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U.S. News and World Report Offers Five Reasons to Buy a Toyota

By RICK NEWMAN

Posted: March 2, 2010

It's hard to think of another company that nose-dived as fast as Toyota has. A few months ago, millions of drivers considered Toyota the gold standard for automobiles, with quality and reliability you could practically take for granted. Then came mysterious gas-pedal problems, claims of deadly "sudden acceleration" incidents, the global recall of more than 8 million vehicles, and vacillating assurances from shellshocked executives. The recalls could end up costing $2 billion or more. Toyota's sales have plunged, and its U.S. market share has fallen from 17 percent to 13 percent in just two months. The collapse rivals Enron or Lehman Brothers.

[See what Toyota could learn from Detroit.]

What's different about Toyota, though, is that it will recover. The automaker has deep pockets and tons of talent. Diffident CEO Akio Toyoda may not be the right man to lead Toyota through the worst crisis in its history, but sooner or later the company will regain control and get back on the pavement. It may even end up a better company than before. Meanwhile, Toyota automobiles could be a smart buy, with dealers forced to offer discounts and other incentives to move merchandise sullied by the scandal. Shoppers should research prices at sites like Edmunds.com or kbb.com to make sure that the price paid today is commensurate with the likely resale value down the road. If the price seems right, there are several other good reasons to buy a Toyota:

Safety concerns are exaggerated. The problems are serious, but political posturing in Washington and media hype have created the impression that every Toyota is dangerous. That's ridiculous. The sudden-acceleration incidents at the center of the controversy have been "linked" to 52 deaths over the past decade or so. Toyota has sold more than 20 million vehicles in the United States during that time. By those numbers, rough math suggests the odds of a sudden-acceleration fatality in a Toyota vehicle are on the order of 1 in 400,000—not exactly a death wish for somebody buying a Toyota. And those odds could end up much lower. Deaths now considered linked to sudden acceleration could later be proved to have been caused by something else—including drivers who were pressing the gas pedal instead of the brake. No driver wants to admit doing that, but the fact is, it happens.

[See 6 myths about car recalls.]

None of that is meant to disparage people who have been killed or hurt in a Toyota, and recent revelations depict a company that seemed unsympathetic to genuine complaints from customers. But the acceleration problem could turn out to be far less widespread than current hysteria suggests. It's worth recalling that the Audi sudden-acceleration incidents in the 1980s—at first thought to be related to vehicle flaws—were later proved to be entirely the fault of drivers. Meanwhile, by virtue of its woes, Toyota is probably paying more attention to safety right now than any other automaker, to include the extraordinary step of shutting down factories to retool the gas-pedal assembly in many popular models. Toyotas coming off the assembly line these days are probably subject to more quality control than most other cars on the market.

Recalls aren't the whole story. Being forced to recall millions of vehicles is a big deal, but Toyota still seems to perform better than other automakers when it comes to the kinds of complaints that lead to recalls. Data analyzed by Edmunds.com, for example, show that there have been many more complaints lodged against Toyota for sudden acceleration since 2005 than for any other automaker. But overall, Toyota has drawn far fewer complaints than most competitors, which is consistent with its once sterling reputation. Edmunds found that over the past 10 years, Toyota accounted for just 9.1 percent of all complaints filed with the government, even though it racked up 13.5 percent of all car sales. So despite the acceleration issue, Toyota still performs better than most in terms of complaints.

[See 10 fire-sale cars to avoid.]

Toyota's not alone. Internal documents showing that Toyota boasted of saving $100 million by avoiding a series of recalls make the Japanese automaker seem singularly sinister. But all automakers try to avoid recalls. Toyota just happens to be the one that got caught boasting about it, since it's the company under investigation right now—and subject to subpoena. And all carmakers know that the Obama administration is "not industry friendly," as another embarrassing Toyota document put it. Obama, like Bush, is requiring steep improvement in fuel economy, which will force all automakers to invest heavily in new engine technologies. That arguably hurts the Detroit automakers most, since their fleets get the worst gas mileage and they have the farthest to go. And anybody who still has doubts should ask Rick Wagoner or Fritz Henderson if the Obama administration is industry friendly; they were both forced to resign as CEO of General Motors, in the midst of the company's bankruptcy and federal bailout.

The cars are still good. Of 18 Toyota vehicles, seven rank in the top three in their category in the U.S. News Best Car and Truck rankings, including the Avalon sedan, Sienna minivan, Sequoia SUV, and Venza crossover. Five of 12 Lexus vehicles rank in the top three. In itslatest quality ratings, J. D. Power & Associates ranks Lexus first and Toyota seventh, out of 37 automotive brands. Consumer Reports named the Toyota Prius one of its 10 "Best Picks"for 2010, despite a recall involving brakes. And CR is poised to restore its coveted "recommended" status to eight vehicles it suspended from its ranking in the midst of the mushrooming recall controversy: the Avalon, Camry, Corolla, Highlander, Matrix, RAV4, Sequoia, and Tundra. Toyota's overall quality has slipped from the stratospheric highs of a few years ago, but there are still few automakers that can match its record across their entire fleet.

[See how Toyota stumbled in the first place.]

White-glove treatment. To win back customers and alleviate safety concerns, Toyota will pick up and return some recalled cars, so worried owners don't have to drive to the dealership. Toyota is also offering rental cars or rides to work to some owners getting their cars fixed. And CEO Toyoda has said that the company must start paying more attention to customers. Toyota certainly has room to rise: It ranks 17th out of 23 on J. D. Power's customer-service index. If Toyota is serious about rebuilding its business, it has to start by wooing skeptical consumers. That's a boon for buyers.

Comprehensive Analysis Raises Concerns About Gilbert Congressional Testimony, ABC News Segment

Click here to watch the March 8 webcast (viewers will need to register)

Sequence and Nature of Artificially Manipulated Faults Unrealistic,
Televised "Unintended Acceleration" Staged With Virtual Remote Throttle Control

TORRANCE, Calif., March 8, 2010 -- Today, during a live webcast, Toyota raised serious concerns about the validity, methodology and credibility of a demonstration of alleged “unintended acceleration” in a Toyota Avalon by Professor David Gilbert of Southern Illinois University and depicted in ABC News broadcasts and on-line segments.

A comprehensive analysis conducted by a world renowned engineering group, as well as testing by Toyota, has concluded the following about Professor Gilbert’s demonstration:

• The vehicle’s electronics were rewired and reengineered in multiple ways, in a specific sequence, and under conditions that are virtually impossible to occur in real-world conditions without visible evidence
• Toyota vehicle electronic systems were actively manipulated to mimic a valid full-throttle condition
• Substantially similar results were successfully created in vehicles made by other manufacturers.

In the demonstration dramatized by ABC on February 22, Professor Gilbert, assisted by segment reporter Brian Ross, asserted that he had detected a “dangerous” flaw in the Toyota electronic control system that he alleged could lead to unintended acceleration.

The following day, Professor Gilbert offered a preliminary report of his findings in testimony to the U.S. House of Representatives Energy and Commerce Subcommittee on Oversight and Investigations.

Engineers at Exponent, one of the country's leading engineering and scientific consulting firms, as well as Toyota engineers, have reviewed and recreated Gilbert’s demonstration with substantially similar results in representative vehicles of other makes.

Separately, at Toyota’s request, Dr. J. Christian Gerdes, associate professor of mechanical engineering at Stanford University and the director of the Center for Automotive Research at Stanford (CARS), conducted an independent review of Professor Gilbert’s testimony and the preliminary report presented to Congress.

Their findings were demonstrated today at a news conference during which the accelerator circuitry of a Toyota Avalon, as well as a sampling of well-regarded and popular competitive makes, was rewired and manipulated as Gilbert did in his demonstration.

Kristen Tabar, general manager of electronics systems, Toyota Technical Center, summarizes three of the major concerns with the artificial nature of Professor Gilbert’s demonstration.

“First, an electrical circuit that has been reengineered and rewired will not behave as it was originally designed and engineered,” said Tabar.

“Second, no automaker can or should be expected to design detection strategies for artificially created events in the absence of any evidence that such an event can occur in the real world.

“Third, if the artificial condition created by Professor Gilbert had occurred in the real world, it would have left readily detectable fingerprints.”

Exponent and Toyota engineers have found no evidence to suggest that any of the steps of Professor Gilbert’s demonstration exists in the real world. Thus, the fact that the Toyota Avalon used by Professor Gilbert did not show a Diagnostic Trouble Code after his demonstration does not indicate an undetectable safety defect. The same is true of the representative vehicles of other manufacturers tested by Exponent and Toyota.

Professor Gilbert’s reengineering and rewiring of the vehicle’s electrical system involves the following manipulations in a specific sequence. First, the protective insulation on two separate wires that carry the accelerator pedal position signals to the Engine Control Module must be individually cut or breached. Next, these wires are connected to each other through a 200 Ohm resistor.

This contrivance, by itself, did not cause an increase in engine speed. To cause an increase in engine speed, it is necessary to cut the insulation on a third wire, the 5-volt power supply to the accelerator pedal, and force a low resistance connection between the power supply and the secondary signal wire.

The resulting increase in engine speed is a result of the subsequent artificial and sudden application of the 5-volt power supply to this signal line with the rewired circuit. When subjected to similar unrealistic reengineering and rewiring, the competitive vehicles evaluated by Exponent and Toyota achieved substantially similar results with varying levels of resistances.

This manipulation of electrical components and a power source created artificial voltages that the engine control module, or ECM, would interpret as valid accelerator pedal signals. In essence, this test created a virtual, remote control accelerator pedal that replicated the vehicle’s own normally functioning accelerator pedal.

Also contrary to statements made in the ABC News story, had short circuits of the kind artificially created by Professor Gilbert occurred in real-world driving conditions, they would have left visible evidence such as damage or deterioration of the wiring and components.

As revealed in their testimony before Congress, Professor Gilbert’s Preliminary Report was commissioned by Sean Kane, a paid advocate for trial lawyers involved in litigation against Toyota and other automakers. Mr. Kane also appeared on the ABC News broadcast in support of the claim that Professor Gilbert’s demonstration revealed a flaw in the electronic throttle control system that could lead to “runaway” Toyota and Lexus vehicles. The relationship between Mr. Kane, Professor Gilbert and the trial lawyers who support Mr. Kane’s advocacy was not revealed by ABC News during the newscast, nor was Toyota offered an opportunity to view the demonstration or given time to respond.

Toyota believes that the public and Congressional committees have been misled by Professor Gilbert’s demonstration and the dramatization of it by ABC News. This has cast unwarranted doubt on the safety of Toyota and Lexus vehicles. Toyota remains confident in the integrity of the electronic throttle control system in its vehicles and there has been no reliable evidence of any kind to the contrary presented to the media or to Congress. Toyota’s electronic systems have multiple fail-safe mechanisms to shut off or reduce engine power in the event of a system failure. Extensive testing of this system by Toyota has not found any sign of a malfunction that could lead to unintended acceleration.

Toyota has commissioned Exponent to conduct a comprehensive analysis of the electronic throttle control systems in Toyota and Lexus vehicles. No limitations of any kind were imposed on Exponent by Toyota. This evaluation is ongoing. An interim report of Exponent’s findings has been provided to Congress and establishes the functionality of the electronic throttle control fail-safe systems. The final results of Exponent’s exhaustive analysis will be made public when completed. As with all such reliable engineering analyses, Exponent’s final results will provide the data and information necessary for others to validate Exponent’s conclusions.

# # #

Exponent, Inc. is a leading engineering and scientific consulting firm with expertise in over 90 technical disciplines. Exponent has a full-time staff of over 900 located in 23 international offices. Exponent’s multidisciplinary organization of engineers, scientists, physicians and business consultants, addresses complicated issues facing industry and government today. The firm’s consultants provide product design analysis, development, and testing; analyze failures and accidents to determine their cause and prevent their recurrence; and evaluate environmental and human health concerns to find cost-effective solutions. Exponent is certified to ISO 9001 and is authorized by the General Services Administration (GSA) to provide professional engineering services.

For information about Exponent capabilities and credentials visit www.exponent.com

MEDIA CONTACTS:

Toyota Motor Sales, Corporate Communications

310 468-5297
310 468-7359

Video of March 8 Webcast (viewers will need to register)

Exponent: Evaluation of Dr. Gilbert's Demonstration

Exponent: Evaluation of Dr. Gilbert's Demonstration (PowerPoint)

TMC Report: Duplication of Manipulated Faults in ETCS

Manipulations Used to Create a Fault Condition

Biographies:

Dr. Matthew Schwall, Managing Engineer of Exponent’s Vehicle Engineering

Dr. Shukri Souri, Principal of Exponent’s Electrical and Semiconductors practice and Office Director, New York

Kristen Tabar, Toyota Technical Center, General Manager, Electronic Systems 2

Related Links:

Toyota Statement on Rebuttal of Professor Gilbert’s 'Unintended Acceleration' Demonstration (March 5, 2010)

Toyota Update: Our Work With Exponent (Feb. 23, 2010)

Exponent's Letter to Congress (Feb. 23, 2010)

Toyota's Statement Regarding ABC News Broadcast Simulating Electronic Engine Controls(Feb. 22, 2010)

2010 Toyota Electronic Throttle Control Webinar (Feb. 22, 2010)

Toyota Update: Exponent Report on the Company’s Electronic Throttle Control System(Feb. 13, 2010)

Exponent's Statement of Qualifications (February 2010)

Washington's Toyota U-Turn

By KIMBERLEY A. STRASSEL

That vague screeching noise you hear in D.C., the slight odor of burning rubber? That's the government trying to brake its anti-Toyota campaign. It may be a little late.

The Toyota spectacle has become slightly surreal, as a few uncertain questions about "sudden acceleration" morphed into a media and political firestorm over the safety of its entire fleet. It is also proving an interesting case study in the treacherous politics that accompany government ownership of U.S. industry. Washington's initial enthusiasm in bashing Toyota is beginning to backfire.

There's no question that in the first, heady days of recall, at least some in the Obama administration and Congress saw advantage in undermining Toyota. The majority owner of Government Motors felt it couldn't hurt to fan the image of a "foreign" auto maker disregarding the safety of American drivers. Shoppers might just buy a Chevy instead, propping up government investment and bolstering United Auto Worker union jobs. And of course the trial bar would be thrilled by a fat new class-action target.

Vehicle recalls (there were 16.9 million in 2009 alone) are usually handled by the National Highway Traffic Safety Administration—but the Toyota case was commandeered by Obama Transportation Secretary Ray LaHood. He skewered the firm for being "a little safety deaf," complained it hadn't been responsive, and bragged it was the government that forced a recall.

"This is a big deal, this is a big safety issue," he exclaimed as part of the LaHood Vs. Toyota Media Tour. It was, in fact, the "most serious safety issue" of his tenure. It was, to repeat, such a huge, scary, safety deal that his "advice is, if anybody owns one of these vehicles, stop driving it." Mr. LaHood later claimed he'd misspoke.

Over in Congress, a geographically notable contingent of representatives piled on. Rep. Bart Stupak (D., Mich.) announced an investigation into "dangerous" malfunctions. Toyota was ordered to report to his Oversight subcommittee hearing next week. Rep. John Dingell (D., Mich.) berated the company for taking "two years" to step up and ripped them for not recalling more models.

UAW lobbyist Alan Reuther demanded Toyota make amends by keeping open a unionized factory in California, currently scheduled for closure. Chrysler, GM and Ford started offering cash incentives for car buyers to trade in recalled Toyotas for domestic wares.

The results of this campaign are now making pols queasy. It was inevitable that such a loud attack would lead to questions as to whether the administration was carrying water for the domestic industry. The White House is today fielding as many queries about its role as owner and regulator as Toyota is fielding about recalls.

This thinking also inspired reporters to dig into Congress's Toyota ties and to question, conversely, whether it can be tough enough. The press dredged up Senate Toyota investigator Jay Rockefeller's role in landing his state of West Virginia a Toyota plant. Did you know, the head of NHTSA, David Strickland, worked eight years for Mr. Rockefeller? Or that California Democrat Jane Harman, who sits on the House investigating committee, once made money selling stereo systems to Toyota? You do now.

It is also occurring to some Democrats that, while Toyotas are mainly assembled in red states, they are, uh, sold in blue ones. In addition to idled Toyota factory workers, Toyota dealerships and suppliers are getting hit by the company's sharp drop in sales. Some of these folks even live in Michigan.

The angry phone calls to Washington only increased last week when four governors—three Republicans and Kentucky Democrat Steve Beshear—sent a sharp letter to Congress, accusing the administration of a "conflict of interest." They unsubtly noted that many recent recalls were "as serious as or more serious" than Toyota's.

This sent the media digging into the recall record of U.S. auto makers, which may have to revisit their own safety issues. Some politicians are worried about Japanese retaliation against U.S. auto makers.

All of which accounts for Washington's recent piping down. Mr. LaHood devoted a lot of this week to touting stimulus grants. Quite a few Democrats have gone mute, leaving the issue to NHTSA and wishing it would go away. Some lawmakers are even stepping up to defend Toyota.

Yet having revved up the drama, the administration is now all but obliged to take action against Toyota, say with civil penalties. Mr. Rockefeller and other Democrats with ties to the carmaker are under pressure to get rough. And if Toyota bungles Washington as badly as it did the initial recall PR, this could go on a long time.

Toyota has not yet laid off a single one of its 34,000 U.S. workers, but that may change. Only a year ago, Democrats were wailing about economic damage if GM or Chrysler went bust. They forestalled that with government ownership. They, and Toyota, are now dealing with the all-too-easy-to-predict political behavior that followed such meddling in the private economy.

Write to kim@wsj.com

Printed in The Wall Street Journal, page A13

Texas governor backs Toyota

David Shepardson / Detroit News Washington Bureau

Washington -- Texas Gov. Rick Perry defended Toyota Motor Corp., suggesting that "union activists" and others are pushing criticism of the automaker.

In a Feb. 16 letter to the top Republican on the House Energy and Commerce Committee, Perry wrote that Toyota "is a valued employer and corporate citizen and an integral part of the Texas economy." The letter was released by his office today.

Perry is the sixth governor to back Toyota in letters to Congress in recent days. At least one of those, Indiana Gov. Mitch Daniels, plans to be in Washington next week as congressional hearings into Toyota's recalls open.

He noted that Toyota and its suppliers employ 3,000 workers at its San Antonio assembly plant that produces the Tundra, and soon will produce the Tacoma. And he said Toyota's 83 Texas dealers employ 7,500 people, with an annual payroll topping $300 million.

Toyota has recalled more than 6 million vehicles in the United States due to sudden acceleration concerns. It is halting production again at two North American assembly plants for a few days, after shuttering six plants for a week last month.

The company faces congressional hearings that begin Tuesday.

"The company has taken big steps to enhance its reputation for quality and to repair vehicles," Perry wrote. "It does sometimes appear, however, that the negative news is being encouraged by plaintiffs' trial lawyers, union activists and those interested in cutting into Toyota's market share."

Perry said that "Toyota workers are unfortunately caught in the middle" and everyone should "be able to agree that consumer and highway safety must take priority over grandstanding."

Perry, a Republican, is running against Sen. Kay Bailey Hutchison for re-election. She is ranking member of the Senate Commerce Committee, which is holding its own Toyota hearing on March 2 -- the same day as the Texas gubernatorial primary.

dshepardson@detnews.com (202) 662-8735

From The Detroit

MotorWeek Announces 2010 Drivers’ Choice Award Winners

OWINGS MILLS, Md. - (Business Wire) MotorWeek, television's longest running automotive series, announced the winners today of its 2010 Drivers' Choice Awards which recognize best in class vehicles in a variety of lifestyle categories. "Emerging from what was a difficult year, this year's winners represent new benchmarks being set by the auto industry for engineering, design and fuel efficiency," said MotorWeek host and executive producer John Davis.

The Toyota Prius took top honors as Best of the Year for making improvements on virtually every front including, fuel efficiency, power and versatility. It was also named Best Eco-Friendly.

"The Prius winning the prestigious MotorWeek Drivers' Choice Best of the Year and Best Eco-Friendly awards is truly an honor that reflects how far hybrid technology in the U.S. has come in one short decade," said Bob Carter, Toyota Division group vice president and general manager. "Since it was introduced in 2000, the Prius has been an icon for positive change. Now, with over 800,000 currently on American roads, Prius has helped change the way people think about transportation, the roles cars play in the environment, and what people could expect from their cars in the future."

"If you can only buy one car for your family, the 2010 Prius is the one," said Davis. "The Prius is a no-compromise vehicle that offers impressive efficiency, cutting edge technology, smart packaging and truly iconic styling." (Statement from John Davis regarding recall quoted below* or can be downloaded by clickinghere)

The entire list of winners will be featured on MotorWeek beginning February 13th on PBS (check local listings). MotorWeek's Drivers' Choice Awards have been presented annually since 1983, and are among the auto industry's most prestigious honors.

Despite a tough year for domestic automakers, Detroit produced some standouts with ambitious remakes of existing models. Calling it a "stellar effort that speaks volumes about where Ford is headed," the Taurus took top honors as MotorWeek's Best Family Sedan.

General Motors was recognized by MotorWeek for a trio of outstanding vehicles. With best in class fuel economy, including hybrids, the Chevrolet Equinox captured the title as Best Small Utility, while the Buick LaCrosse took Best Luxury Sedan for delivering stunning good looks and quality inside and out. "These two vehicles have moved the benchmark for affordable vehicles in their class quite a few notches higher," said Davis. The iconic Chevrolet Camaro took home MotorWeek's Best Sport Coupe award. Best Small Car went to the Mazda3 for having the "soul of a sports car," while the new Nissan 370Z Roadster took the title as MotorWeek's Best Convertible.

German automakers dominated the high performance segments. Audi received two nods from MotorWeek; the S4 was named Best Performance Car, and the R8 5.2 FSI Best Dream Machine. The Mercedes-Benz SLS AMG shared Best Dream Machine honors, while the BMW 3-Series won Best Sport Sedan.

Two 2009 winners held on to their titles. For the second year in a row, the Ram 1500/2500/3500 drove away with Best Pickup and the Honda Pilot won for Best Large Utility.

The editorial staff of MotorWeek test drives more than 150 cars, trucks and utilities each year. Drivers' Choice Award winners are chosen following a comprehensive evaluation of factors that matter most to consumers - performance, technology, practicality and value.

The winners are: Best Small Car: Mazda3; Best Family Sedan: Ford Taurus; Best Luxury Sedan: Buick LaCrosse; Best Small Utility: Chevrolet Equinox; Best Large Utility: Honda Pilot; Best Pickup Truck: Ram1500/2500/3500; Best Eco-Friendly: Toyota Prius; Best Sport Sedan: BMW 3-Series; Best Sport Coupe:Chevrolet Camaro; Best Performance Car: Audi S4; Best Convertible: Nissan 370Z Roadster; Best Dream Machine: Audi R8 5.2 FSI/Mercedes-Benz SLS AMG.

MotorWeek is one of the nation's leading sources for automotive industry news, new car information and driving entertainment. The award-winning series, seen nationwide on PBS, SPEED and V-me, is produced by Maryland Public Television. For more information on MotorWeek and the Drivers' Choice Awards, visitmotorweek.org.