Economy & Budget

Is the Obama Agenda to Blame for the Toyota Recall Media Boom?

“At Milton Martin Toyota, our customers and their safety is our top priority, and we’ll fix your car, whether you bought it from us or not.” Jimmy Hernandez, Milton Martin Toyota, Georgia
Is there less to the Toyota recall then meets the eye? Is there an Obama agenda to boost the car manufactures it owns — Chrysler and GM — at Toyota’s expense?

There are about 1400 Toyota, Lexus and Scion dealerships in the United States. When you keep in mind the Toyota factories and part stores etc. Toyota is a big employer. That’s “jobs created and saved” by small business in many communities throughout the nation.

Doing a simple search on www.recalls.gov – a site paid for with your tax dollars — it becomes apparent that automobile recalls are not unusual. In fact every month for the last 6 months, at least three types of vehicles have been recalled. If you factor in motorcycles and motor homes, it becomes apparent recalls are common place. Honda, Daimler, Volvo, BMW, Jaguar, Hyundai, Mack and Nissan all had recalls in the last six months of vehicles over several model years yet I couldn’t find any news articles on any of these recalls. Should Congress really be demanding a perp walk by Toyota executives?

Perhaps it was the fatalities linked to the recall of Toyota brands, that differentiated them. In retrospect, automobile insurance carriers like State Farm reported as early as 2007, they had noticed an uptick in the kinds of problems caused by a sticking accelerator pedal. And of course, a kind of “post-Toyota stress syndrome” is settling in across America where owners who didn’t have problems with their Toyotas, think they did.

Across the country dealers are doing what they do, meeting the customer’s needs. Most dealers I talked to did not want to go on the record to talk about this, they are very sensitive about how the recall is portrayed in the press. Jimmy Hernandez at Milton Martin Toyota in Georgia said, “We have not seen any of these problems before the recall or had any record of people coming in describing these problems before the recall.” Dealers want to solve problems. It is not just about the sale of the vehicle. They build a relationship with the customer because they are connected to the community through membership in civic groups, charitable organizations and support for all manner of teams from Little League to The American Cancer Society’s Relay for Life. They are invested in the community.

Very few businesses have taken the hit that automobile related businesses have in this recession. But they are taking this in stride and at Milton Martin Toyota as well as every other Toyota dealer in the country, they are listening to their customers.

Toyota plans to end production in March 2010 at the Fremont plant it has run with General Motors. The Toyota-GM partnership ran the plant since 1984. This plant has the highest union costs of all the U. S. Toyota plants and Toyota sited the cost of operation and a reduction in cars produced worldwide as the reasons for closure.

In late January, the headlines read, “GM, UAW Capitalize on Toyota Recall.” GM and the UAW are partners with the Government in competing with Toyota after the bailout. Maybe the headline should read, “Obama and the UAW Capitalize on the Toyota Recall.”

The AP has reports the U. S. Department of Transportation wants documents related to Toyota’s massive recalls in the United States to determine if the automaker acted swiftly enough. Toyota is closing temporarily two plants over concerns the recalls could lead to big stockpiles of unsold vehicles. Former National Highway Traffic Safety Administration (NHTSA) director Maj. General Jerry Curry said, “By law when a motor vehicle manufacturer discovers that it has discovered a safety defect, it must notify NHTSA that such a defect exists within five working days. By the time NHTSA is notified it has usually already discovered that the safety problem exists from customer complaints to its ‘Hotline,’ or through police crash reports or accident fatality reports. What is clear about the Toyota safety problem is that what should have been handled as a routine motor vehicle safety recall has now become a political football, and is well on its way to souring the good relations between the United States and Japan.”

So the government is asking for an expansive release of records from Toyota when the U. S. Government and the UAW are primary stakeholders in Toyota’s primary competition (GM and Chrysler). How does the Government investigate a company which it essentially competes against? That is the question in the anti-free market Age of Obama. It will be circus and it will be bad for the economy. Investigate the problem but don’t make it a crime.

For me, it comes down to the local dealer. How will they survive? They will do it as they always have by providing great service. Dealers, like Milton Martin Toyota, who have managed their business well and have the resources to weather the storm, will stay in business. However, many dealerships, Toyota and others won’t make it through another blow to the auto industry.

One benefit of the DC Blizzard of ’10 is the hearings into this matter were postponed for at least two weeks. In the interim, 50,000 Toyotas a day are being inspected and serviced in dealerships across America. The customer is being served and the executives from Toyota will have a firmer grip on the extent of the problem and will be able to report to Congress how the problem is being solved.

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