By Mira Oberman (AFP) – Feb 4, 2010
CHICAGO — The US transportation chief's public rebukes of Toyota's handling of a massive safety recall have raised eyebrows, given the US government's major stake in rivals General Motors and Chrysler.
"The optics are terrible because -- and this is what happens when a government owns a company - the two companies that are going to gain the most out of this are General Motors and Chrysler," said Peter Morici, a professor at the University of Maryland's business school.
"But their behavior is consistent with the general policy of the US government, whether it's dealing with coffeemakers or cars."
Safety officials understand that product design mistakes are inevitable and will work to help companies correct the problem and alert consumers. But they will not tolerate a slow or weak response, Morici told AFP.
Transportation Secretary Ray LaHood sat down with reporters Wednesday to lay out a timeline of how US officials had "pushed Toyota to take corrective actions" on its pedal problems since 2007.
The meeting came a day after he issued a statement accusing the Japanese automaker of dragging its feet on recalling vehicles in danger of sudden, unintended acceleration due to pedals which could get trapped under floor mats or become "sticky."
He also caused a brief panic when he told a congressional panel that owners of 5.3 million Toyota vehicles affected by the recalls should "stop driving" them.
LaHood later sought to tone down his remarks, telling reporters: "What I meant to say and what I thought I said was if you own one of these cars or if you're in doubt, take it to the dealer and they're going to fix it."
But he insisted that safety officials "will continue to hold Toyota's feet to the fire to make sure that they are doing everything they have promised to make their vehicles safe."
Legislators meanwhile signaled that they would expand their probe, demanding answers on why Toyota's Tacoma trucks -- which have a different pedal assembly than the 5.3 million vehicles recalled -- were also experiencing problems with sudden, unintended acceleration.
Toyota's top US official, Yoshimi Inaba, is set to testify at a congressional hearing Wednesday.
LaHood's strong initial comments could cause some "hysteria, but to some extent, we are such a litigious society, he has no choice but to say that because of the lawsuits that are lined up," said Rebecca Lindland, an analyst with IHS Global Insight.
"If one more person is killed, they can say that the government didn't act; Toyota did not act."
Weston Konishi, an expert on Japan at the Mansfield Foundation think-tank, said he doubted either Washington or Tokyo wanted the Toyota flap to escalate.
"Toyota is now a real stakeholder in the US economy -- think of its auto plants and jobs -- so trying to score points against it would be somewhat self-defeating," he added.
Konishi said he could only see Toyota becoming the governments' business if the company cut off contracts with US manufacturers due to lack of confidence in quality control after the problems with the US-made pedals.
David Champion, director of automobile testing for Consumer Reports magazine, said the reaction to the recall was overblown.
"When you look at the statistics we are putting an awful lot of effort on a very small risk," he said.
"There has been something like 2,000 complaints of unintended acceleration in some 20 million Toyota vehicles -- it's almost like trying to find a needle in a haystack."
Champion lamented as "unfortunate" that it took the death of an off-duty California state trooper and three members of his family to prompt Toyota to issue a mass recall in September to address the problem.
But he said a congressional investigation was an "overreaction" and noted that the "sticky" pedal problem that caused Toyota to halt production and sales of eight models last month was not linked to any accidents or injuries.
"I'm sure it's going to hurt Toyota in the short term over the next year or so," Champion said.
"But if their products are as good as they have been in the past, we're going to see that Toyota's going to bounce back as Ford has from the Firestone (tire recall) fiasco."
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