Can Toyota survive?


One business story that seems to be a permanent feature in the news headlines around the world is the crisis confronting Toyota and the car maker’s product recalls.

The assault on Toyota’s reputation is undoubtedly a matter of grave concern to the company’s leadership, although some critical analysis of how Toyota is dealing with this suggests deep-seated Japanese business/cultural behaviours and traditions may not be helping Toyota at a time where transparency and nimble actions, among other things, on a global basis are needed.

Indeed, one current talking point is whether or not the company – the world’s largest car maker – can actually survive this global crisis, intact.

Of the many media and other reports I’ve been reading today, this analysis in yesterday’s Telegraph Motoring in the UK summarizes the picture for Toyota pretty well:

How is Toyota reassuring current and future customers that its products can be trusted?

The company’s US arm has decided to get its message across via a series of expensive television advertisements. But at the start of this week Toyota GB was refusing offers by at least one television station to appear on screen.

Could sales of new and used Toyotas be affected?

Yes. Glass’s, the motor-trade prices bible, admits motorists will now be "wary" of the brand. The price of a new Prius is set to drop by up to £2,000. Buyer caution could make Toyotas old and new more difficult to sell.

How badly is Toyota being damaged and can it recover?

The brand is being damaged, not because of the recall, but because of the way the company has handled it. It’s the car world’s biggest consumer debacle for a decade.

Brand Finance, a global brand consultancy, named Toyota the most valuable car brand until recently with a value of $27bn (£17.2bn) and a triple A rating.

It now values Toyota at $24bn with a single A rating and says: "A drop to $20bn or below is quite possible if the crisis is not brought under control… Terminal damage could be inflicted."

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Neville Hobson

Social Strategist, Communicator, Writer, and Podcaster with a curiosity for tech and how people use it. Believer in an Internet for everyone. Early adopter (and leaver) and experimenter with social media. Occasional test pilot of shiny new objects. Avid tea drinker.

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