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U.S. is cast as villain in Japan

Some believe Toyota is being treated unfairly by regulators and lawmakers.

February 27, 2010|By Jerry Hirsch and John M. Glionna

Reporting from Seoul and Los Angeles — A series of aggressive federal probes into the recalls of Toyota autos are looking at whether the automaker has been less than forthcoming about the safety defects in some of its vehicles.

But in Japan many believe it's the U.S. government that has something to hide. Congressional hearings on the recalls, they say, are part of conspiracy to help prop up Toyota's largest American rival, General Motors Co., which the government bailed out of bankruptcy last year, becoming the majority shareholder.

The evidence suggests otherwise, and top Toyota executives have sought to debunk such speculation. Even so, "the conspiracy theory on these Toyota hearings is alive and well in Japan," said Jeffrey Kingston, a professor at Temple University in Japan. "Conspiracy theories don't deal with the facts, but there's a comfort factor among the Japanese public in believing that Japan is being made the scapegoat for U.S. economic problems."

In the case of Toyota, however, the theory that it has been singled out for criticism fails to take into account that U.S. corporations regularly come in for beatings by Congress -- with Wall Street banks being just the most recent examples.

And in granting GM and Chrysler tens of billions of dollars of aid, Congress for years blamed the companies' leaders for poor management and lousy products.

What's more, the National Highway Traffic Safety Administration began investigating reports of unintended acceleration in Toyota vehicles years before the government took its controlling interest in GM and a 10% stake in the post-bankruptcy Chrysler Group. Indeed, NHTSA is now under fire for not acting more quickly and more forcefully in demanding that Toyota take action to address sudden acceleration.

"It's not about politics, it's about safety," said Kurt Bardella, spokesman for Rep. Darrell Issa (R-Vista), the ranking minority on a House committee that organized one of the Capitol Hill hearings this week.

The view that the House Oversight and Government Reform Committee efforts to review Toyota's safety defects and recalls to assist U.S. companies is "idiotic" considering that Issa was an ardent opponent of the automaker bailouts, Bardella said.

Even Toyota's president, Akio Toyoda, and his top U.S. executive rejected the notion when queried during congressional hearings this week.

"I don't believe that's true. I think the government's acting fairly," Jim Lentz, Toyota's top U.S. sales executive, told the House Energy and Commerce subcommittee.

Lentz also apologized for a series of missteps that allowed the sudden-acceleration problem to go unchecked for years, ultimately leading Toyota to issue nearly 10 million recall notices and temporarily halt sales of eight models.

At least 34 deaths have been blamed on sudden acceleration in Toyota vehicles, according to complaints filed with NHTSA, which the agency said is more than all other automakers combined.

Still, to some in Japan, the congressional hearings are reminiscent of the anti-Japanese hysteria of the 1980s, when Japanese investments in high-profile properties such as the Rockefeller Center in New York set off a political firestorm.

One Japanese customer, who bought her fourth Toyota car in June but declined to give her name, said she felt safe driving her Toyota. "I think things are being exaggerated in the U.S.," she said.

Even some Japanese analysts, while acknowledging problems in Toyota's handling of its recall, said they thought Congress has been a bit too opportunistic in its pursuit of a solution.

"It does seem that emotions are a factor at these hearings," said Masahiro Fukuda, manager of Fourin Inc., a research and publishing company specializing in the auto industry.

"Many Japanese see these hearings as an effective way for the U.S. to beat up Toyota and allow General Motors and Chrysler to recover and grab a bigger share of the market," said Koji Endo, an analyst at Advanced Research Japan, an independent research house.

While acknowledging the safety problems that prompted the recalls, some in the United States also wonder whether the passion with which Congress has gone after Toyota during the hearings isn't partially fueled by economic self-interest.

It "can't be ignored," said Mark Zupan, dean of the University of Rochester's School of Business. Zupan said that if lawmakers applied the same standard to all auto companies, the hearings would never end. "This is not an unbiased jury."

Toyota has made things worse by not addressing its problems more aggressively, he said.

On Friday, auto information company Edmunds.com released its analysis of sudden-acceleration complaints to NHTSA and found that while Toyota's rate of complaints was higher than any other automaker, Ford Motor Co. also had a high number.

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