Toyota Case Study

Toyota 2009-2010 Recall Case Study
Crisis Communication
Paige Leary
JMA 410 PR Strategies & Case Studies
Duquesne University
Diane Wuycheck
Running Head: TOYOTA CRISIS COMMUNICATION 2
Table of Contents
Case Overview_______________________________________________________3
The Recall___________________________________________________________4
Background of Toyota_________________________________________________7
Effects of the Recall___________________________________________________8
Cross- Culture Complications________________________________________9
Communication Methods______________________________________________10
Toyota Advertisment__________________________________________________11
Toyota’s Target Market________________________________________________15
Evaluation of Target Market________________________________________16
Toyota Objectives____________________________________________________17
Taking Action___________________________________________________20
Communication Stategies_____________________________________________22
Evaluations_________________________________________________________ 26
Conclusion__________________________________________________________28
Appendix___________________________________________________________30
References__________________________________________________________32
Case Overview
This study focuses on Toyota’s 2010 vehicle recall and their response to the
crisis. Known as one of the most reliable and popular car brands, Toyota faced major
scrutiny and negative reactions from the recall. The company recalled over 8.5 million
vehicles due to sticky gas pedals and unintended accelerations, which lead to serious
accidents and even, resulted in death. Used to having a good reputation, Toyota wasn’t
used to this bad reputation and negatively and needed to come up with a plan to deal
with the public and restore the brand.
The Japanese company had serious complication while creating the perfect
method of communication because of the cultural differences between Japanese and
American public relations. As time went on the public started to see the brand as
untrustworthy and unsafe because of the quality and lack of information Toyota was
releasing to the public.
Finally, Toyota began releasing information about the recalls, apologies and
solutions on how they plan on fixing the problem. As the crisis started to relax, Toyota
created safety campaigns and advertisements that proved their mission of safety and
customer satisfaction. They connected with customers on another level through social
media and survey communication and answered questions they had. Toyota had to
change their targets with these new campaigns and focus on the big picture how the
brand is perceived as a whole. Though their crisis control methods were not flawless,
they worked through the problem and have rebuilt their reputation in the past six years.
Through the crisis Toyota used strategies like creating a new slogan, better
technology and releasing new vehicles, which helped, resurface the brand and take
heat off of the crisis. These strategies are seen still to this day and continue to benefit
the company.
The crisis as a whole was learning experience for Toyota because they have
never had a serious crisis before. They now have a plan for any future crisis or
complication in any type of culture. The managers of the company have become better
leaders and understand the importance of cross-cultural communication and are better
prepared any issue that may arise. Toyota now is back to focusing on their main
mission of safety and customer satisfaction.
The Recall
At the end of 2009, Toyota Motor Corp. was one of the top leaders in the auto
industry. However, within a few months, Toyota recalled over 8 million of their vehicles
to address the serious issue of “unintended acceleration”, brake problems and “sticky
gas pedals”. National attention started focusing on Toyota on September 10, 2009
when a recording of a 911 call of a car crash in California, killing a police officer and his
family, was released. The crash was caused by “uncontrollable acceleration” and led to
3.9 million Toyota vehicles to be recalled on September 29, 2009 (Quelch et al, 2010).
In early February 2010, 2.3 million vehicles were recalled for sticking accelerator
pedals, which resulted in a suspension of eight models in North America, Europe and
China. The third recall was for brake problems on the company bestseller, Toyota Prius
Hybrid. The recalls totaled about 8 million vehicles worldwide in 2009-2010, with six
million in the United States (Quelch et al, 2010).

The Department of Transportation and the National Highway Transportation
Safety Board (NHTSB) increased the investigation on Toyota after the large amount of
recalls and conducted hearings in March 2010. This was something Toyota was not
used to because Toyota had a positive brand image before the recall and didn’t face a
lot of scrutiny at the beginning of the crisis (Jones, 2010). However, the responses from
Toyota’s public relations team were considered poor and the public saw Toyota’s
responses as insufficient. The public, customers and future customers started to see
the company as dishonest and untrustworthy.
Toyota vehicle sales in the U.S. fell 16% in January 2010 and 8.7% in February
compared to the previous year. Toyota shares lost 11.6% through February 23, 2010
(Quelch et al, 2010). The Toyota recall crisis was a nationwide news story with media
coverage in newspapers, blogs, forums and television news, which presented a
massive crisis for the motor company. (Fan, 1988; Fan & Cook, 2003)
Below is a chronological timeline of Toyota recalls from the Guardian Newspaper in
2010.
September 2009: Toyota announces the biggest recall in its history over fears involving
almost 4m vehicles in the US that accelerator pedals could become trapped in floormats
and "may result in very high vehicle speeds and make it difficult to stop the vehicle,
which could cause a crash, serious injury or death".
21 January 2010: Toyota says it will recall around 2.3m vehicles in the US to fix
potentially faulty accelerator pedals. The action comes on top of the ongoing recall of
some 4.2m vehicles over "pedal entrapment" risks.
26 January 2010: Toyota says it is suspending US sales and halting North American
production of eight models involved in accelerator pedal recall, including the country's
best-selling Camry.
28 January 2010: Toyota says it will widen the net to include Europe - potentially
involving Britain - and China in its recall scheme. US congressional investigators launch
probe into accelerator problems. US Congressional investigators request information
from Toyota and US safety regulators on the recall ahead of a hearing on 25 February.
29 January 2010: Toyota says recalls in Europe could reach 1.8m vehicles and affects
eight models including Yaris and Auris.
1 February 2010: It emerges that Toyota drivers will have to wait at least three weeks
before finding out if they own one of the estimated quarter of a million cars in the UK
suspected of having "sticking" accelerator pedals.
2 February 2010: Toyota's executive in charge of quality control, Shinichi Sasaki, says
the "unprecedented" operation is likely to have a bigger effect on sales than previous
recalls and had already hit sales in January.
3 February 2010: Toyota owners in the UK and US are advised by lawyers to stop
driving their cars immediately amid growing concern over the potentially lethal
accelerator fault. A new defect is reported in Toyota's Prius hybrid model that could
result in yet another recall. US authorities say they are investigating 100 complaints,
with Prius owners reporting momentary loss of braking ability at low speeds on bumpy
roads. Toyota in the UK says it has sent details of the 180,865 affected UK vehicles to
the DVLA and is working with the DVLA to identify and contact owners "as quickly as
possible". It tells affected drivers that a 30-minute repair will be carried out at Toyota-
approved service centers.
4 February 2010: Toyota admits it will suffer $2 billion as a result of the global safety
recall affecting millions of cars. The Japanese government urges Toyota to look into 77
reported cases of braking problems among new Prius models sold in Japan.
5 February 2010: It emerges Toyota treated the accelerator fault as a quality issue
rather than a safety issue when it first became aware of the problem in the winter of
2008/09. It failed to inform the UK's Vehicle and Operator Services Agency (Vosa),
which registers recalls on cars, about the fault until 22 January 2010, after the
government demanded information.
Toyota's president, Akio Toyoda, finally emerges to apologize for the sticky accelerator
problem. "We are in the midst of a big crisis and face big challenges ahead," Toyoda
says.
9 February 2010: Toyota confirms a global recall of all third-generation Prius cars
manufactured before 27 January 2010. It affects 8,500 cars in the UK, where the latest
Prius model went on sale last August.
"This recall will consist of a software upgrade in the anti-lock braking system. In the
meantime, the cars are safe to drive. At no time are drivers without brakes," ToyotaGB
insists.
17 February: Toyota announces it will install a brake-override system in all future

models worldwide. It is considering a recall of the Corolla because of possible power
steering problems. The US government demands that Toyota hand over documents to
show whether it acted promptly with the safety issues in its cars.
19 February: Akio Toyoda bows to US pressure and agrees to appear before a

congressional hearing into the crisis. The company also confirms it will confirmed it
would suspend production at its plant in Burnaston, Derbyshire, for two weeks.
22 February: Leaked emails show that Toyota staff boasted about how they had saved
the company $100m by persuading American regulators that they did not need to
implement a full recall over problems with its floor mats.
23 February: Toyota faces the prospect of criminal charges after a US grand jury issues
a subpoena, demanding more evidence relating to the recalls. And a man jailed after
crashing his Toyota, killing three people, demands a retrial - and relatives of the victims
say they support him (The Guardian, 2010).
Background of Toyota
Toyota is a Japanese automotive manufacturer, founded in 1937 by Kiichiro
Toyoda, headquartered in Toyota, Aichi, Japan. It is the 13th largest company in the
world by revenue and is made up of over 330,000 employees worldwide (America’s
Best Employers). The companies mission statement is "To attract and attain customers
with high-valued products and services and the most satisfying ownership experience in
America"(Toyota Mission). They are ranked #257 as the best employer and as the
Worlds 8th most Valuable Brands as of May 2015 (America’s Best Employers).
Their philosophy of Kaizen, meaning
continuous improvement, is found in their
production, employees, business models
and is the heart of the company
(Toyota.com).
The Effects of the Recall
According to Akio Toyoda, Toyota’s President, the company’s traditional priorities
are safety first, quality second, and volume third. However, According to Quelch et al
(2010) and Steinmetz (2010), Toyota’s rapid growth put strains on design, engineering,
and manufacturing which lead to quality issues and recalls which began in 2003. This
shift in Toyota’s priorities away from quality and onto quantity reveals a problem with
their business policies and communications team. This change in priorities is what
resulted in the life threatening automotive issues and lead to the millions of recalls. “We
[Toyota] pursued growth over the speed at which we were able to develop our people
and our organization,” which “resulted in the safety issues (United States Cong. 2010).”
Below is the list of affected vehicles according to the Dickinson Press.
Avalon: 2005-2010 Corolla: 2009-2010 Camry: 2007-2010 Highlander: 2010
Sequoia: 2008-2010 Matrix: 2009-2010 RAV4: 2009-2010 Tundra: 2007-2010
Tacoma: 2005-2010 VENZA: 2009-2010 (Call, 2010)
After Toyota had recalled a total of 8.5 million vehicles American Toyota owners
had become very distrustful towards the company that was previously known as one of
the safest car brands. This bad brand image didn’t happen because of the company’s
actions, but because of its inactions during the crisis. Their public relations response
time to the recall crisis was slow, which made it seem like the company had something
to hide or that they didn’t have a solution. Toyota CEO, Toyoda, didn’t make an official
statement until February 5t, 2010, six months after the first accident was recorded (“A
Timeline of,” 2010).

Toyoda statement,
“Toyota has, for the past few years, been expanding its business rapidly. Quite
frankly, I fear the pace at which we have grown may have been too quick. I
would like to point out here that Toyota’s priority has traditionally been the
following First; Safety, Second; Quality, and Third; Volume. These priorities
became confused, and we were not able to stop, think, and make improvements
as much as we were able to before (Testimony to House).”
Cross- Culture Complications
Although it seemed like Toyota wasn’t being transparent with the public they had
been taking serious action behind closed doors. The misconception was because
Toyota practiced a Japanese style of public relations, which is very different than what
American public relations have been taught. These cultural differences made it very
difficult to correctly inform their target publics in Japan and America, which caused
confusion and serious backlash the public.
When a company is responsible for a crisis in American business the public
expects quick answers, explanations and apologies for the problems they caused. In
Japan however, the president or CEO of a company will bow as a form as apology and
regret for the problem. In the CBS article, “Toyota’s President Getting a Harsh PR
Lesson”, Toyoda is scrutinized for his dishonesty and poor management skills because
he follow Japanese business culture of making a decision through quiet conversations
between employees and company leaders (Reid, 1999).

Communication Methods
Toyota dealerships all over the country were receiving calls about what to do with
vehicles that have been recalled. The recalled vehicles sales were being suspended
and owners of these vehicles could take their car to a Toyota dealership to have the
problem fixed. These of the recalled vehicles and promised to fix any of the vehicles if
they were brought into a dealership. Scott Ehrlich of Ehrlich Motors, a
Toyota dealership in Greeley, Colorado said the company is working on getting parts to
fix the problems with the recalled cars that were on the road.
"There's a peace of mind knowing if you come in and perform the (fix) on the car,
the chances of (the gas pedal sticking) are less to none. Chances of it happening
now are extremely slim to none. We've not had a single incident in Greeley,
Colorado. Our dealership is not aware of any (Dunn, 2010)."
These free inspections are for any Toyota vehicle, recalled or not, to give Toyota
owners some comfort knowing that their car would not have any unintended
acceleration or sticky gas pedals. Ehrlich thinks that Toyota is doing everything in their
power to give customers the best service through this crisis. "This is a
voluntary recall. Toyota was determined to do this. And they're going way above and
beyond (Dunn, 2010)."
As the heat of the recall started to distinguish Toyota took steps to improve the
company’s brand image and communication methods. They released an advertising
campaign showing that they are committed to the quality and safety of their vehicles
and dedication to keeping their drivers safe. “What we're dealing with is a perception
issue, and brand perceptions are not brand realities," said Bob Carter, Toyota Division
general manager. "If a customer has removed us from their consideration list, it was
because of a perception of Toyota safety (Retchin,
2010)."
Toyota Advertisements
Carter said the theme of safety for Toyota will
be a long-term advertisement campaign for the
brand until the customer’s perception of the brand
change and become trustworthy again. "If you look
at various attributes of cars -- performance,
handling, value -- those are set like a volume knob
[on a stereo] by consumers," Mr. Carter said in an
interview. "But safety, that's a light switch.
Either you have it or you don't (Retchin,
2010)."
The advertisements featured in the
new Star Safety System (See Appendix 1)
included VSC: Vehicle Stability Control,
TRAC: Traction Control, ABS: Antilock
Braking System, EBD: Electronic Brake-force
Distribution, BA: Brake Assist and SST:
Smart Stop Technology.

According to Toyota’s public statement,
“All 2011 Toyota models came standard with the Star Safety System.™
This integration of active safety features is designed to protect occupants by
helping drivers avoid accidents in the first place. The Star Safety System has
been developed to help you drive your vehicle with confidence, knowing that,
when you need it most, the car’s safety systems can help you stay in control.
Every time you climb into your vehicle, Toyota’s Star Safety System can help to
keep you out of trouble, whether it’s a run to the corner store or a long road trip
with friends or family (Toyota STAR).”
An example of the campaigns television advertisements is a story of a mother
who is watching her son play football discusses the technological advancements of
Toyota’s vehicles. She then talks about the safety testing of their vehicles, sending a
message to the target audience that safety is Toyota’s number one priority (Toyota
Crisis Management Campaign, 2010). This advertisement targets middle class families
who believe safety is the most important factor of a vehicle.
Overseeing the campaign was Vice President of Marketing, Bill Fay, who
understands what their publics what in a campaign. "We need to make an emotional
connection with people who own or are considering our product. We need to address
the concerns of the customer, based on what we've been through this year." Fay ran the
safety campaign through 2011 and Toyota is still a brand that focuses on safety. "This is
not a short-term thing where we run an execution or two," Mr. Fay said. "We still have
QDR. We just have to assure customers that's the case (Retchin, 2010)."
The other campaign Toyota used was the “Commitment Campaign”. These
advertisements highlight the history of Toyota in America over 50 years. It states that
their top priory has always been safety, reliability and high quality since their early years
in America and is accretive of the fact that they have not been living up to this reputation
through the recent events. This campaign shows Toyota accepting responsibility for the
problem with their vehicles and that they have fixed these problems.
They used television ads and also print which were published in newspapers,
magazines and online (See Appendix 2). The ads were in black and white and showed
photos of old Toyota dealerships, workers and customers in hopes to restore their
customer’s faith in the company (Toyota Crisis Management Campaign, 2010). Toyota
used these prints to show their clientele that they are a historically reliable company and
have been for many years. They want to show that although they are having a problem
they have had many good years of safe products.
Toyota also had many press releases that were updates regularly throughout the
crisis. Rachel Knoespel of Marquette University studied these press releases and how
Toyota responded to the incident.
“I studied all of Toyota’s public press releases which were found on Toyota’s
website, though a close textual analysis. This is where I discovered Toyota
responded in three distinct phases during only two of the crisis life cycle stages,
which were the current and critical stages. The themes that emerged were:
Phase 1 where Toyota spoke as a united front and focused on its past
performance; Phase 2 where Toyota finally provided a masked apology while
also explaining its superior technology and exuding confidence; and Phase 3
where Toyota began to feel threatened and lashed back with a defensive
response. I concluded by examining how the themes worked together. Using
masked apology and confidence together seemed to reduce the strength of
Toyota’s apology (Knoespel, 2011)”.
Lastly, Toyota turned to social media to directly
communicate with their customers. On February 8,
2010, President of Sales, Jim Lentz, responded to 10
questions out of 1,400 that were submitted using a
Digg Dialog website. The questions and answers
were compiled into print advertisements helped to
improve customer communication (Christians, 2015).
The ads were called “Consumer Questions” and are
still posted on the Toyota website (See Appendix 3 &
4).
(Toyota News)
This crisis was extremely detrimental for Toyota because they have always been
one of the top global brands. They maintained a positive record in regards to other car
companies and have had great customer feedback. The severity and frequency of the
accidents causes a huge news presence and which forced Toyota to rebuild their brand
to the prior positive image (Knoespek, 2011).

Toyota’s Target Market
The United States holds up to 30% of Toyota’s total consumers. Due to the
number of vehicles models and difference in pricing, Toyota bases their target market
on the specific vehicle and believes in the philosophy of “Right Car in the Right Place”
for the right person (Dobin, 2002). However, they have a clear focus on customer
satisfaction and a mission “to sustain sustainable growth by providing the best customer
experience and dealer support" which is posted on their website (Toyota).
Their demographic are those who have a license, especially families who are
environmentally aware. Their customers live in both rural and urban settings and travel
via car on a daily basis. They are value oriented, price conscious and believe safety is
the most important factor of a vehicle (Feenstra, 2014).
Due to the mass number of vehicles recalled in 2010 and the variety of models,
Toyota had to target a larger audience than usual. They weren’t focusing on price,
location or the environment and instead put all their focus in safety. They needed to
connect to all of their existing customers, future customers and the entire nation
because of the massive news coverage the crisis was receiving.
Those that were most affected were the owners of the recalled vehicles because
they were the most in danger of a potential accident. Their first priority was to connect
with these customers with a written apology, which stated:
“For two generations, we have provided Americans with cars and trucks that
are safe and reliable. And we fully intend to produce even safer, high quality
vehicles in the future...” He continues saying, “We acknowledge these mistakes,

we apologize for them and we have learned from them (Knoespek, 2011). These
apologies focused on reliability and Toyota’s self-acknowledgement of their mistakes.
Evaluation of Target Audience
The audiences that were targeted were the best and most effective group for
Toyota. Although they didn’t follow a traditional crisis control model they did what they
felt was right in the moment and complied with cultural differences along the way. The
sincerity of the apologies was questions by some of the public because of the way they
defended the company, which was off putting (Knoespek, 2011). Instead of telling the
public the positive past about the company they should have sincerely apologized,
confronted to issues then address their previous accomplishment to rebuild that
reputation.
Through SMART research (Swift Market Analysis and Research Teams) Toyota
investigated consumer complaints and created advertisements that answered real
customer questions. They turned to digital and social media to reach more customers
and receive related questions about the recall, vehicles and future of the company. This
method targeted a younger audience of involvement but answered the questions that
customers of all demographics would have (Christians, 2015).
Although Toyota started off in a negative light with the public they slowly figured
out the best methods to involve the public and connect through these campaigns,
advertisements and research methods.

Toyota Objectives
The aftermath of this crisis left the Toyota Motor Corporation in a state of
desperation, with a significant amount of damages to their brand and reputation. Toyota
wanted to reassure customers that their products were of the highest quality, formulate
more efficient communication systems between the United States and overseas offices,
and become more transparent and honest with their customers. At this point in time,
Toyota established several objectives that needed to be achieved in order to rebuild
their corporation. These objectives can be categorized into three groups: awareness,
acceptance, and action.
Upon initial reports of safety issues with their cars, Toyota did not properly
respond and were not aware of how the public felt towards their corporation. From
making assumptions to jumping to conclusions about the cause of the safety defects,
Toyota did not provide clear answers to consumer questions. Ira Kalb, an auto industry
expert stated, “Jim Lentz, president and chief executive officer of Toyota Motor Sales,
USA, went on the Today Show and looked like a ‘deer in the headlights’ in response to
Matt Lauer’s cross-examination”. Americans throughout the nation negatively
responded to Lentz’s television appearance; in a poll conducted prior to his appearance
on the Today Show, “37% of the [population] said they were less likely to buy Toyota
cars. The negative numbers jumped to 56% after he spoke” (Kalb 2012). Americans felt
that Toyota’s response, or lack thereof, in this situation significantly affected the
corporation’s credibility. People did not know where to look for insight, and did not know
what to believe since there were so many diverse responses.

An additional instance that led Americans to be doubtful of the corporation was
the unprofessional communication between Toyota’s American and Japanese public
relations practitioners. Overall, Toyota was stagnant in acknowledging the situation,
which led consumers to assume Toyota was disguising their discretions. The initial
accident that led to the death of a consumer occurred on August 28th, 2009, and
throughout the year leading into 2010 about 8.1 million vehicles had been recalled.
From the beginning, Toyota should have began investigating the defects in their
vehicles to inform themselves of what was occurring, how to correct it, and what proof
they had so far. By neglecting to do this, people became unsure of Toyota, a brand that
was so well known for its quality vehicles and services, which negatively impacted the
publics’ perceptions of the brand. A suggested awareness objective for the Toyota
corporation is to be upfront, honest, and transparent when it comes to crisis situations,
whether it be through a press release, press conference, social media etc. They need to
become increasingly aware of how situations like this take a toll on not only their sales,
but more specifically their brand’s reputation.
By the same token, Japanese chief executive officer, Akio Toyoda, did not
formally speak about the situation until February 5, 2010. This can be attributed to the
differences in cultural communication between Toyota’s American and Japanese public
relations practitioners. Typically, Americans expect the CEO of a company to formally
acknowledge a crisis situation. However, in Japan, CEOs bow as their form of an
apology. The deepness of the bow represents the severity of the apology. The cultural
divide between Americans and Japanese led Toyota’s public relations practitioners to
dispute over what the best course of action for handling the crisis was. Unfortunately,
this ended up worsening the situation by adding unnecessary conflict and delaying the
delivery of a proper response (Nichols 2011).
A suggested acceptance objective for Toyota is to develop a more open
relationship with their overseas offices. Meetings between the American and Japanese
could take place every three months to communicate cultural norms, business
practices, and brand perceptions in their countries. This would establish a better
connection between the countries by enabling Toyota executives and public relations
practitioners to interact, and create a firmer crisis communication plan, tailored
specifically to the people of their countries. These meetings could alternate being held
in Japan and America, giving each country the opportunity to physically experience the
diverse cultures. Moreover, this shows Toyota’s acceptance and understanding of each
other’s cultures and increases global diversity.
Another acceptance issue for Toyota following the recall crisis was further
investigating the safety defects. In order to begin exploring safety hazards, the National
Highway Transportation Authority (NHTSA) intervened. NHTSA is the government body
in charge of regulating automobile safety. To increase the accuracy of the investigation,
NHTSA partnered with NASA to study the electronics of Toyota cars that were identified
as the cause of the defects. Jeffrey Liker of the Harvard Business Review stated,
“The only causes NASA found were improperly installed floor mats and sticky
gas pedals that can be slow to return. There has been only one documented
accident caused by the floor mats[…]and there have been no documented cases
of accidents caused by the very small number of sticky pedals. Most accidents
have been attributed to driver error. We also learned that the NHTSA knew all
along that the only problems were floor mats and sticky pedals, but they had to
go head with the NASA study to convince members of Congress who believed
electronic were the cause of sudden acceleration despite a total lack of evidence
to support that belief” (Liker, 2011).
Essentially, this investigation was conducted for the mere purpose of the NHTSA
being able to prove that they made the correct assumption from the beginning of the
crisis. Despite millions of dollars being spent on the NASA study, the NHTSA was able
to prove that electronically there were no apparent issues with Toyota’s vehicles. A
suggested acceptance objective could have been to communicate more efficiently with
their key publics and target audience the fact that there was no evidence of electronic
safety defects with their cars. This could have provided the factual verification that
Toyota needed to reassert and establish their brand as a quality carmaker. If this was
conducted in a more timely fashion, and if the information was published earlier on,
Toyota’s reputation and credibility would not have suffered as greatly as it did. The
distribution of this information could have occurred very simply through a press release,
press conference, and on social media platforms as well.
Taking Action
Correspondingly, following the recall crisis, Toyota had a variety of action
objectives to be achieved as well. One of the main actions Toyota wanted to accomplish
was improving the production and development of their cars, ensuring that high quality
was maintained.
As previously mentioned, this recall crisis caused consumers to question the
quality of Toyota cars. Between 2008 and 2010, Toyota rapidly expanded both in Japan
and America, which lead to delegating increased amounts of work to employees. This
negatively impacted the company because their employees were being spread too thin
and were unable to keep up with the increased demands. At this point, Toyota
outsourced engineers who were not as well trained and informed about the high quality
of Toyota cars. Business expert Robert E. Cole discussed how, Japanese researcher,
Takahiro Fujimoto believes that this contributed to manufacturing errors. He said, “In the
wake of rapid growth, Toyota increasingly failed to properly evaluate and approve
components designed by outside overseas suppliers. As a result, Toyota’s relationships
with suppliers became less collaborative […] (Cole, 2011). A suggested action objective
based on this information would have been for Toyota to hire specially qualified
employees, and provide them with sufficient training to enable them to produce the best
Toyota cars. Completing this action would have exemplified Toyota’s efforts to improve
the quality of their cars.
An additional action objective for Toyota was to, “Focus more on emerging
markets for new growth, aiming for 50 percent of its sales from those nations, up from
the current 40 percent” (Kageyama, 2011). Toyota identified North America as the
region that they wanted to increase their sales in the most. Aiming to this target, Toyota
increasingly began to promote their hybrid vehicles. In fact,
“They [Toyota] announced two new, bigger versions of its hit Prius hybrid-station
wagons that are set to go on sale in Japan next month. The five-seater version
will also go on sale in North America later this year. The seven-seater, packed
with a new lithium-ion battery, will go on sale in Europe as well next year”
(Kageyama, 2011).
By taking this action, Toyota made strides to increase their sales after they had
plummeted following the recall crisis.
Lastly, another action objective Toyota should have taken was producing an
advertisement during this time proclaiming that this would have been an ideal time to
purchase a Toyota. This could have been supported with evidence from the NASA
investigation, which would make Toyota more credible. They also could have included a
prolonged warranty to reassure customers that if any issues were to occur, that they
would be taken care of.
Communication Strategies
In response to this recall crisis, Toyota incorporated several campaigns to
achieve their objectives. James T. Berger of the Wiglaf Journal stated, “Toyota clearly
belongs in the team pictures of the worst of failures-and will pay dearly in the end.
However, making the mistake is not the biggest problem; it is how the crisis is managed
that transcends the crisis and transforms a mere crisis into a marketing disaster”
(Berger, 2010). In this case, how the crisis was managed did in fact turn the situation
into a marketing disaster.
After recalling about 8.5 million cars, Toyota’s CEO Akio Toyoda was not
prepared to acknowledge the public. Toyoda neglected his responsibilities as a leader
and even went into hiding. This left Toyota’s American CEO, Jim Lentz to speak on
behalf of the entire company by himself. Toyoda neglected the media and also
continued to allow Toyota’s quality issues reach an unattainable level. Additionally,
disputes over who would respond to the crisis delayed a formal apology and
acknowledgment even further. As mentioned in the previous section, the initial accident
that sparked this crisis occurred in August of 2009, and a formal response was not
made until February 5, 2010. In relation to the awareness objective of becoming more
transparent, this proved to be an ineffective strategy of handling interpersonal
communication. Their stagnant response led publics to believe that they were hiding
something, and consumers no longer felt aware of what exactly was going on with the
Toyota brand and corporation as a whole.
Despite the ineffectiveness of this strategy, Toyota launched a new slogan for
their brand which was, ”Let’s Go Places.” Toyota’s Division general manager said, “It is
energetic, aspirational, inclusive and very versatile. The phrase conveys a dual meaning
of physically going places and taking off on an adventure, while also expressing
optimism and the promise of exciting innovation that enriches people's lives (Advertising
Age, 2012). Directly correlated with suggested awareness, acceptance and action
objectives, this was an extremely successful form of interpersonal communication that
invited consumers to “go places” with the brand. Also, this really appealed to people’s
emotions by giving them hope for the corporation, and putting them at ease knowing
Toyota was moving forward with strides back to what their brand used to be. This
tagline was communicated verbally and non-verbally through television commercials,
print advertisements, digital advertisements, through social media and many more as
well. We believe this was an effective form of both verbal and non-verbal interpersonal
communication, and really assisted the brand in clearing their name.

Another effective strategy executed by Toyoda is that upon announcing the new
line of vehicles Toyota was releasing, Toyoda made the announcement written in
English. Prior to the crisis, Toyoda would have released messages in Japanese, his
native tongue, but he did this as a way to appeal to the global population. He also
verbally communicated in English during a press conference about the new releases,
and referred to it as the world’s international language. This was an extremely
successful strategy on Toyoda’s behalf, and increased his credibility, or ethos, and
awareness of Toyota’s multicultural relationship (Kageyama, 2011).
We agree with this strategy because throughout the crisis situation, Toyoda was
depicted in a negative light and was deemed to be afraid and unaware. The decision for
Toyoda to speak in English was an excellent example of good news media relations,
and correlated with the acceptance objective of Toyota developing a well-established
relationship with their overseas offices. Furthermore, this gave Toyoda the opportunity
to exemplify that he does care about Toyota and is eager to further incorporate
improved cross-cultural communication.

Lastly, a successful form of verbal communication, both interpersonal and
organizational was that throughout the crisis, Toyota did not fire or layoff any of their
employees. David K. Hurst of the Harvard Business Review said,
“Toyota, which famously treats its people as appreciating assets rather than
variable costs, did not lay off any permanent employees, as many of its
competitors did; neither did it bully its suppliers. Instead, the firm reduced work
hours and instituted temporary pay cuts. It also seized the opportunity to work on
projects aimed at improving flexibility, such as reducing the breakeven point of its
plants from 80 percent capacity to nearly 70 percent-a huge challenge for a
company already noted for running lean” (Hurst, 2011).
This directly correlated with acceptance and action objectives of improving their brand’s
image, and also appeals to the emotions of people who may have been fired or laid off
when their employer was experiencing a difficult time. This was considered successful
because it depicted Toyota as a family, and showed that through good times and bad,
the company and its employees remain together. Furthermore, this exemplified unity
and also increased the company’s credibility by showing good corporate structure.
Throughout this entire recall crisis, and the events that took place as a result
Toyota’s key message became evident: Although the corporation experienced a great
deal of setbacks and negativity, they continuously stuck by their brand reputation of
producing high quality, affordable cars. Whether through news media relations, social
media, and interpersonal communication within the company and their publics, Toyota
wanted everyone to understand the same message.

Although it may have been communicated differently based on the target audience, the
message remained the same, further proclaiming that Toyota is a world-renowned
quality carmaker.
Evaluations
Due to the wide array of recommended objectives, there is multiple research
methods that could be used to evaluate their successes or failures. Three questions to
assist in measuring the achievements of suggested objectives are: How far have we
come since the initial defect in 2009? Have our sales increased or decreased
after the crisis? What can we do to prevent another crisis like this? These questions will
be answered in the following sections.
In order to evaluate the success or failure of Toyota’s public relations campaigns,
we suggest conducting several focus group interviews. This should include consumers
who are and are not Toyota customers. Since this was such a well known crisis
situation, it is crucial to include non-Toyota consumers in order to get a better sense of
how the general public viewed the corporation. We believe this would be the most
efficient way to listen to feedback and consumer insights on what they like or dislike
about the brand, and how it could be improved in the future. This is a critical aspect of
evaluation because consumer feedback can lead to the development of ideas directly
based on customer wants, that could prove to be extremely beneficial in the future.
Specific questions to be asked could be: After the recall, how likely are you to purchase
a Toyota, why or why not? Do you feel that our efforts to increase our brand’s quality
have been effective, why or why not? What do you like the most/least about our brand
and why?
Asking these types of open-ended questions lead to more detailed responses that
would have actual substance and suggestions, as opposed to simple yes or no
questions.
Additionally, another way to evaluate perceptions of the Toyota brand would be
to conduct an online survey asking the question: How likely are you to purchase a
Toyota? Options for answers could include: Very likely, pretty likely, somewhat likely, or
not likely at all. There could also be a space for consumers to add comments explaining
whatever selection they chose. Prior to beginning the survey, consumers would be
prompted to enter demographic information such as income, gender, geographical
location and whether they are or are not a current Toyota customer. This online poll
could be posted in email messages, social media posts, and on the company’s website.
Conducting this type of survey enables Toyota to analyze percentages of the
population, and to better understand how customer demographics play a part in what
type of automobile they purchase.
The last suggested evaluation method would be simply to analyze Toyota sales
from year to year. An increase or decrease in numbers is a blatant fact that depicts
whether Toyota is successful or not. According to the Business Strategy Group, “Since
the recall, Toyota has regained its position as the world’s best selling car manufacturer,
becoming the first to sell 10 million vehicles within a 12-month period” (Business
Strategy Group, 2013). Based on this information it is evident that Toyota has indeed
recovered from the 2010 recall crisis.

Overall, Toyota has been successful in rebuilding their reputation since the recall
crisis. Hurst stated,
“Today, the story has almost disappeared from the news, and the authors
contend that Toyota’s reputation and market position have largely recovered.
They say that the company survived both the recession and the recall because of
the strengths of its entire ecosystem, suppliers, dealers, employees, and culture.
Toyota executives made a number of changes to bridge the gaps between the
center and the regions, and overall, their actions seem to have reassured both
employees and customers. So in the end, this is a story of how the good guys
suffered a setback, but ended up better for the experience [...]” (Hurst, 2011).
Despite previous flaws in their operations, Toyota has made serious efforts to
return their brand and vehicles back to its level of high quality. Based on Hurst’s
message, it is evident that Toyota has been successful in doing so since 2010, and that
the corporation is continuously striving to avoid a similar situation in the future.
Conclusion
In conclusion, Toyota has learned a lot about themselves and their consumers
from this incident. Some of their biggest oversights included CEO Akio Toyoda going
into hiding upon hearing about the initial safety defects, not hastily acknowledging and
responding to the situation, faulty internal company structure, and lack of a firm crisis
communication plan readily available.
Through their different campaigns and actions, such as the “Let’s Go Places” and
Toyoda making announcements in English, Toyota really marketed to their target
audiences on the world’s stage. These specific actions cater directly to almost all of
Toyota’s target audiences, both in America and Japan. Both actions affect both
populations equally, and by making themselves appear culturally conscious and
evolutionary, they have locked in their target audiences for many years to come. These
established connections could be continued through future endeavors such as Toyoda
visiting Toyota in America, and American CEO Lentz visiting Toyota in Japan. This
would show continuous efforts made to be culturally conscious and aware as leaders of
the company. As for the “Let’s Go Places” campaign, Toyota could hold a contest
potentially called “Let’s See Where You Go” where consumers could post videos
documenting trips they have taken in their Toyota. The person with the most interesting
video could win a brand new Toyota car. Not only would this drive consumers to want to
use or purchase a Toyota, but it also exemplifies that Toyotas are durable cars that are
made to last wherever the road may take you.
As a whole, this crisis served as a beneficial learning experience for the
company. This led them to reevaluate management and leadership structure within the
company, led to the emergence of Toyoda as a better, stronger leader, led to better
cross-cultural communication between Toyota in Japan and America, led to new
taglines and promotions, and enabled the company to realize flaws in their quality and
production. Specifically, this provided Toyota with the perfect opportunity to step back
and thoroughly assess their operations and procedures of both their management and
car production systems.

Appendix
1. Toyota STAR safety system
http://www.toyota.com/usa/safety/
2.
www.blog.hemmings.com
3. & 4.
http://toyotanews.pressroom.toyota.com/article_display.cfm?article_id=2852
.
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Toyota 2009-2010 Recall Case Study

Effects of the Recall___________________________________________________8

Cross- Culture Complications________________________________________9

Toyota’s Target Market________________________________________________15

Evaluation of Target Market________________________________________16

with the public and restore the brand.

method of communication because of the cultural differences between Japanese and

releasing to the public.

mission of safety and customer satisfaction.

million in the United States (Quelch et al, 2010).

The Department of Transportation and the National Highway Transportation

the company as dishonest and untrustworthy.

coverage in newspapers, blogs, forums and television news, which presented a

Below is a chronological timeline of Toyota recalls from the Guardian Newspaper in

17 February: Toyota announces it will install a brake-override system in all future

19 February: Akio Toyoda bows to US pressure and agrees to appear before a

Toyota is a Japanese automotive manufacturer, founded in 1937 by Kiichiro

world by revenue and is made up of over 330,000 employees worldwide (America’s

Their philosophy of Kaizen, meaning

continuous improvement, is found in their

production, employees, business models

and is the heart of the company

The Effects of the Recall

According to Akio Toyoda, Toyota’s President, the company’s traditional priorities

Below is the list of affected vehicles according to the Dickinson Press.

Avalon: 2005-2010 Corolla: 2009-2010 Camry: 2007-2010 Highlander: 2010

Sequoia: 2008-2010 Matrix: 2009-2010 RAV4: 2009-2010 Tundra: 2007-2010

Tacoma: 2005-2010 VENZA: 2009-2010 (Call, 2010)

Timeline of,” 2010).

as much as we were able to before (Testimony to House).”

Cross- Culture Complications

confusion and serious backlash the public.

When a company is responsible for a crisis in American business the public

he follow Japanese business culture of making a decision through quiet conversations

between employees and company leaders (Reid, 1999).

they were brought into a dealership. Scott Ehrlich of Ehrlich Motors, a

Colorado. Our dealership is not aware of any (Dunn, 2010)."

beyond (Dunn, 2010)."

company’s brand image and communication methods. They released an advertising

because of a perception of Toyota safety (Retchin,

Carter said the theme of safety for Toyota will

be a long-term advertisement campaign for the

brand until the customer’s perception of the brand

change and become trustworthy again. "If you look

at various attributes of cars -- performance,

handling, value -- those are set like a volume knob

[on a stereo] by consumers," Mr. Carter said in an

interview. "But safety, that's a light switch.

Either you have it or you don't (Retchin,

The advertisements featured in the

new Star Safety System (See Appendix 1)

included VSC: Vehicle Stability Control,

TRAC: Traction Control, ABS: Antilock

Braking System, EBD: Electronic Brake-force

Distribution, BA: Brake Assist and SST:

Smart Stop Technology.

According to Toyota’s public statement,

This integration of active safety features is designed to protect occupants by

with friends or family (Toyota STAR).”

An example of the campaigns television advertisements is a story of a mother

who believe safety is the most important factor of a vehicle.

they have had many good years of safe products.

Toyota responded to the incident.