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Toyota's Troubles

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Full Article: http://www.thestar.com/Business/article/182948

Toyota's troubles

Despite being set to replace GM as No. 1 automaker, Toyota's breakneck growth has hobbled it with high recall rates, severe skills shortages, slowing efficiency and Third World competition

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Toyota Motor Corp.'s list of growing pains just got longer. With its fabled attention to detail, Toyota Motor Corp. recruited two of America's most respected stock-car drivers for its debut in NASCAR last weekend. As the first non-U.S. competitor in America's most popular sport – commanding a fan base of about 90 million people – Toyota is hoping to project itself as a U.S. company that employs thousands of Americans at its seven U.S. plants, and to counter a potential backlash as it gains market share at the expense of Detroit automakers.

Toyota could hardly have done better, one would have thought, than in its selection of veteran NASCAR fan favourites Dale Jarrett and Michael Waltrip, drivers known for their integrity and sportsmanship. But last Thursday, two-time Daytona 500 winner Waltrip was caught trying to super-charge his Toyota Camry with a suspected jet-fuel additive ahead of last weekend's Nextel Cup Series in Dayton Beach, Fla.

NASCAR decided to let Waltrip compete in the race using a backup car. But it impounded his doctored Camry, docked him points, and banished his crew chief and manager from the contest. A Toyota official called it "Toyota's worst nightmare."

As its manufacturing network has grown to 45 plants worldwide, and its managerial cadre stretched thin, Toyota now finds its vaunted efficiency gains are more difficult to achieve. In the late 1990s, Toyota was dazzling competitors with its ability to build a car in just 21.6 hours – more than 10 hours faster than GM. A decade later, Toyota's performance had barely improved, to 21.3 hours, while GM had almost caught up.

Contrary to public perception, Toyota is not a low-wage producer. A confidential company strategic plan that surfaced earlier this month warned that Toyota's heady growth – and accompanying hiring frenzy – is pushing up labour costs in North America faster than profit margins. "This condition is not sustainable in the long term," said the document, which Toyota acknowledges is authentic, and which calls on Toyota to curb a forecast $900 million (U.S.) increase in labour costs by 2011 by paying the going rate in each U.S. state in which it has a plant, and no longer tie its pay and benefits to the North American industry average.

In its pursuit of efficiency, Toyota has long been an industry leader in using common parts across a wide range of models. The downside is that when a component turns out to be faulty, the resulting recall can be massive. For instance, the two suspect engines in the oil-sludge case – which auto mechanics complain were designed with oil passages that are too narrow – affects the Camry, Solara, Sienna, Avalon, Celica, Highlander, Lexus ES and Lexus RX models. This one settlement could end up covering 3.5 million vehicles.

CEO Katsuaki Watanabe, 64, describes the quality issue as "an emergency." He admitted to reporters: "We have received critical inquires from customers who are concerned whether our vehicles are safe. The world-class quality that we've built is our lifeline. Without improvements in quality, Toyota cannot grow."

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There, there Toronto Star, as painful as that article may have been to write, at least it was buried in the business section where nobody but BMW drivers will read it.

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If there is any fairness left in this world, this list will grow daily until people are no longer blind.

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look at the top 10 topics on this Asian thread.

faulty odometers

toyota cheats

convicted exec gets promoted

toyota figuring out how to gash labor costs

chinese 'crash safety'

toyota sludge

recalls aplenty

and the ASIANS DO NO WRONG? they just simply have NEVER had to endure scrutiny in this country. And we want these 'better companies' taking over our American auto industry?

its time for the free pass to be over and at least we get some equal time.

Edited by regfootball

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