Toyota 2009-2010 Recall Case Study
Crisis Communication
Paige Leary
JMA 410 PR Strategies & Case Studies
Duquesne University
Diane Wuycheck
_______________________________________________________3__The_Recall___________________________________________________________4'>Table of Contents
Case Overview_______________________________________________________3
The Recall___________________________________________________________4
Background of Toyota_________________________________________________7
Effects of the Recall___________________________________________________8
Cross- Culture Complications________________________________________9
Communication Methods______________________________________________10
Toyota Advertisment__________________________________________________11
Toyota’s Target Market________________________________________________15
Evaluation of Target Market________________________________________16
Toyota Objectives____________________________________________________17
Taking Action___________________________________________________20
Communication Stategies_____________________________________________22
Evaluations_________________________________________________________ 26
Conclusion__________________________________________________________28
Appendix___________________________________________________________30
References__________________________________________________________32
Case Overview
This study focuses on Toyota’s 2010 vehicle recall and their response to the crisis. Known as one of the most reliable and popular car brands, Toyota faced major scrutiny and negative reactions from the recall. The company recalled over 8.5 million vehicles due to sticky gas pedals and unintended accelerations, which lead to serious accidents and even, resulted in death. Used to having a good reputation, Toyota wasn’t used to this bad reputation and negatively and needed to come up with a plan to deal with the public and restore the brand.
The Japanese company had serious complication while creating the perfect method of communication because of the cultural differences between Japanese and American public relations. As time went on the public started to see the brand as untrustworthy and unsafe because of the quality and lack of information Toyota was releasing to the public.
Finally, Toyota began releasing information about the recalls, apologies and solutions on how they plan on fixing the problem. As the crisis started to relax, Toyota created safety campaigns and advertisements that proved their mission of safety and customer satisfaction. They connected with customers on another level through social media and survey communication and answered questions they had. Toyota had to change their targets with these new campaigns and focus on the big picture how the brand is perceived as a whole. Though their crisis control methods were not flawless, they worked through the problem and have rebuilt their reputation in the past six years.
Through the crisis Toyota used strategies like creating a new slogan, better technology and releasing new vehicles, which helped, resurface the brand and take heat off of the crisis. These strategies are seen still to this day and continue to benefit the company.
The crisis as a whole was learning experience for Toyota because they have never had a serious crisis before. They now have a plan for any future crisis or complication in any type of culture. The managers of the company have become better leaders and understand the importance of cross-cultural communication and are better prepared any issue that may arise. Toyota now is back to focusing on their main mission of safety and customer satisfaction.
The Recall
At the end of 2009, Toyota Motor Corp. was one of the top leaders in the auto industry. However, within a few months, Toyota recalled over 8 million of their vehicles to address the serious issue of “unintended acceleration”, brake problems and “sticky gas pedals”. National attention started focusing on Toyota on September 10, 2009 when a recording of a 911 call of a car crash in California, killing a police officer and his family, was released. The crash was caused by “uncontrollable acceleration” and led to 3.9 million Toyota vehicles to be recalled on September 29, 2009 (Quelch et al, 2010).
In early February 2010, 2.3 million vehicles were recalled for sticking accelerator pedals, which resulted in a suspension of eight models in North America, Europe and China. The third recall was for brake problems on the company bestseller, Toyota Prius Hybrid. The recalls totaled about 8 million vehicles worldwide in 2009-2010, with six million in the United States (Quelch et al, 2010).
The Department of Transportation and the National Highway Transportation Safety Board (NHTSB) increased the investigation on Toyota after the large amount of recalls and conducted hearings in March 2010. This was something Toyota was not used to because Toyota had a positive brand image before the recall and didn’t face a lot of scrutiny at the beginning of the crisis (Jones, 2010). However, the responses from Toyota’s public relations team were considered poor and the public saw Toyota’s responses as insufficient. The public, customers and future customers started to see the company as dishonest and untrustworthy.
Toyota vehicle sales in the U.S. fell 16% in January 2010 and 8.7% in February compared to the previous year. Toyota shares lost 11.6% through February 23, 2010 (Quelch et al, 2010). The Toyota recall crisis was a nationwide news story with media coverage in newspapers, blogs, forums and television news, which presented a massive crisis for the motor company. (Fan, 1988; Fan & Cook, 2003)
Below is a chronological timeline of Toyota recalls from the Guardian Newspaper in 2010.
September 2009: Toyota announces the biggest recall in its history over fears involving almost 4m vehicles in the US that accelerator pedals could become trapped in floormats and "may result in very high vehicle speeds and make it difficult to stop the vehicle, which could cause a crash, serious injury or death".
21 January 2010: Toyota says it will recall around 2.3m vehicles in the US to fix potentially faulty accelerator pedals. The action comes on top of the ongoing recall of some 4.2m vehicles over "pedal entrapment" risks.
26 January 2010: Toyota says it is suspending US sales and halting North American production of eight models involved in accelerator pedal recall, including the country's best-selling Camry.
28 January 2010: Toyota says it will widen the net to include Europe - potentially involving Britain - and China in its recall scheme. US congressional investigators launch probe into accelerator problems. US Congressional investigators request information from Toyota and US safety regulators on the recall ahead of a hearing on 25 February.
29 January 2010: Toyota says recalls in Europe could reach 1.8m vehicles and affects eight models including Yaris and Auris.
1 February 2010: It emerges that Toyota drivers will have to wait at least three weeks before finding out if they own one of the estimated quarter of a million cars in the UK suspected of having "sticking" accelerator pedals.
2 February 2010: Toyota's executive in charge of quality control, Shinichi Sasaki, says the "unprecedented" operation is likely to have a bigger effect on sales than previous recalls and had already hit sales in January.
3 February 2010: Toyota owners in the UK and US are advised by lawyers to stop driving their cars immediately amid growing concern over the potentially lethal accelerator fault. A new defect is reported in Toyota's Prius hybrid model that could result in yet another recall. US authorities say they are investigating 100 complaints, with Prius owners reporting momentary loss of braking ability at low speeds on bumpy roads. Toyota in the UK says it has sent details of the 180,865 affected UK vehicles to the DVLA and is working with the DVLA to identify and contact owners "as quickly as possible". It tells affected drivers that a 30-minute repair will be carried out at Toyota-approved service centers.
4 February 2010: Toyota admits it will suffer $2 billion as a result of the global safety recall affecting millions of cars. The Japanese government urges Toyota to look into 77 reported cases of braking problems among new Prius models sold in Japan.
5 February 2010: It emerges Toyota treated the accelerator fault as a quality issue rather than a safety issue when it first became aware of the problem in the winter of 2008/09. It failed to inform the UK's Vehicle and Operator Services Agency (Vosa), which registers recalls on cars, about the fault until 22 January 2010, after the government demanded information.
Toyota's president, Akio Toyoda, finally emerges to apologize for the sticky accelerator problem. "We are in the midst of a big crisis and face big challenges ahead," Toyoda says.
9 February 2010: Toyota confirms a global recall of all third-generation Prius cars manufactured before 27 January 2010. It affects 8,500 cars in the UK, where the latest Prius model went on sale last August.
"This recall will consist of a software upgrade in the anti-lock braking system. In the meantime, the cars are safe to drive. At no time are drivers without brakes," ToyotaGB insists.
17 February: Toyota announces it will install a brake-override system in all future models worldwide. It is considering a recall of the Corolla because of possible power steering problems. The US government demands that Toyota hand over documents to show whether it acted promptly with the safety issues in its cars.
19 February: Akio Toyoda bows to US pressure and agrees to appear before a congressional hearing into the crisis. The company also confirms it will confirmed it would suspend production at its plant in Burnaston, Derbyshire, for two weeks.
22 February: Leaked emails show that Toyota staff boasted about how they had saved the company $100m by persuading American regulators that they did not need to implement a full recall over problems with its floor mats.
23 February: Toyota faces the prospect of criminal charges after a US grand jury issues a subpoena, demanding more evidence relating to the recalls. And a man jailed after crashing his Toyota, killing three people, demands a retrial - and relatives of the victims say they support him (The Guardian, 2010).
Background of Toyota
Toyota is a Japanese automotive manufacturer, founded in 1937 by Kiichiro Toyoda, headquartered in Toyota, Aichi, Japan. It is the 13th largest company in the world by revenue and is made up of over 330,000 employees worldwide (America’s Best Employers). The companies mission statement is "To attract and attain customers with high-valued products and services and the most satisfying ownership experience in America"(Toyota Mission). They are ranked #257 as the best employer and as the Worlds 8th most Valuable Brands as of May 2015 (America’s Best Employers).
Share with your friends: |