WHEN Toyota Motor Corp was on the brink of overtaking General Motors as the world's biggest automaker in 2008, executives were busy sending out warning signals about the dangers of being No.1. Toyota is now witnessing the realization of those fears, caught in a mushrooming recall debacle affecting as many as eight million cars – a development many say underscores the difficulty of maintaining top-notch quality in a hasty expansion. It may also be the manifestation of the “big-company disease” that Toyota President Akio Toyoda has vowed to quash since taking the helm last June, aiming to restore the company's solid foundation that he said was lost during a decade of rapid global growth. Toyoda has not commented publicly on the faulty accelerators and floor mats since expressing regret for the deaths of four people in a crash linked to the problems in August last year. “Toyota is the new GM in terms of experiencing quality glitches, over-expansion and the proliferation of new product models,” said Dennis Virag, president of Automotive Consulting Group. “Toyota has been too aggressive and perhaps complacent in terms of focus on quality. They can't concentrate on the details with so many models.” Toyota, Japan's largest company with a market capitalization of around $141 billion, produces dozens of models around the world and has more than 500 subsidiary companies. Toyoda, who warned last year that his company faced the prospect of “capitulation to irrelevance or death”, citing a five-phase road to demise outlined by business scholar Jim Collins, has his work cut out for him. The reason? Toyota's recent quality woes are not new. As vehicle recalls mounted to more than a million a year, then-president Katsuaki Watanabe in 2006 assigned two executive vice presidents to oversee quality improvements. One was tasked specifically to work closely with suppliers to catch design defects early. The current recalls in North America and Europe involve accelerator pedals produced by CTS Corp. Two years later, in 2008, Watanabe had said those efforts had borne fruit, and that recall cases had fallen dramatically. Indeed, the “back-to-basics” goal was one that Watanabe had promptly pledged when he took office as far back as 2003. The latest recall, of unprecedented scale, throws the efforts back to square one. Toyoda, the grandson of Toyota's founder, has outlined broad steps aimed at returning the company to profit and speed up decision-making, but has yet to announce new plans to improve quality checks. The level of attention on Toyota's woes –from consumer groups, media and the government –is also the manifestation of another major fear that Toyota has harboured: that public opinion could be unkind to those at the top.
