Can Toyota bounce back to their pre-incident market levels?

With the widespread coverage of Toyota’s recalls in the past year, and negative consumer response, industry experts wonder whether Toyota will be able to regain its market shares to pre-incident levels. We turned to our panel of automotive experts and here’s what they had to say:

Santiago Salmones, a consultant with over 20 years of experience in the automotive industry, says that the quality management blunders made in the corporate ranks and as well as in manufacturing are neither new nor more serious than others that have occurred in other automotive brands. Salmones points out that these problems “become noticeable and spread faster” due to globalization. Referencing serious flaws like the sudden acceleration in the Pontiac Sunfire, ineffective brakes in the Dodge Stratus, and GM’s defective Easytronic transmission, it is clear that manufacturing failures are nothing new to the automotive industry. Although Toyota’s flaws are serious, they have likely been “overstated by the media and U.S. authorities in a sort of convenient self-victimization that characterizes American culture.”

Cbeltran, a professional with extensive knowledge of the global value supply chain of the automotive industry, was surprised by how poorly Toyota handled the situation by delaying decisive actions. Ultimately, this backfired on Toyota by “opening a door to the media and the U.S. Government for pointing fingers out of proportion.” However, the Toyota brand has proven its resilience faster than anyone thought possible. By utilizing an effective post-incident positioning strategy, Toyota has communicated that, “there is much more of Toyota beyond the safety issues.” Still, Toyota will not be able to return to their pre-incident market levels after losing its “halo” of quality, durability, and reliability. Toyota’s competitors, like Ford and Hyundai, have taken over the spot for top quality and have “more echo in the marketplace.” Toyota does have its share of loyal customers as well as new, informed customers who will still consider buying their vehicles, but most will not perceive Toyota anymore as a top safety pick. Cbeltran explains that Toyota’s advertising shows that they acknowledge this, which is why they are positioning themselves as a social-driven company instead of relying exclusively on quality attributes.

Paul Stockwell, a UK based expert on vehicle electronics and vehicle security, states that Toyota’s future will depend “upon the PR job Toyota does and whether there are any repeats of the stuck throttle incidents.” Many people find it difficult to imagine that Toyota suddenly started using badly designed throttles or wrongly cut carpet. More likely, people believe that many of Toyota’s workers in engineering, procurement, test and quality control failed to do their jobs. Stockwell understands that once a brand gains a reputation for poor products, “it is notoriously hard to shake” this negative perception. Toyota will not only have to launch a new range of products but it will also have to come up with an array of new model names to finally “put this one to bed.” However, Strockwell knows that it is difficult to validate the safety of software and there is no 100% reliable method. With new environmental issues, safety and economy requirements and customer expectations “driving the development of increasingly software dependent vehicles,” it is likely that Toyota will not be the last automobile brand to suffer problems.

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