The latest Toyota Prius recall reflects a changing attitude in the auto industry. In this latest recall, 1.9 million Priuses are being brought back to dealerships for a software upgrade. It has been found that a potential programming error could shut down their gas-electric engines.
New technology invites manufacturers to walk a fine line. In their rush to “one-up” their competition, many manufacturers employ technologies that are far from proven. It is a double edged sword that can offer great rewards in a successful introduction, or great losses in one that backfires. The potential for success, equate that to financial gain, or failure, loss, is dependent on real world conditions that quite often are not reflected in “official testing” procedures. As hard as manufacturers try to reproduce foreseeable circumstances, it is impossible to reproduce every scenario faithfully.
In the age of social media, where news can be transmitted instantly, and very effectively, the Toyota Prius recall marks a fundamental shift in corporate policy. Gone are the days of silence and stoic stubbornness, when a manufacturer crunched numbers and turned the other cheek, like the “unintended acceleration” debacle involving the same manufacturer in 2009 and 2010. Scenarios like that have been played out repeatedly in the past, by many manufacturers, but in today’s social media obsessed world, public relations have taken on a newer, more powerful role. Potential negative collateral damage from a “look the other way” approach, now far outweighs any short term gains to the bottom line by ignoring the problem.
A problem which, ironically, has been compounded by the level, and speed of introduction, of new technology. There are always teething problems connected to new technology, all industries are the same. A product with new features offers a new incentive to buy, but it also offers increased risk of failure. What happens when the latter beckons.
Ford Motor Company was quick to introduce its new EcoBoost engines to its Escape models in 2012. By all accounts it is a sweet motor, but the 1.6-liter versions were catching fire. Obviously cars that catch fire cannot continue to be sold, but it is how Ford dealt with the problem that is telling. Ford traced the problem, found a fix, and put it right. Few questions asked. Perception and credibility are now factors that manufacturers pay attention to more than ever. Responsibility is now falling where it should, with the manufacturers, and when problems are revealing themselves they are being acknowledged and dealt with, immediately.
The latest Toyota Prius recall is definite proof of the new philosophy. To recall the Priuses, not just some, but all 1.9 million latest generation Priuses sold, is a reflection of a changing attitude, especially since no reports of injuries or accidents relating to the software glitch have been made. If that is the case, Toyota is making a preemptive strike which will have a double impact. First, it will correct the problem. Secondly, it will illustrate that Toyota is serious about quality control and reputation. The actions create a feeling of assurance.
It is also noteworthy that stock in Toyota didn’t take a hit from news of the recall. That fact offers further evidence that the new order of car manufacturing builds in the possibility of recall cycles. The new mindset would appear to be, as long as recalls are dealt with transparently and expeditiously, then there is no cause for concern.
So, who wins? Short answer, the buyer. Yes, it is inconvenient to drive to the dealership and arrange for “work” to be done on a new vehicle. But that work is coming on the heels of technology that offers the driver so much more than was offered even five short years ago. For the first time in automotive history a buyer can take advantage of incredible competitive technological leaps, while resting assured that if those same leaps go sideways, the manufacturer will put them right, on their dime. There is no doubt the Toyota Prius recall is significant, not just because of the numbers involved, but because of the changing attitude it reflects in the industry.
Editorial by Scott Wilson