Toyota Case Analysis

654 Words3 Pages
Identification: This case study depicts a severe problem for Toyota company which will affect its future sales, brand loyalty, customer relationship and as well as the financial loss. The basic issues that can be identified are: first issue is manufacturing fault in Toyota cars declared by NHSTA (National Highway Safety Traffic Administration) after receiving 6,200 complaints about SUA (Sudden unintended acceleration) from Toyota owners; second issue is legal proceedings the company has to follow, these legal proceedings include 38,000 complaints and 140 class action lawsuits. This figure for number of complaints is a real threat to the reputation and brand image of the company. Thirdly Toyota has an allegation of misleading U.S federal regulators since Toyota has known for at least seven years that it had a SUA problem with some models that it could not explain. Evaluation and Analysis: For the first problem the Toyota’s explanations for the first issue states that sometimes floor mats interference with the accelerator or moisture has gotten inside gas pedals and caused them to stick or sometimes drivers have hit the wrong pedal with their foot. In my opinion the reasoning for poor manufacturing is not well justified because number of research studies have claimed this reasoning to be wrong1. In some reports it is demonstrated that, Toyota has known that it’s ECU- the computer that manages the engine systems, via sensors – does not always work as intended. Electronic malfunctions can occur that are not detected by the ECU. This shows Toyota is lacking the production competence. This incompetency can lead to increase in the cost of production, increase in production wastage, showing that Toyota is providing a competitive edge to its competitors by not utilizing technology in an efficient manner. Secondly huge number of legal proceedings will lead to negative brand
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