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UK Web Site Attacks Wall Street Journal Report

Friday, July 16th, 2010

The “unnamed source” has been used by journalists to expose important news stories (“Deep Throat” helped Bob Woodward uncover Watergate) but has also been used to mask ineffective coverage. Conflicting reports concerning Toyota and the NHTSA investigation of its “sudden acceleration” recalls have both relied on “unnamed sources” at the NHTSA.

The Wall Street Journal cited an unnamed source that claimed that results of NHTSA tests indicate that “driver error” is the leading cause of unintended acceleration in Toyota. According to the article, no new defects (beyond the sticky accelerator and the floor mat interference issues previously addressed by Toyota) have been found.

However, an automotive web site has made the claim that Toyota “planted” the story with the Wall Street Journal, again citing “unnamed sources” at the NHTSA. The article, which first appeared in just-auto.com, has been picked up internationally.

Since there is no NHTSA report as yet, the NHTSA has not officially commented, one way or the other. In the meantime, the question is being elevated to “he said, he said” status. But is this entirely fair?

First, the Wall Street Journal article appears to be true. Whether it was instigated by Toyota or by “unnamed sources” at the NHTSA aside, it appears to accurately describe the NHTSA investigation.

Second, it is logical to conclude that a writer at the Wall Street Journal might have access to sources at the NHTSA. Less likely is that just-auto.com has access to those sources. Just-auto is a UK-based web site. The author of the article, Simon Warburton, has been covering the automotive industry as a web journalist for only about six months now. It seems unlikely that he has uncovered a source at the NHTSA who is willing to attack the credibility of Toyota and the Wall Street Journal while no other media outlet in the world has uncovered such a source.

Still, in the world of instant news, somehow the just-auto story has been elevated to the same status as the Wall Street Journal story. It’s just easier to repeat the sensational headline than to do a little research.

Toyota Creates Program to Investigate Cases of Unintended Acceleration

Tuesday, April 13th, 2010

In response to continued issues of unintended acceleration, Toyota has created a process for “quick evaluation of unintended acceleration reports.” The program, called the “SMART Business Process” (“Swift Market Analysis Response Team”) is intended to speed up the process by which Toyota deals with each report of unintended acceleration.

In each case, Toyota hopes to respond to customers within 24 hours to set up a “comprehensive on-site vehicle analysis.”

Toyota hopes to diffuse complaints caused by its poor handling of recent massive recalls- both from a legal standpoint as well as from a customer-satisfaction standpoint. It also hopes that the program will restore some faith in its quality.

It may be too little, too late once again for Toyota as it continues to trail behind its problems and customer concerns. Given the severity of this issue (from either a safety or even just a PR perspective), a 24-hour response time is something Toyota should have been doing some time ago. Advertising it may just seem disingenuous.

Executive Urged Quick Action in Recall

Thursday, April 8th, 2010

On January 16, 2010, as Toyota executives debated how to handle the question of sticking gas pedals. As the executives debated the situation, then Irv Miller urged his colleagues to make the information public.

“We are not protecting our customers by keeping this quiet. The time to hide on this one is over. We need to come clean.” Miller added, “We better just hope that they can get NHTSA to work with us in coming with a workable solution that does not put us out of business.”

As other executives argued that the problem should be kept quiet until a solution could be found, Miller expressed his concerns that the accelerator problem was a safety issue and that Toyota needed to act quickly in announcing that.

Miller was group vice president for environment and public affairs at the time. His February 1 retirement was announced on December 16. His e-mails are a part of the 70,000 pages of documents that the government has received from Toyota as part of its investigation of the automaker’s handling of its recall issues.

Toyota issued a statement saying that it, “does not comment on internal company communications and cannot comment on Mr. Miller’s email.”

NUMMI Closes, Faces Uncertain Future

Tuesday, April 6th, 2010

The last car rolled off of the NUMMI production line at 9:21 am local time on April 1. It was a red Toyota Corolla S that is believed to be destined for a museum in Japan.

The NUMMI (New United Motor Manufacturing, Inc.) plant was opened by GM in 1962 and closed in 1982. Toyota and GM reopened the plant in 1984 as a joint venture. As part of its restructuring following bankrupcy, GM pulled out of NUMMI in August, 2009.

NUMMI’s closure affects over 5,000 workers.

The future of the facility remains uncertain. Aurica Motors has announced that it would be interested in using the facility to produce electric cars. Though the announcement garnered much attention, it is generally considered unlikely since Aurica Motors is too small to support the NUMMI facility. In fact, Aurica has produced designs for an electric car but has yet to actually produce any vehicles. Many doubt that the company could even afford the $50 million annual electric bill for the NUMMI facility. Even the more established Tesla Motors turned down the NUMMI facility because it is “about 10 times the size of a facility Tesla would need.”

Also being considered is the possibility that the property might be used to build a new stadium for the Oakland Athletics baseball team.

NHTSA Seeks Maximum Fine for Toyota

Tuesday, April 6th, 2010

The NHTSA has announced that it will seek the maximum fine against Toyota for failing to report its “sticking accelerator” issue in a timely manner. Federal law allows a maximum fine of $16.5 million.

Manufacturers are required to report safety defects to the NHTSA within five days of discovering the problem. Toyota became aware of the problem in September, prompting the fine.

In response to the reports of the fine, Toyota has issued the following brief statement:

While we have not yet received their letter, we understand that NHTSA has taken a position on this recall. We have already taken a number of important steps to improve our communications with regulators and customers on safety-related matters as part of our strengthened overall commitment to quality assurance. These include the appointment of a new Chief Quality Officer for North America and a greater role for the region in making safety-related decisions.

Toyota does have the opportunity to dispute the fine. When GM was fined $3 million for a violation in 2004, it was able to negotiate the fine down to $1 million- thus far, that’s the largest fine ever by the NHTSA.

Grounds for dispute include the fact that there may be political motivation behind the size of the fine given that it is so high compared to any other similar fine. Also, the specific violation that resulted in the fine has resulted in no serious crashes, injuries or deaths.

Additionally, documents show that Toyota was aware of the defect but did not recognize it as a safety issue. It was considered a convenience issue because the pedals get stuck only slightly depressed and the car can easily be controlled using the brakes. As a convenience issue, Toyota was not required to report the defect to the NHTSA and could easily dispute the fine because of that.

Still, there is speculation that Toyota may decide to simply pay the fine to avoid the continued negative publicity that would come from disputing the fine.

The NHTSA has also has stated that although this is the maximum fine for a single violation, it may still impose further fines if it determines that there were further violations by Toyota.

Runaway Prius Driver’s Story Contains Inconsistencies

Wednesday, March 10th, 2010

Jim Sikes, driver of the widely reported “runaway Prius” earlier this week, has told his story. However, ToyoLand.com has discovered potential inconsistencies in Mr. Sikes’ story.

The first question- one investigators will be looking at closely- is how the car was able to accelerate while the brake was depressed. The Prius comes with a brake override system that should automatically halt acceleration once the brake is depressed. If the problem was caused by “unintended acceleration,” then the braking system would have had to fail as well.

Second, Mr. Sikes claims to have taken his recall notice to a dealer two weeks ago only to be told that his car was not a part of the recall. Although the 2008 Prius he was driving was involved in a November, 2009 recall for the floormat issue, no recall letters have been sent to Prius drivers yet- those are scheduled to be sent out later this year as part of a “rolling” recall that has begun with other Toyota vehicles. Toyota has, however, sent preliminary notices to Prius owners informing them that a recall notice will be sent. That notification also suggests that drivers remove any floor mats from the driver’s side (Sikes had not removed his floor mats) and details clear instructions as to how to stop a car involved in unintended acceleration (Sikes specifically claims to have done exactly what he shouldn’t have according to these instructions).

Third, Sikes claims that he reached down with his hand and pulled the accelerator hard enough to cause discomfort in his shoulder even after the incident had ended. Perhaps he is particularly flexible or has very long arms, but this is a task that most drivers would find difficult even with the car parked- much less with the car accelerating out of control through traffic.

Fourth, the incident took place at speeds up to 94 mph over a period of 23 minutes. If Mr. Sikes had been “standing” on the brake for that whole time, as he claims, and assuming that the brake override system had simultaneously failed, there is a question as to whether there would be any brakes left at all when the car did come to a stop. The CHP Officer involved does claim to have “smelled the brakes” and to have “seen the brake lights coming on.” (emphasis given by ToyoLand.com)

Finally (for now), if the brakes had failed to stop the car, the emergency brake would have added little to the solution. The emergency brake in the Prius is simply a mechanical means to apply the drum brakes for the rear wheels- the same brakes that were supposedly depressed hard enough to cause an odor.

One final note- Jim Sikes’ story is certainly going to be questioned in coming days. One has to try to anticipate any perceived motive that he might have for fabricating or embellishing his story. To that end, our research indicates that Mr. Sikes had auditioned for a California Lottery TV game show. He is a “longtime lottery player,” who has won $55,000 in the lottery. He is a self-proclaimed, “real estate agent to celebrities.” The agency he runs even has a fleet of– PT Cruisers with the company advertising painted over the entire vehicle.

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