Toyota was right. But who cares?

Remember the news media frenzy last year over the “unintended sudden acceleration” of Toyota vehicles? You could hardly have missed it.  But did you manage to catch the fleeting new report that it wasn’t a vehicle fault after all?

Yes, it’s true. A ten month investigation by The National Highway Traffic Safety Administration (NHTSA), with help from NASA, recently cleared Toyota by announcing that the company’s electronic throttle system was not to blame for reported episodes of runaway acceleration, as alleged by safety advocates and some members of Congress.

The Federal safety agency looked at the “black boxes” in dozens of Toyotas and Lexuses whose drivers blamed their crash on unresponsive brakes and runaway acceleration, and found that in nearly all cases the accelerator was at full throttle and the brakes weren’t engaged. NHTSA coyly referred to the problem as “pedal misapplication” – in other words the drivers pressed the accelerator and not the brake.

This outcome mirrored work by Toyota’s own engineers on over 2,000 cars, which similarly found human error in most cases. Meanwhile Toyota had recalled millions of cars at a cost of billions of dollars, paid nearly $50 million in fines and saw a massive fall in its share price.

So what is the lesson for issue and crisis managers? Sadly, one important lesson is that being right – and proven right long after the event – is little defence against a high profile allegation of wrongdoing. Such reputational damage applies not only to corporations, but also individuals, as amply shown by many politicians, celebrities and sports stars “tried and found guilty” by the media.

And of course the Toyota allegations came after the notorious Audi “sudden acceleration” scandal of the mid 1980s’ which devastated the company’s sales and reputation.  Here too human error was found to be the main cause, and many years later the woman whose story triggered the AUDI allegations admitted she had pressed the accelerator instead of the brake. 
 
Many crisis experts at the time faulted Audi for blaming drivers and consequently suffering added damage, despite the fact that Audi was eventually totally vindicated. This time around, Toyota tried to avoid openly blaming drivers, and suffered damage anyway, though their recovery has been much quicker than the prolonged decline in the USA suffered by Audi. However Toyota’s reputation suffered another blow last week, soon after the NHTSA announcement, when they advertised yet another recall to deal with insecure floor mats.

It is a tragic fact of issue and crisis management that the truth delayed has minimal impact compared with the initial allegation.  Perhaps it’s just a coincidence that in the same week Toyota was “vindicated”, the Iraqi émigré largely responsible for spreading reports of weapons of mass destruction in Iraq finally admitted it was a complete lie to help topple Saddam Hussein. If you blinked, you probably didn’t see that “correction” either.

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About managingoutcomes

Issue and crisis management expert
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3 Responses to Toyota was right. But who cares?

  1. Pingback: Toyota recall aftermath: many protagonists fail inspection | James J. Donnelly.com

  2. J.D. says:

    Good post, Tony. I’ve added a link to your story on my related post…where I further explore the implications of “determined protagonists” on a crisis situation. The post is here: http://www.jamesjdonnelly.com/2011/02/toyota-recall-aftermath-many-protagonists-fail-inspection/

    Regards,
    J.D.

  3. Tim Ogden says:

    Tony,

    I appreciate your take on this. I wanted to point you to our new book, Toyota Under Fire, which tells the inside story of how the “crisis” was manufactured, but far more importantly, how Toyota responded. We look at both the missteps and how we believe Toyota ultimately used the crisis to drive some needed corrections and improvements in the company.

    You can find it here: http://www.amazon.com/Toyota-Under-Fire-Lessons-Opportunity/dp/007176299X/ref=sr_1_1?ie=UTF8&s=books&qid=1301418997&sr=8-1

    Best,

    Tim

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