fifth-generation Corvette owners complain about faulty column locks not releasing steering wheels, GM didn’t fix the steering lock, rather they updated the fuel management system to ensure that nobody could actually drive when the column lock jammed. Now many of these Corvette and Expedition owners are former GM and Ford clients.

As for the $100 rebate, one has to wonder if this is less than the price paid by buyers of cars with the feature…and before people start writing in about it being “standard equipment”, the price of all features are simply built into the price — usually with a nice markup.

If GM wants to be treated like a big-boy company again, it needs to stop making childish mistakes. BMW, Audi and Mercedes wouldn’t disable any feature with which it found problems, much less one considered a competitive advantage, so why would GM? Instead of wasting money paying $100 to each owner (although I understand that given the mediocrity of some of the so-equipped models that the number of owners is relatively small), cancel the country club weekend, have the executive assistants hold all calls, and actually FIX THE FREAKING PROBLEM. After that, spend the next week testing it until everyone is dead-ass certain the issue is gone for good.

At the end of the day, if GM is to revolutionize the world with the Volt plug-in hybrid technology (which is slated to eventually power every front-wheel-drive car GM produces,) it needs all the consumer confidence it can get. How can buyers trust a car running on troublesome and fire-prone lithium ion batteries at high voltage if it comes from a company which is either incapable or unwilling to make high school techonolgy-level hot water bottle heater circuits work safely?


Conspiracy Theorists Unite: Are Toyota’s Problems A Part of The US Government Stimulus Plan?

February 22, 2010

I’m going to throw a Flintstone wooly mammoth-sized bone to the conspiracy theorists out there. It is possible that Toyota’s recent problems are rooted in a plot by the US government to recoup its investment in GM and spur job growth in other American factories related to domestic auto production?

Simply put, America has a lot riding on the success of GM and Ford. For starters, there’s the bailout cash thrown at GM. (Hey, what’s five or ten billion dollars between friends?) Then there are the hundreds of thousands of jobs directly related to auto production…and millions indirectly linked.

Of course, one cannot discount the ego factor. In a country where American Exceptionalism is a religion (albeit, usually by the most world-average examples of our society), the fact that Toyota was the best selling brand has the flag-waving Camaro-driving masses (who don’t realize the all-American Camaro has long been built in Canada) close to total cardiac arrest.

So one must ask: what is the easiest way to stimulate GM and Ford’s sales, creating more jobs to meet higher demand, and allowing GM to repay its loans from the government? The answer seems to be: take out number one Toyota.

“Attack your competitor’s largest strength” is right from the Karl Rove playbook. In Toyota’s case, its sales are based on a long-standing reputation for quality. Unlike Ford and GM, which can only advertise their own individual wins in quality surveys, good old Uncle Sam can annihilate a reputation with one good press conference. After all, the regulators at the National Highway Traffic Safety Administration can put into doubt everything you’ve believed about a vehicle and the company that produced it by issuing a well publicized recall with some additional words about a possible cover-up.

Over 400 million vehicles have been the subject of automotive recalls since 1966. That’s an average of almost 9.1 million recalled vehicles every single year. There are about four million Toyotas involved in recalls right now, and that number could climb if the Corolla is recalled. Keep in mind, though, that over 14 million Fords were recalled for faulty cruise control units that could literally catch fire with the vehicle inactive in a garage and burn down a house while the owners slept.

While the Ford recall (as well as the Ford Explorer/Firestone tire one) were top news for a while, neither had the government calling into question the automaker’s business practices in a similar way to the current Toyota recall. Indeed, for a fairly limited number of reported issues, the company’s best-selling products have been tainted. Basically, the only Toyotas of mass interest not on the list are the Sienna minivan and the company’s Tundra and Tacoma trucks.

Kill number one, make Ford and GM leaders again and promote American financial interest. Sounds plausible, huh?

Actually, conspiracy theorists and anti-government types — maybe it’s just that Toyota has been producing cut-cornered products for years and it has taken America decades to cut through the marketing to realize that Toyota is really no better than Ford, GM, Chrysler, Honda, Hyundai, or Nissan. Tell people enough times that something is high quality, and even when it isn’t working right, the owners will ignore the issue and maintain the illusion. Perception is exactly how JD Powers surveys for initial and long-term vehicle quality can time-and-time-again find huge differences between nearly identical badge-engineered vehicles from different brands.

At least Toyota can rest peacefully knowing that whether its quality issues are real or a government conspiracy, people have been buying Land Rovers and VWs for over a half-century, and they’ve always been made like crap.


Toyota’s Newest Television Ad

February 8, 2010

I caught Toyota’s new mea culpa television advertisement this morning. Evidently, it has been running on such high-rotation that people are starting to think it’s the video for the latest Beyonce song.

The advertisement is such a boilerplate corporate job that it almost looks like a Saturday Night Live parody. It starts out with black and white photos from the earliest Hollywood Toyota dealership. Quickly it moves to shots of good old red-blooded Americans building Toyotas in the factory.

Since video is nothing without audio, there’s the requisite soothing piano to calm the scared and frustrated nerves of the customer. Then the ace-in-the-hole: the smooth-voiced narrator pulls out the “we’ve let you down…we’ve let ourselves down”. All we’re missing here is the crying Native American chief for pure cheese-effect.

As an automotive journalist who witnessed his first television advertisement copy (for the local Diabetes Bike-A-Thon) aired while in fourth grade, I give the Toyota spot a solid C-minus. It lacks creativity, context, and looks and sounds like a big corporation that is sorry for getting caught.

Instead of the bogus mea culpa, Toyota would have been much better-off doing a quick explanation of its problems. Just off-hand (really– just stream of consciousness), I’d think about something also along the lines of “there are thousands of parts and hundreds of thousands of lines of computer code that go into making any modern car run. Every model from all makes has parts fail, resulting in technical service bulletins and even recalls. However, at Toyota we’re known and have staked our reputation on being better than the rest. Recently we’ve discovered that a couple of parts and a few software commands were not created to the standard we require, so we’ve engineered fixes and along with our factory-supported dealerships, we’re going to get them into every Toyota…quickly, safely and with no excuses.”

I would also add somewhere that “this is not the fault of the hard-working men and women on the production lines.” After all, the failures have been in the engineering of the parts and software, not how they were assembled.

At the end of the day, it’s a hard line to walk for a company. It needs to admit fault and ask forgiveness, but it also can’t scare people into thinking that this a more dangerous, more widespread problem than it really is. Of course, when a company shuts down its production lines, halts sales of many of its vehicles and has the nightly news programs talking about stuck throttles and no brakes, there’s really little way of making it sound any worse…

…unless your apology sounds like parody.


Toyota’s Uphill Battle — With Stuck Throttle And No Brakes

February 4, 2010

In the last week or so it seems I get more questions about Toyota from readers than I do requests for sweets from my children. Whether it’s about the sticking accelerator recall, the Prius braking issue, the five-speed automatic transmission software maladies, or the effect of all these on Toyota’s long-term health, there is no lack of interest out there in getting good answers.

There are two big factors at play that the evening news and even automotive magazines don’t want to talk about (and, of course, I will). The first has something to do with the demographics and psychographics of Toyota and Lexus buyers — they aren’t, on average, “car people”. Indeed, I’ve long referred to Toyotas and Lexus vehicles as “cars for people who don’t like cars”. Obviously this is a gross generalization, as I’m a die-hard car guy and when I’m not piloting something stupid like a Corvette, Ferrari, Triumph, or old truck, I’m driving my kids to school in an ’06 Avalon. The prime market for Toyota, however, has been people not looking for a vehicle for fun or to fulfill an ego need, but rather as a safe, reliable, ergonomic appliance to get them reliably and economically from point A to point B.

Consequently, Toyota and Lexus owners generally don’t have a good understanding of automotive technology and/or history from which to draw conclusions regarding the current issues. While the Toyota (and especially Lexus) ownership group compares well to competitors’ in terms of academic and professional success, these are not people who are going to research issues within context of the industry. They just want to know a) if there is a problem that affects them, b) if it does when it can be fixed, and c) if the car is safe to drive until said solution can be implemented. If any part of the explanation isn’t clear…which it has not been, then the problem is compounded.

This is just half of Toyota’s dire big picture situation, though.

The other factor is that Toyota and Lexus have reached leadership positions in their respective classes based almost entirely on the image of quality. People haven’t been buying Camrys, Siennnas, ES350s, or Highlanders for their speed, luxury, handling, or sex appeal. Hell, even the Lexus LS series has been developed as a reliable, lower-cost alternative to Mercedes S-Class (with derivative styling, to boot).

So in the absence of this core value proposition, consumers have no reason to buy a Toyota or Lexus.

Talking heads have put blame all over the place — from design failure on the part of the OEM pedal supplier to an internal management structure overwhelmed by far too rapid market growth. Based on my traditional business education and years in management, I’d call these knee-jerk catch-all diagnoses (like “spastic colon” or “irritable bowel”) rather than meaningful analysis of strategic and tactical failures.

There are tremendous challenges for Toyota going forward. First, they have to identify what is actually causing all of the accelerator and braking issues in its cars, then they have to figure out how to actually fix millions of cars quickly.

Next they have to identify the source of the product management issues that led to the failures. In modern times quality is defined as the failure rate engineered into any given component, because while it is possible to make anything fail-safe, the cost to do so is unreasonable from a business case standpoint. That said, an analysis needs to be done for each failure of how the culprit system was engineered and if the malfunction can find a causal or associative relationship with a specific benefit like increased profit, better mpg, use of a preferred business supplier.

Most importantly, Toyota has to fix the self-inflicted damage done to its reputation…and it better start really quickly. Obviously this begins with solving these issues in all of its vehicles, but it also needs to include the shortcomings in its problem-reporting process, which according to Toyota Media Manager Bill Kwong completely and entirely disregards third-party collected information, even if it is a consumer complaint site with thousands of confirmed, actionable reports. Toyota will only consider and act on information reported from dealers via district managers and from the miniscule percentage of owners who use the toll-free Toyota Customer Service hotline.

Finally, what nobody else has brought up (so allow me to do so), is that Toyota must then move beyond marketing one-trick ponies. One can’t sell only on the basis of quality if quality is in doubt. As for the two cars in Toyota’s lineup that aren’t marketed based on quality alone, the Corolla and Prius: I have two words: Chevy Volt. You can’t sell only on gas mileage once these models look like Bugatti Veyrons at wide-open-throttle compared to the Chevy Volt’s 200-mpg.

At the end of the day, the moment the US Secretary of Transportation went on record saying Toyota, with its perceived primary value proposition of quality, not only now suffers severe safety issues across the majority of its product offerings, but also systematically worked to hide the problem from regulators and avoid recalls…well, this is a disaster of Andy Dick at Mardi Gras proportions. Excuses and blocking the truth is something Americans expect from Ford (Pinto and Mustang gas tanks, Explorer rollover issues, fire-starting cruise controls, Crown Vicky stuck accelerators) and GM (side-saddle gas tanks, bad steering and motor mounts in the early 1970s), but not from Toyota.

Actually, it isn’t a disaster for everyone. Ford and GM sales are up. And come to think of it, Audi has to be happy that “unintended acceleration” will no longer be associated only with its brand.

And just like Audi, Toyota can expect to spend millions of dollars and decades of time to repair the damage to its reputation. Might we suggest taking a page from Audi’s book and engineer in performance, design, ergonomics, image, luxury…and also quality. If there’s one thing that Land Rover and Fiat have proven time and time again, people will buy the least reliable vehicles on the market, provided said vehicle offers more to the driver than the perceived or actual quality of its parts.