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Toyota Recalls More Cars as Safety Woes Continue

Toyota will recall 437,000 Prius and other hybrid vehicle models, bringing its worldwide recall total to 8.5 million vehicles for brake and accelerator problems.

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    Toyota's latest recall involves 437,000 cars worldwide, including almost 150,000 in the U.S. The world's largest automaker acknowledged a software glitch could lead to braking trouble in bad driving conditions. Most of the affected models were Toyota's 2010 gas-electric hybrids, including its marquee Prius. The Lexus HS250h sedan was also on the list.

    One Prius driver in Dallas said he had complained about the brake issue since August, when he nearly ran over a pedestrian.

    JUAN ROMERO, Prius driver: When the car lurched forward, the guy jumped out of the way, and he called me every name in the book.


    Toyota had already recalled nearly eight million of its vehicles. Most of those were flagged for a sudden acceleration problem that the company linked to faulty gas pedals and floor mats. Akio Toyoda apologized last week for his namesake firm's quality-control problems. Today, he pledged again to right Toyota's wrongs.

    AKIO TOYODA, president & CEO, Toyota: All of us at Toyota, we tackle the issue in close cooperation with dealers and with the suppliers. Together, we will do everything in our power to regain the confidence of our customers.


    As part of the effort to rebuild trust, Toyota penned an opinion piece for today's Washington Post.


    In recent days, our company hasn't been living up to the standards that you have come to expect from us.


    And the company has also begun airing this television ad in an effort to own up and move forward.


    We're working around the clock to ensure we build vehicles of the highest quality to restore your faith in our company.


    At the same time, State Farm Insurance said today it reported concerns about acceleration problems in Toyotas in 2007 to the National Highway Traffic Safety Administration, or NHTSA.

    But a Democratic congressional staff memo said neither Toyota nor federal regulators have identified all of the causes of the uncontrolled accelerations. On top of that, newswires reported late today Toyota will recall 7,300 of its top-selling Camry sedans, 2010 models. They could have a steering problem.


    And here to discuss these latest problems for Toyota are two people who cover the company and the auto industry, Ken Bensinger of The Los Angeles Times and David Welch of Bloomberg BusinessWeek.

    Toyota declined our request for an interview.

    Ken Bensinger, David Welch, thank you both.

    And, Ken Bensinger, to you first.

    Of all the Toyota models now, how many are involved in some sort of recall or investigation?

  • KEN BENSINGER, The Los Angeles Times:

    I don't want to get the number wrong, because it seems to grow every single day, but I believe it's — it's well over a dozen, and it's approaching about 15 different models that are involved in one or more recalls.

    It's important to note there's some overlap there. Some — some vehicles are actually in two recalls. And some vehicles you can't even buy in the U.S. are now being recalled, in Japan, for example.


    And tell us what's behind this — this latest Prius recall. What's the problem?


    Apparently, there's a problem with the braking system in this. It's computer-controlled system that has to do with the — the high-tech brakes that a hybrid has and — and their antilock braking system.

    And Toyota is saying there's a software glitch that they can fix. What's interesting about it is that Toyota also said they already knew about the fix and had it implemented on the assembly line some time ago, which raises questions about how long they knew about this problem.


    And, David Welch, in reading, these are the regenerative brakes. Explain what those are.

  • DAVID WELCH, Bloomberg BusinessWeek:

    Well, in hybrids, when a car brakes and slows down, the car actually will actually recharge the batteries off of friction from the regenerative brakes. It sends electricity back to the battery, so you can keep driving with some electric push and use less gasoline.


    And — and Toyota now has — has — we have been hearing about this for a week. Do we know why it was not until today that they formally announced the recall?


    Well, it's a good question, because this was actually first flagged in Japan. There were a number of complaints about the Prius over there, and Japanese regulators started pushing for a recall.

    And then we actually had — it started with about 17 or 19 complaints, Japan. And the day that came out, I checked myself on the Web site for NHTSA, and there were well over 100 complaints in the U.S. about the Prius brakes, and even more that had to do with the cruise control system. So, these complaints were piling up. And there was no recall or service bulletin or anything put out until some days after.


    And — and, Ken Bensinger, are there other Toyota hybrids involved here and other — other models of cars involved that are hybrids?


    Well, in this current — in the new recall, yes, there's a — there's a Lexus, their brand-new hybrid, which is called the HS, just came out this year — or excuse me — last — late last year. And that seems to use similar technology for braking and is part of the recall in — in Europe, the U.S., and Japan.

    And there's a model called the Sai — S-A-I — which you can only get in Japan, apparently has the same problem. Separately, there's this Camry issue, which is braking, but not apparently software related. And it seems to be a braking line leak that can lead to loss of hydraulic pressure and braking problems.

    But, all told, we're talking nearly 500,000 more vehicles added to the list. And what's interesting is, this is a problem that's distinct from the one we have seen elsewhere, which is unintended acceleration. And now it seems to be extending beyond that. So, perhaps we want to wonder, is — is this related or not? Is this some kind of holistic problem that affects all these vehicles, or are these truly discrete problems?


    And, David Welch, there's also now this information about the Corolla, another Toyota model, with an electric power steering issue.


    Yes, these recalls just keep piling up. And what Greg (sic) was just saying, there are different parts of the car, so they have got to be unrelated. I mean, first, it was floor mats. Then you have accelerator pedal. Then you're talking about regenerative brakes, and then you're talking about steering.

    You know, it looks to me like they have just taken their eye off the ball with quality control or — really, with Toyota, the company grew so fast over the past decade. And they were building plants, adding workers all over the globe, and adding a lot of new model lines that they didn't have.

    And I think it's fairly safe to say — and, in fact, I have written this — that they may have overstretched their resources and just really couldn't keep up with the growth they were having and the same levels of quality that had built the company's brand over the past several decades.


    And, meantime, we know — I will stay with you, David Welch on this — these new — the new information coming out about State Farm Insurance, saying they notified — in 2007, they notified the National Highway Traffic Safety Administration that there were problems. What's the story there?


    Well, this could be trouble for both NHTSA and Toyota, because you have got a congressional inquiry on this looking into, one, whether Toyota dragged its feet, and, two, whether NHTSA just failed to identify problems.

    And if the insurance company is saying it goes back to 2007, and there wasn't a recall until early this year, and they didn't even really start looking into it until late 2009, then you can say, you know, possibly that both companies — or both the company and the government dragged their feet on this thing. And, you know, there's going to be some — some trouble for both, I think.


    There was to be, I guess, a congressional hearing today, Ken Bensinger, and they called it off because of the snowstorm coming.

    But, Ken Bensinger, you were telling us there are — there are staffing and budget issues at NHTSA.


    Yes, I would like to sort of expand off what David said.

    The State Farm thing is troubling, but, in fact, a lot of the work we have been doing here at The Times shows that this has been an issue that Toyota has known about and that NHTSA has known about, NHTSA being the Highway Traffic Safety Administration, for quite a bit longer than 2007.

    In fact, NHTSA investigated acceleration problems in Toyota dating back to 2003. And, since then, they have done eight investigations, and the only thing they have led to was a tiny recall on some Sienna minivans and a prior floor mat recall.

    Now Congress, which is going to continue to take — look at this issue in a couple weeks, Congress is asking serious questions about whether NHTSA was asleep at the switch on this issue, and why is it they were unable to notice a problem, when there was really abundant evidence that something serious was going on. Why couldn't they spot a problem that suddenly Toyota says is evident and obvious?


    And I think this is something we want to — we want to continue to look at, because you were telling us NHTSA has a very small staff, compared to the number of complaints that they get.

    But I want to quickly ask you both — and I will stay with you, Ken Bensinger. Toyota today is launching — or has been now launching this advertising campaign. What is the message that they're trying to get out? What are they doing?


    Well, Toyota is a company built entirely on — on trust and the idea that they make high-quality cars that don't fail and that are safe.

    And that's the value proposition they have been giving people. All of a sudden, for them to come out with a series of sequential recalls, in a way that makes people feel uneasy about how many more problems there are, Toyota has some serious work to do to reestablish that — that position.

    And they — they really have to, because we're talking about their latest, most modern vehicles affected in these recalls. So, they don't have other products to sell people. This is just about everything they have got. And they have got to convince people to come back to buy these vehicles, or they're sunk.

    So, the message is: Trust us. Believe in us. We're there for you, and we're going to give you service. And, you know, that's a tough — that's a tough bill of sale right now, considering all the challenges and the future stuff they're going to face.


    David Welch, is there anything you would compare what Toyota is going — anything else that has happened in the automotive industry in the past with what Toyota is going through right now?


    You know, in some ways, this is fairly similar to what Ford and Firestone went through in 2000 and 2001.

    You will recall, back then, Ford Explorers that were riding on Firestone tires were rolling over. The tires were failing, but, also, it turned out later that the Explorer itself wasn't all that stable. And it took both companies a long time to recover from that, in terms of their brand strength and getting people to trust them again.

    And Toyota has a real problem with this, because, you know, like we just heard on this show, you know, they have built the brand on quality and on trust. They were the one big company that — that everyone thought they could really rely on. And, if that is shaken, they're in trouble, because, you know, let's face it. Toyota has made very good cars for a long time. But you don't buy them because they're cute or because they have white-knuckle performance.

    You buy Mustangs and Camaros for that sort of thing. You buy Toyotas because they're the safe, smart purchase. And when consumers stop believing that, they will start to look at other companies on a more even playing field, and Toyota is going to have to compete harder for those buyers.


    We're going to leave it there.

    David Welch with Bloomberg BusinessWeek, Ken Bensinger with The L.A. Times, gentlemen, thank you both.


    Thank you very much.


    Thank you.

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