Tough Times for Toyota
While you were all pigging out over Christmas, Toyota has been taking it in the teeth, particularly from the L.A. Times in a scathing piece. The world’s largest carmaker is accused of covering up vehicle defects with impunity for years. It’s not just the floormat issue and recall, which everyone in the world now knows about. Major safety cover-ups are charged, including: sudden acceleration in various vehicles for nearly ten years, payoffs to owners of such vehicles, steering defects, and accusations of hiding evidence from courts, lawyers, and the NHTSA.
The Times’ lengthy indictment documents numerous specific instances, among them several where owners of sudden-acceleration cars refused to drive them again and returned them to dealers. The cars were bought back under the lemon law—but then resold to other people!
A big part of the scandal covers the cars’ electronic black boxes, or electronic data recorders (EDRs), whose data can be read by only one (1) device in the U.S. The Times put several questions regarding this situation to the company. Their responses are here. The company has of course denied any allegations of a cover-up, but the NHTSA says, “The matter is not closed.”
Toyota is also getting a blast from none other than Hugo Chavez, boss of Venezuela, who recently ranted about not getting enough 4x4s for public transport and use in poor, hard-to-access rural areas. The righteous ruler was angry and said if the company didn’t choose to make these particular cars, then
We must force them. And if they don’t, then they should leave and we’ll bring another company in…. The Chinese want to come and they make ‘rustic’ models.
The boss then told his trade minister,
You tell the people at Toyota that they have to produce this model and we are going to impose a quota, and if they don’t meet it, we will punish them.
Meaning, expropriate the Toyota manufacturing plant, as the government has done with other industries. The company’s spokesman hastened to say it was all a misunderstanding, that they had quit making the Land Cruiser 70 in 2007 and had duly informed the government about it. Venezuela has been hit hard by the recession, especially in the automotive area, where sales are down 40 percent from November of last year.
And finally, Toyota is requesting the U.S. International Trade Commission to dismiss yet another suit by Paice LLC for patent infringement. The latter company already won one contest, declaring that Toyota stole its ideas for the “Hybrid Synergy Drive” powertrain as used in the Prius. Toyota says they are paying a royalty to Paice for every hybrid sold, and enough is enough.
My goodness, we don’t want to see the company spend all its profits (what little there are these days) on legal fees. Let them keep building and developing great cars—like the FT-86 tgriffith just reported on. But when big companies get too fat and complacent, they sometimes get, well, high-handed. If the Times’ stories are true, we probably haven’t heard the last of their troubles.
Let us have your opinion of Hugo Chavez’ possible expropriation of Toyota auto factories in Venezuela.