As the news broke last winter of the massive recall at Toyota focus immediately shifted to the mechanical failures that plagued drivers. However the real failure was a corporate structure so rigid and so enamored with the success of the past decade that they lost touch with the customer base. In many ways Toyota rivaled the failures of General Motors during the previous decade.
When Toyota first announced the recall there was widespread panic. Later information on the Toyota recall site clarified the situation. In total millions of vehicles were recalled and in the subsequent months it has become clear that the problems had existed for years but had either been ignored, missed or swept under the rug by management. Much like the failures at Ford, General Motors and Dodge during the later part of the last century there was an inability on the part of top level management to recognize the simple fact that customers would eventually revolt if product quality dropped in a significant way. The car business is not a field of dreams if you build it they may come to you one time but will quickly jump to other brands if quality is poor. Toyota will find out in the coming months and years that the cost of fixing the problem whether real or imaginary several years ago will be dwarfed by the costs of fixing the damage to their reputation both among customers and of course dealers.
Car sales rose by a significant amount in March largely supported by immense incentives. The costs of these incentives are known only to the manufacturers but it will likely far exceed the costs of repairing the problem years ago. As the economy grows the question will be whether or not customers continue to choose Toyota when the incentives diminish and even more whether Toyota is now relegated to steep incentives that it never had to give previously.
