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Seems a flurry of safety recalls of cars known for reliability are not Toyota’s biggest problem. What is? Not building enough auto manufacturing plants in the U.S. and elsewhere outside of Japan.

The continuing strength of the yen against the dollar and other currencies is making it more expensive for Toyota to export its cars, and that is costing it both profits at home and sales abroad. The implication: look for Toyota to become even more of a globalized brand, if that is even conceivable. Toyota already has 4 U.S. plants and some 160,000 employees at these and its U.S. dealers. Perhaps that is only a beginning?

N.Y. Times — BUSINESS | September 03, 2010
Toyota Feels Exchange-Rate Pinch as Rivals Gain
For all the turmoil over Toyota’s wave of recalls, the world’s largest automaker may face a bigger problem: the surging yen.

Toyota is now concluding that at least some of the 2000 reported cases of unintended acceleration by their cars have been proven to be driver error. Here’s the story:

As a driver, I had an experience in a rented car outside the Charlotte Airport that made me wonder. It was a foreign car, can’t recall the make, that I’d just rented on arrival. As I left the airport and drove a few blocks, I was alarmed that the car was slowing down when I wanted to go, then would barely move away from a green light. I pulled over into a gas station, and was about to return the hobbled car when I discovered the problem. The gas and brake pedals were closer together than I was used to, and my foot was pressing both at the same time, sometimes rocking toward the brake and sometimes the gas. The inconsistent placement or size of these pedals, compared with what I was used to, was the real problem. Once I realized this, I adjusted and drove off normally.

Could the placement or size of the pedals sometimes be the real problem in unintended acceleration? Does the size or shape of one’s shoe or angle of pressure based on leg length or physique factor in? Is this all already taken into consideration by the engineers and sufficiently accommodated, or if not, should standards be set or drivers be educated or warned about the differences? I wonder…

By Dexter Ford, on a NYT website: “I asked Bob Zeinstra, the national manager of advertising and strategic planning for Toyota Motor Sales, U.S.A., to clarify the claim. “The $1,000,000 an hour claim represents all Toyota R&D spending globally, much of that allocated to new quality and safety technologies,” he said in an e-mail message.

“So Toyota is counting every dollar it spends, worldwide, on research and development, whether the effort has anything to do with safety or not. Sona Iliffe-Moon, a Toyota spokeswoman, declined to estimate the proportion devoted specifically to safety.”

Wonder what the word for hyperbole is in Japanese”

McDonald’s and Shrek: How to Run a Recall
By SEAN GREGORY Thursday, Jun. 10, 2010

Whether you’re a fan of McDonald’s or curse the company for the effect of its food on your waistline, you can’t deny that the fast-food haven has improved its image over the years. McDonald’s now offers healthier menu options, like fruit and salad, and innovations like its McCafé coffee brand have been a hit with customers. Further, the company has always connected with kids. So when news hit that its Shrek-themed drinking glasses contained potentially dangerous levels of cadmium, a carcinogen that can cause kidney ailments, the results could have been severe. There goes McDonald’s again, creating a health hazard. And worse, they could be poisoning the kids who adore Ronald McDonald, Grimace and, by extension, those salty french fries.
So McDonald’s issued a swift recall of the offending glasses. And analysts are giving the company high marks for its response to a potential disaster. “The takeaway from all this is that they were very proactive,” says Jack Russo, an equity research analyst who covers McDonald’s for Edward Jones, an investment banking and advisory firm based in St. Louis, Mo. “You have to be prepared for the worst.” Russo was struck by the difference between the competent reaction of one multibillion-dollar corporation, McDonald’s, and that of another quite prominent one that’s been in the news lately, BP (he noted that the severity of their problems was quite different). “It was pretty brilliant,” says Sophie Ann Terrisse, CEO of STC Associates, a brand-management firm, of the McDonald’s response. “They came clean right away, and not only did they do what customers expected, they did more.”

To wit: for every consumer who returns one of the 7.5 million Shrek glasses the company says it sold, McDonald’s is offering a rare premium above the purchase price: a $3 refund for an item that cost $2.49 as a stand-alone purchase, and $1.99 with a purchase of food. “You’ve got to give them credit for turning the recall into a value proposition,” says Terrisse. It helps, of course, that McDonald’s can afford such generosity. Sales are strong; the company made $1.09 billion in the first quarter of 2010. Any financial hit from the company’s refund will be worth the positive vibe it creates with consumers.

The whole incident does carry some long-term risks. Although the Shrek glasses weren’t connected to the McDonald’s Happy Meal, which comes with a toy, many concerned parents might not make that distinction. “People are so buried with information, so on the go, they could just think Happy Meals toys got contaminated,” says Russo. Those kids’ meals are a cash cow for the chain — Russo notes that fries and drinks are high-profit items, and the incremental cost of adding a cheap toy to the mix is negligible. And since the toy is a huge reason that kids demand, and parents buy, the Happy Meal, any damage to its reputation could creep into the bottom line.

Still, Russo doesn’t see this bleak scenario playing out. “Their cachet with kids will not be destroyed,” he predicts. After all, what does little Johnny care about a recall? He’ll wail until he gets his toy, leaving his parents no choice but to purchase the Happy Meal. No chemical can quell his wrath. And no cadmium will slow down the McDonald’s momentum.

Read more:,8599,1995762,00.html#ixzz0qw2pQCGw

July 2020

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