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Sunday, Feb. 21, 2010
Consumer safety should come before pride
With Toyota's reputation for quality on the line, Japan and the United States look at car recall differently
It's difficult to get a balanced perspective on the public-relations crisis surrounding Toyota Motor Corporation's current global recall, which mostly involves its popular Prius hybrid.
When you're the world's No. 1 carmaker it's natural to expect a backlash when something goes wrong. What makes the situation different is that there are two fronts to the PR war, one in Japan, where the company is headquartered, and one in the United States, its most important overseas market.
The conflict is being characterized as one between American authorities and Toyota's management, but since Toyota has acquiesced to the U.S. government's demands for answers regarding the recalls, albeit not as promptly as some people would like, the real conflict is between the American media and the Japanese media, even if they never actually face each other.
What's at stake is Toyota's storied reputation for quality. In an article that appeared in the New York Times, writer David Segal described Toyota, using a metaphor that sounded very Japanese, as the straight-A student who suddenly got an F.
If the resulting schadenfreude was more intense, it's because Japanese carmakers retain some vestige of blame for the demise of America's automobile industry, even if most Americans also understand that it was the industry's own fault for not consistently meeting the challenge of Japanese cars.
The Japanese media tend to overlook how much Toyota and Japanese cars in general have become part of American society. The press still acts as if it's the 1980s, when "Japan-bashing" was centered on cars. Japanese companies have learned a lot since then, and for the past 20 years Toyota has invested billions of dollars in its American operations, which are locally based. Governors of four states where Toyota operates factories have sent letters to the U.S. Congress defending the automaker. Toyota dealerships in America employ 172,000 people. Damage to the company's reputation places these jobs in jeopardy: Toyota car sales dropped by 20 percent in January due to the recalls.
The Japanese media primarily see this backlash as being culturally motivated. The American government now effectively owns General Motors, and thus has a stake in its revitalization. Certain publications infer even more nefarious purposes. Shukan Port claims that the U.S. is getting back at Japan for dragging its feet about moving the Futenma air base.
The issue's real cultural component is more complex. In the U.S., the concept of consumer protection is deep and wide, going beyond federal regulations to include independent watchdogs like Consumer Reports, strict truth-in- advertising laws, and the media in general. Together these elements make for a climate where problems, whether perceived or genuine, tend to be magnified. Since the recalls started four months ago, the number of complaints related to Toyota vehicles in the U.S. has "skyrocketed," according to an Associated Press report. The complaints have yet to be verified, but the volume demonstrates how hyperaware American consumers tend to be and how willing the media is to cover their concerns.
Automobile recalls are common, even in Japan. A month doesn't go by when some model isn't being recalled, and that shouldn't be surprising. Cars are not like other products. If your HDD recorder goes on the blink, it means you might miss an episode of "SMAP x SMAP," but if something goes wrong with your car it could end up wrapped around a utility pole — with you inside.
But in Japan recalls are carried out in a low-key manner, normally publicized with very brief articles in the back of the daily newspapers. Unlike in the U.S., television as a rule doesn't report recalls, ostensibly because they are considered business transactions between manufacturers and consumers, but mainly because automobile makers are major advertisers.
Even the current Toyota recalls were handled gingerly. Because Americans had made it news the Japanese press was required to cover it, and for a week local TV news shows dutifully described the safety problems that led to the recalls, what owners of the affected cars could do, and how Toyota was handling it.
The recalls were usually described as being no more serious than past recalls that didn't receive media coverage. What is different this time is that Toyota was thought to have willfully covered up the problems, which is worse than making a design or production mistake since it implies dishonesty. That's why Toyota President Akio Toyoda, the grandson of the company's founder, was requested to appear before the U.S. congress and explain the carmaker's actions. To the Japanese media, it was like asking the Crown Prince to come to Washington and explain the Futenma situation. Toyota's reputation overseas, as well as that of other Japanese carmakers, is a matter of pride for Japan, which is probably why the media never report on Korean carmaker Hyundai's comparable success in the U.S. and Europe.
Pride, of course, goes before the fall, and the whole matter of avoiding unpleasant truths for the sake of saving face has its price, and in this case the price is compromised safety. And in the long run facing those problems is better for business. Because of the U.S.'s more transparent consumer-protection culture, the word "recall" is less loaded there than it is in Japan. In the U.S., models subjected to recalls tend to have higher resale value since it's assumed they've been checked thoroughly and are thus safer.
The situation is different here. When I was shopping for a car in the mid-1990s I asked a Toyota dealer which models had protective side-beams and he almost laughed at me. Last week, Ichiro Furutachi, the anchor of TV Asahi's news show "Hodo Station," seemed genuinely shocked when he learned that brake override systems are not standard on all Toyota vehicles. Sometimes, the media is the last to know.