Toyota Recall Crisis: Strategic Intelligence and Possible Solutions

INDIVIDUAL REPORT ASSESSMENT &
MARKING GUIDELINES

EXECUTIVE SUMMARY
Worldwide, Toyota Motors Corporation is seen as one of the largest automakers, but in the
mid of 2010, reputation of company was affected by recalling millions of cars after the
problems occur from the means of break, floor mats and acceleration pedals issues of the
cars. By considering this aspect, the present study aims to evaluate specific business issue
faced by Toyota by considering their possible solutions. Study shows that this issue had
significantly affected the overall image of the company. Further, to cope up with this,
company is required to comply with the recommended strategies.

TABLE OF CONTENTS
Introduction................................................................................................................................1
Strategic intelligence: Case study of Toyota..............................................................................1
Overview and fact on the recall crisis....................................................................................1
The issue of recall in different countries................................................................................2
Impact of the recall crisis.......................................................................................................2
Initiatives were taken by Toyota to overcome the recall crisis issue.....................................3
Reasons for recalling manufactured cars...............................................................................4
Conclusion..................................................................................................................................5
Recommendations......................................................................................................................5
References..................................................................................................................................8

INTRODUCTION
Toyota, a Japan-based automobile manufacturer and selling company are well known for it's
in brand name and quality in the automobile industry. At present, the company is facing
significant issues because of its speeding issues, and same is putting the lives of drivers at
threat (Camuffo and Wilhelm, 2016). Moreover, such recalls stopped the progress of the
company and direct Toyota towards the stoppage of sales and on the manufacturing of its
eight popular models. By considering this aspect, the present report aims at critically
analysing the specific business issue faced by Toyota, i.e. recall crises while clarifying
various aspects of strategic intelligence. The possible resolution of such issue is also quoted
at the end of the report.
STRATEGIC INTELLIGENCE: CASE STUDY OF TOYOTA
Overview and fact on the recall crisis
In the present era, Toyota is one of the largest automobile industry in terms of selling high-
quality products and creating modern and innovative products in the supply chain and in the
production process of the company. Therefore, the approach of Toyota is only winning
towards the supply chain management and manufacturing to another company; it includes
automotive industry to follow the philosophical and operational approaches towards
manufacturing and others in various types of industries (Greto, Schotter and Teagarden,
2010). Nevertheless, from the past few years, the company faces so many issues related to the
quality of the product, and in some incidents, it shows as results in a mass product recall. In
2010, the worst incident was at that time when the company ought to recall its 8.5 million
vehicles at a worldwide level; some major issues are causing for the company from damaging
the brand and PR perspective (Campbell, 2017).
By now, Toyota Company is affected by the recalls, and that is the major reason why
business profitability gets influenced. For example, On February 2, the corporation has built a
state in which a 16% decline in sales is reported which is 10-year low of 98,796 vehicles.
Furthermore, simultaneously, sales of General Motors’ increased by 14% and of Ford’s were
up 25% (Wharton, 2018).
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