Toyota CEO cites race to pass GM as problem

Toyota President Akio Toyoda conceded Wednesday his company’s race to surpass General Motors as the world’s biggest carmaker “may have been too quick” and helped produce the slew of recalls and revelations that have dealt a serious blow to the firm’s reputation for safety and quality.

In an extraordinary command performance before a packed congressional hearing, Mr. Toyoda, grandson of the company’s founder, acknowledged that Toyota’s management “pursued growth over the speed at which we were able to develop our people and organization.”

The hearing by the House Oversight and Government Reform Committee, which also included testimony from Transportation Secretary Ray LaHood, was the second of three congressional panels looking into Toyota’s safety problems.

Mr. Toyoda apologized personally for recent safety problems and accidents related to Toyota-made cars, saying at one point, “For me, when the cars are damaged, it is as though I am as well.”

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But for some lawmakers, the mea culpa was not enough.

Committee Chairman Edolphus Towns, New York Democrat, charged that there was “striking evidence that the company was at times more concerned with profit than customer safety.” He cited an internal Toyota document boasting about saving the company $100 million by limiting the scope of a recall sought by U.S. transportation safety officials when reports of braking and acceleration problems first surfaced.

Joan Claybrook, who headed the National Highway Traffic Safety Administration (NHTSA) from 1977 to 1981, agreed. “Toyota may be interested in trading dollars for lives, despite the likelihood of its products causing deaths and injuries, but its customers aren’t,” she said in her testimony.

Toyota Motor North America President Yoshimi Inaba, who testified beside Mr. Toyoda, dismissed the internal document as “orientation material” for him when he arrived last year to take his new post. But he added the document was “inconsistent” with the guiding principles of Toyota.

Mr. Inaba announced at the hearing that Toyota would offer free at-home pickup for all its recalled vehicles; provide free rentals while repairs were being made; and reimburse customers for their out-of-pocket transportation expenses.

The personal appearance by a top foreign CEO is highly unusual on Capitol Hill, and illustrated the scope of the public relations nightmare that has engulfed what had been one of the world’s most admired companies.

Mr. LaHood told lawmakers that Mr. Toyoda’s appearance proved the company was no longer “safety-deaf” to overseas complaints.

“His visit here has been a game-changer,” Mr. LaHood said.

Mr. Toyoda’s testimony followed reports that Japanese officials are investigating 134 complaints about “sudden unintended acceleration,” including 28 involving Toyota vehicles.

Toyota’s safety troubles have resulted in the global recall of 8.5 million vehicles since last fall, including more than 6 million in the United States. More than 30 deaths since 2000 have been attributed to acceleration problems in Toyota and Lexus vehicles, according to complaints filed with the NHTSA.

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