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Toyota's reputation takes some hard hits
Automaker long considered a leader in problem-free cars is now seeing its share of trouble
Wednesday, August 02, 2006

Left to right: Toyota Avalon, Prius and FJ Cruiser

By Don Hammonds
Pittsburgh Post-Gazette
Toyota Motor Corp., long known for its problem-free cars and trucks, is experiencing quality control problems in a number of its products.

Among the troubled models are Avalon, Prius and the FJ Cruiser, but it is the Avalon that has attracted the most industry attention.

Toyota introduced the redesigned Avalon in 2005, and ever since it has been beset with problems. For the Avalon, the Japanese automaker has provided service bulletins, which alerts dealers to problems, on bad U-joint welds, faulty catalytic converters and a leak in the oil supply line for variable valve timing. There also have been recalls to correct problems with air bags and the steering column on some Avalons.

Transmission hesitation problems, which have plagued the automaker in the past, also have resurfaced with the five-speed automatic transmission installed in the Avalon.

While the earlier transmission problems were experienced by consumers in a variety of situations, this round of trouble surfaces particularly when the driver presses the acceleration pedal for greater speed.

All the difficulties have resulted in the Avalon being downgrading in its quality rating to "average" by Consumer Reports.

Industry analysts caution that Toyota has to stem the tide of recalls and service campaigns -- and do so quickly -- if it is to preserve its reputation for quality.

"Toyota has developed an image of superior quality and reliability and it's helped them a great deal, so they need to minimize these occurrences, and I think they know that," said Tom Libby, senior director of industry analysis with the Power Information Network of J.D. Power and Associates.

"It takes more than a few incidents to change perceptions, and perceptions are built up over a long period of time," he added. "Toyota still has that strong quality reputation, but it just cannot let these number of instances multiply."

Toyota officials say they have been moving as quickly as possible to correct problems with the Avalon on the assembly line. But they say the recalls, service bulletins and other occurrences should not suggest that Toyota is losing its reputation for quality products.

"We see concerns, either externally or internally, and we address them," said Bill Kwong, product communications administrator for Toyota. "We have these concerns out there and we take care of our customers. It's our way of showing that we are serous about customer satisfaction, and we want to take care of these issues before they become really big issues."

He noted that the Avalon still ranks above industry averages in the J.D. Power and Associates quality control surveys. The company ranked fourth in the 2006 JD Power initial quality survey, behind Porsche, Lexus -- a Toyota brand -- and Hyundai, known more for its low prices than its quality.

Toyota also grabbed the top spot in 11 of 19 segments in the survey.

But the Avalon is not the only Toyota model experiencing quality-control problems.

Toyota launched a recall of 170,000 Prius models this month because part of the steering shaft assembly could crack or become loose.

On July 20, 367,600 Toyota Highlander and Lexus RX SUVs were recalled because of a defective carpet clip that Toyota said could interfere with the operation of the accelerator.

Also this month, 34,700 Priuses, Echos and other models were part of a recall of 418,570 cars that were made in 2001. The cause was a faulty crankshaft position sensor that Toyota said could result in a stalled engine that could not to be restarted.

"There were no reported cases of that happening in the U.S.," said Mr. Kwong. "We found out about this in an overseas model, and because we saw several cases of this happening overseas, we wanted to make sure that this did not happen to our customers here."

The latest addition to the list of Toyota products with problems is the all-new 2007 FJ Cruiser.

"We were doing quality control activities and were inspecting our vendors where we source our wheels. We noticed they were improperly mounting tires onto the wheels," said Mr. Kwong. "We launched a special service campaign involving about 9,000 FJ Cruisers and took care of our customers, replacing the tires with new tires. It's another case of our policy of continuous improvement."

Last month, the company's quality control issues sparked a rare public reprimand by the Japanese government, which called for improved recall practices amid a criminal investigation into a 2004 accident.

The transportation ministry has ordered the automaker to report to the ministry by Friday steps it is taking to better monitor reports of defects.

The company's current quality woes have generated a strong reaction on blogs and in chat rooms -- particularly among those who support buying domestic cars. They say the problems show Toyota is really no better or worse than any other car company -- including American ones -- when it comes to quality control.

"Welcome to the real world. Brag about how wonderful, trouble-free and reliable your product is all the time, make it the centerpiece of your advertising for years, when it hits a problem, it hits hard," one poster on Autoblog.com wrote.

But Toyota's supporters disagree.

"I don't know of one Toyota fan who honestly believes that Toyotas can't have problems. Just like any other manufacturer, they also have problems and recalls, etc. In general, however, Toyotas are well known for their reliability and quality for good reason," one writer wrote.

Some industry experts speculate that Toyota is experiencing quality control problems because it is growing too quickly and its attention is spread across too many product lines.

"I've heard that theory that they are growing very fast and that they have stretched their system and manpower, but I don't know that for a fact," Mr. Libby of J.D. Power said. "They are definitely in a growth mode, and they have ambitions; but whether their entire infrastructure is stretched too far, I can't say for certain, though it certainly is tempting to say that."

First published on August 2, 2006 at 12:00 am
Don Hammonds can be reached at dhammonds@post-gazette.com or 412-263-1538.
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