Assignment
For many years, Toyota set the standard for quality and reliability. However, Toyota's success was cut short by a desire to grow rapidly at the expense of quality. A few years ago, Toyota issued a series of recalls on several of their popular models because of safety problems with accelerators, brakes, and power steering. The recalls affected more than 8 million vehicles across five continents. Following the announcement of the recalls, Toyota engineers and mechanics began to search for solutions to the problems and started the process of repairing millions of cars. The company also temporarily suspended production in the United States while it researched the causes of the problems. Many critics accused the company of acting too slowly to recall the defective cars and of trying to push the problem under the rug. Because of the negative press, Toyota sales declined significantly. Toyota president Akio Toyoda admitted, "We so aggressively pursued numbers that we were unable to keep up with training staff to oversee quality." Toyoda also recognized that Toyota was slow to act on reports of problems provided by consumers.
Toyota was fined $16.4 million for allegedly hiding safety defects from consumers. This came after their reputation was already tarnished by a seemingly endless number of recalls on various car models. Toward the end of the various safety recalls related to sudden acceleration, the 2010 Lexus GX460 was declared unsafe to buy by Consumer Reports. Toyota became the target for late-night television jokes and seemed to constantly be in the news regarding yet another recall. This negative publicity damaged the reputation and goodwill that Toyota had developed over many years. In the wake of massive recalls, Toyota had to adjust its advertising strategy. The world's largest automaker pulled its national advertising campaign that promoted its cars for dependability, safety, and reliability. Toyota, which had long been the leader in automotive quality, had to scramble to figure out how to handle a growing public relations crisis resulting from recalls and even a halt in sales.
All experts agreed that Toyota had to move quickly in an attempt to restore trust and deal with a crisis resulting from millions of recalled vehicles. A series of ads were developed to deal directly with the crisis and admit that the company had strayed from keeping its eye on quality while its sales had been growing rapidly. A number of low-key ads dealt directly with the issue and promised to regain consumers' trust. Initially, Toyota tried to tackle the recall problem by addressing individual nations or sales territories. The company thought it could deal with the issue in different ways in different markets. The company forgot that social networking sites quickly highlight product-related problems through global digital media. As the largest auto manufacturer in the world, Toyota faced a global problem and found that it could not control information in different territories. Toyota violated the first rule of crisis management by not responding quickly, but when the company did respond, it took out full-page ads in major newspapers and produced feel-good television spots featuring dealers, mechanics, and owners.
The company offered no-interest loans, discount leases, and a complementary two-year maintenance program to get buyers back. In addition to repairing its vehicles, Toyota had to repair its reputation. Shortly after the recalls, Toyota established a global quality committee and promised to appoint chief quality officers for each of its regions. Toyota is also in the process of designing new safety systems and inspection processes for its vehicles. All future models will include a new brake-override system designed to activate the brakes in the event that both the brake and accelerator pedals are pushed down. Additionally, Toyota will have a third party test its electronic acceleration system. Ultimately, it will take more than committees, promises, and programs to rebuild Toyota. Recently, Toyota has launched an innovative advertising campaign focusing on a new slogan for the Camry. "It's ready. Are you?" is a way to show that Toyota is recovering after the recalls and declined production that tarnished its reputation.
Toyota is not only focused on safety, quality, and durability, but also creating a new image of the Camry as a desirable car that people want to purchase. Two years ago, the flooding in Thailand and earthquakes in Japan resulted in a 54 percent reduction in Toyota's profits. Regardless of these more recent setbacks, Toyota is still challenging consumers to start putting their trust back into the company. By showing readiness through this new advertising campaign, Toyota is hoping to regain consumer trust and market share
Questions for Discussion
1. In what ways is Toyota using promotional efforts to rebuild customer trust?
2. Shortly after the recalls, Toyota cancelled its advertising campaign regarding dependability, safety, and reliability. Was this action necessary? Why or why not?
3. Toyota received a considerable amount of negative publicity during and shortly after the recalls. What could Toyota have done to reduce the amount of negative coverage?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.