Toyota: What would you suggest?

My wife, this morning, sent me this article (http://www.huffingtonpost.com/evan-handler/if-my-car-is-being-recall_b_441370.html) regarding the Toyota Recall for the faulty accelerator pedal. The writer, Evan Handler, compares the Toyota issue to the Tylenol recall in 1982. She asked my opinion. Below is my response to her…

Two days after the guy wrote this article Toyota announced they had a repair and is shipping it out to dealers. They should be able to start fixing cars today or tomorrow. Part of the delay was the government wanted to validate the fix before it could go out.

This has already impacted Toyota. The company has lost more than 18% of its value and estimates have losses in car sales at more than 18,000 per week.

I think the comparison the guy makes with Tylenol is weak. It’s an “apples to oranges” thing. Throwing out a bottle of Tylenol is different from asking someone to give up their car. Even if Toyota did a forced recall of the cars, where would they store them all? How many people would be demanding a rental car while Toyota fixed their car? It would take longer to get everything else in place than it did to find the fix. As soon as dealers get the parts to repair the vehicles it takes about 30 minutes per car. They are funding overtime to allow dealerships to stay open 24/7, if they have to, in order to get the fixes done quickly. The cost factor that the guy brings up is a valid one. In 1982 a bottle of Tylenol cost what… $1.50? These cars cost tens of thousands of dollars. Toyota couldn’t just give people a new car to replace the faulty one.

There could be long-lasting effects of this for Toyota and it is a big deal but, they’re on the right track and working as fast as they can. I think anytime someone is reminded of the actuary tables it pisses them off a little and they get indignant. I agree that a single life is not worth the risk, which is why I will likely never be a CEO where I have to make that kind of decision. I do, however, also understand the financial side of things. Seven people dying from the Tylenol and nineteen from the Toyota likely fell close to the same margin in the tables. It’s sad but true.

I’m trying to be dispassionate about this thing. Like I said, I don’t agree that any life is worth the risk but looking at it from the standpoint of a business; I think Toyota is handling it pretty well.