The initial headlines out of Japan this morning are sure to ruffle feathers on Capitol Hill. Toyota President Akio Toyoda told reporters that he is not planning to appear at congressional hearingsin Washington, D.C.
Mr. Toyoda also made it clear he will re-consider his plan and may appear at hearings if he is invited to do so. But as of now, he believes the company's U.S. based executives are the best people to answer questions about the Toyota recalls, the company's repair plan, and how whether the company moved fast enough.
On the surface, Mr. Toyoda's plan seems logical. But logic doesn't always matter in Washington. What matters are appearances. And right now, there are members in Congress who want to give the impression they are getting answers from Toyota's top guy. This is why I fully expect members of congress to push Mr. Toyoda to show up. And if he is planning to be in the U.S. around the time of the hearings, he should comply with their request.
Let's be clear, the most important information to come out of these congressional inquiries will be the documents showing what Toyota knew, when it knew it, and whether it moved quick enough to alert the public and recall potentially dangerous vehicles. That's why the NHTSA investigation into Toyota's recalls is so important. That probe, announced yesterday, will shed light on whether Toyota simply dropped the ball about safety concerns or was trying to keep this problem from blowing up publicly.
Now that Congress is digging into the safety issues at Toyota, the company finds itself having to do what the big 3 did in late 2008, go to Capitol Hill and explain itself. I'll be curious if Toyota learns not to make the same mistakes the CEO's of GM, Ford, and Chrysler made during their hearings. They came off as aloof and out of touch with reality.
Mr. Toyoda and the Toyota executives in Japan may have been way too slow to react to public complaints when the safety concerns first came up, but in the last week and a half the company has stepped up its efforts. Mr. Toyoda is holding press conferences answering reporter questions, and the company is increasing marketing plans to show it is sorry for this entire mess.
But with these Congressional hearings, the public scrutiny will be even greater. Yes, Mr.. Toyoda's top lieutenant in the U.S., Yoshi Inaba, is better positioned to answer questions than Mr. Toyoda. But, in this case, with these hearings, the appearance of complying and doing everything Washington wants will be the key to helping Toyota get past this controversy.
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