Akio Will Show, Toyota Gets its Message in Gear
CNBC Auto and Airline Industry Reporter
The stage is set for Toyota President Akio Toyoda to testify at a Congressional hearing next week.
While the initial thought is Toyoda's appearance will finally be the chance for us to get to the bottom of the safety questions surrounding millions of Toyota cars and trucks, I think you'd be better served to dial back your expectations.
Congressional hearings tend to be more about show than substance, though it's clear some on the House Oversight Committee are trying to break that pattern.
If they are successful, the Toyota hearings next week will be filled with fireworks. If they are not, it will primarily be just a few days filled with lawmakers blasting Toyota and NHTSA.
Which brings up how important Mr. Toyoda's appearance is for Toyota?
For the sake of appearances, it is critical.
As I've said time and again, Congressional hearings involving corporations on the hot seat are about the executives showing humility, contrition and most importantly sincerity. Mr. Toyoda says he plans to offer a "sincere explanation" of Toyota's problems. If he does that, and comes across as genuine, the majority of the negative press about Toyota will start to subside.
But Mr. Toyoda's appearance doesn't mean Toyota is free and clear.
There are still numerous questions about what the company knew, when did it know it, and did it act quickly enough. The paper trail will tell the story here. If it shows Toyota was dragging its feet and "studying" unintended acceleration instead of jumping up and down to catch the problem when it first showed up then Toyota will pay the price. In dollars and cents in the courtroom it will wind up paying tens of millions of dollars. With the American car buyer, it will lose a good chunk of the reputation and good will it built over the last 40 years. That's already happened to an extent. If the Congressional hearings turn up evidence Toyota has not been upfront and straight about unintended acceleration, Toyota will feel more backlashes.
And while Akio Toyoda will get the most attention on Capitol Hill next week, there will also be plenty of tough questions for the National Highway transportation Safety Administration.
What did NHTSA know?
And why didn't it connect the dots of at least six separate investigations into unintended acceleration.
At a minimum there are serious questions about how NHTSA decides to go from investigating a defect to forcing a recall. But beyond that, there need to be more answers about how NHTSA investigates complaints.
Next week will tell us a lot about how Toyota's problems will play out over the next month, and not just because Mr. Toyoda is going to Washington.
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