Toyota/Lexus Still Setting the Pace

The Economist cover reproduced here neatly distils all the recent attacks on Toyota that their leadership position has attracted.  Time to set the record straight.  Toyota has taught the world how to design and manufacture cars and trucks.  Their doctrines of lean inventories and constant improvement, along with corporate humility, have yielded the world’s best cars – maybe not the most exciting, but durable, reliable paragons.

Mercedes-Benz, Porsche and Ferrari have all been greatly influenced by Toyota methods and their cars are better for it.  Toyota has made cars that are better Ferraris than a Ferrari (Lexus LFA), better Buicks than a Buick (Toyota Avalon), better Mercedes than a Mercedes (Lexus LS) and better Jeeps than a Jeep (Toyota Land Cruiser).  They’re in their tenth year with Hybrids and own that market.  They’ve competed successfully in NASCAR, Formula One, World Rally, Offroad and Le Mans 24 Hours.

With GM and Chrysler having both gone bankrupt after telling us for years they were on the brink of a turnaround, it’s interesting to see how Toyota is dealing with gaffes and unprofitable operations.  First, they’re admitting that they have problems.  Unlike GM who constantly claimed they were reinventing themselves, Toyota is reacting with calm focus and deliberate actions.

Mr. Akio Toyoda, grandson of the founder and now the head of Toyota (they changed the spelling from Toyoda to Toyota for the corporate name), has been very candid.  He admits that Toyota expanded too fast and lost sight of their roots.  The result was some embarrassing product shortfalls and recalls.  Toyoda also said that the cars needed more fun and excitement engineered into them.

Economist Front Cover

Forty-five years ago(!) Toyota launched a serious drive for sales in the U.S. with a new car called Toyota Corona.  Two Americans, whose services had previously been rejected by U.S. auto companies, were important to Toyota.  W. Edwards Deming, an American statistician, thought that analyzing and improving design and production processes could eliminate defects, thereby saving money on warranty costs and pleasing customers with defect-free automobiles.  Toyota wholeheartedly embraced his ideas.  David Power, a market researcher, left Ford and set up his own company in Southern California to survey consumers and find out how pleased they were with the product they had purchased.  The first automotive client of J.D. Power, in 1968, was Toyota.  The U.S. companies had rejected Power, saying they already knew what their customers thought. 

Toyota was smart enough to realize they didn’t know everything.  They have used and believed-in J.D. Power customer surveys to this day.  Toyota and Lexus are generally at the top of survey results.  In light of this, I thought we should look at some of the new Toyota and Lexus models.

The 2010 Toyota Camry is the perfect middle-of-the-road family sedan.  For extreme car buffs this is a boring car.  But for most buyers, boring, reliable and versatile adds up to the perfectly satisfactory $20-$25,000 car.

Lexus HS250 Hybrid

Showing that Toyota can execute on their very sophisticated market research, consider the Lexus HS250L Premium.  If you’re too rich or proud to drive a Prius, but you still want to display your enviro-consciousness, this $46,000 anti-car is for you.  A car buff would buy an Audi, BMW or Mercedes-Benz Diesel to achieve similar fuel economy in a seriously good car.  But if you really don’t like cars, but do appreciate fine finishes, beautiful leather, electronic gadgets galore, and a bland driving experience, this is your ride.

Finally, the newest Prius:  It’s everything the Lexus is, minus the super-luxe execution, but with the same level of quality and equal appeal to your green side.

Nissan, Honda, Hyundai, Ford and others have closed in on Toyota’s quality and reliability ratings, creating a new era for car buyers.  You have a 60-70% chance of getting an absolutely zero defect car with many of today’s best models.  And in many others, you can expect one or maybe two minor defects over the first two or three years of ownership.

As evidence of that, our family’s last seven new cars (two Audis, one Porsche, one each of Nissan, Mazda, Suzuki and Subaru) have had an aggregate two minor defects.  Over 200,000 miles, seven cars, two little glitches!!  Thank you, TOYOTA.

Wheels of Change

There’s a new book out, Wheels of Change, by Bay Area author Kevin Nelson, and published in collaboration with the California Historical Society.  Nelson traces the last one hundred years of the automobile and California shaping one another.  He shows how California’s car culture has shaped the world of automobiles.  The racers, designers and engineers in California have caused most of the world’s automakers to establish design centers in Southern California.  The first motel was built in the 1920’s in San Luis Obispo.  Fast food started here.  Drive-thru banks and restaurants originated in California. 
Car buff or not, you’ll enjoy this book, and you’ll understand our state better.  You may even decide that the automobile has been a benefit to society!