A firm’s reputation is built over many years. That reputation, however, can be undermined almost immediately by an unexpected turn of events. How management deals with a crisis underpins the maintenance of a corporate image. In the case of Toyota, the world’s biggest carmaker, the latest alarm follows worldwide recalls of almost eight million cars. The problem is two-fold — the first technical, the second managerial. Toyota models have suffered from two distinct but related problems with the accelerator. Initially, the problem seemed to centre on faulty floor mats that caused the accelerator to jam. But in fact the problem extends to the malfunctioning accelerator pedal itself. Toyota, having clung to the first explanation, has now issued a second recall of 4.3 million cars worldwide due to floor mat and pedal problems. Toyota’s managing officer, Hiroyuki Yokoyama, said although the company had found a clash between the anti-lock brake system (ABS) and regenerative braking, more investigation needed to be done before deciding on whether to issue a recall on the Prius.
Building an empire is painstaking; ruining it is easy. It took 70 years of imagination, graft and ambition to make Toyota the largest car manufacturer in the world. But that astonishing achievement may be quickly undone if Toyota continues to react so contrarily and clumsily to safety concerns about several of its models. A brand based on reliability is proving to be unreliable at both a practical and corporate level. The latest crisis affects the symbol of the automaker’s engineering prowess. Angry customers are also demanding to know why recall notices have only just been issued when Toyota has known of the accelerator defect since last winter.
