For years Toyota has been the darling of capitalism. The "Lean Manufacturing" philosophy and "Toyota Way" became the model to emulate for manufacturing corporations around the globe. As people are quick to stand behind a winner, they tend to be even quicker to dissociate themselves if and when they fall from grace a la Tiger Woods.
To be fair to Toyota, the latest estimate is that their vehicles were responsible for 19 deaths in the past decade.[1] While that's 19 deaths too many, it pales in comparison to over 420,000 motor vehicle related deaths that occurred in the United States alone over the same decade.[2] It will take months to determine if Toyota executives acted with negligence or were slow to respond to the reports of problems; but given the statistics, even if Toyota admits 'mea maxima culpa', driving a Toyota remains safer than driving any given vehicle while texting, programing a GPS, speeding, or under the influence of alcohol among other driving hazards. It just happens that a large, financially successful corporation can be held accountable for those nineteen, while most of the 419,981 others lack such a powerful scapegoat.
That's not to acquit Toyota--especially if they knew about the design flaws and opted not to correct them for economic reasons. Ford allegedly did this with the Pinto in the early seventies. According to sources, the company knew about a design flaw that could cause a gas tank explosion in the event of a rear-end collision but determined that the ensuing lawsuits could be settled for less than the cost of fixing the design (since it was already well into production)[3].
While the Pinto put a large gash in Ford's reputation, it has obviously recovered and is now all but forgotten. Given the scope of Toyota's recent recalls, this could have a much bigger impact on the company's reputation and future sales than the Pinto miscalculation did on Ford.
Some analysts have gone so far as to predict bankruptcy for the auto giant. This possibility may actually not be too far fetched given the debunking of the "too big to fail" myth in the past couple years. This, in addition to the fact that Toyota is still expecting a loss for the 2010 fiscal year (ending March 31) even before the impact of the recent recalls[4]. Even so, it's also in the best interest of many economies, including the United States and Canada, to continue to support Toyota since the company produces so many local jobs.
At the end of the day, I wouldn’t feel too concerned about the statistics of driving a Toyota; but I do think it’s time for business to recall the cliche of the Toyota Way. Many of the principles will remain of course, but their association with Toyota will irreversibly fade. Now there may be a new business model for business to emulate: The Google Way.
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