Toyota Finally Listened… but the Credit Accrues to their Lexus Brand

Today, the Lexus suspended sales of the GX 460 because a Consumer Reports issued a “Don’t Buy” warning due to rollovers in their testing. Toyota is finally listening, but consumers may give the credit to the Lexus brand, and not the parent brand – Toyota.

Without debating the warning, Toyota said they will “…take the Consumers Reports’ test seriously.” They are finally learning that denial doesn’t earn respect from consumers, and also signals that something is suspicious. In fact, what they are learning is that transparency and open communications with consumers is today’s mandatory to protecting a brand. Whatever the outcome of Toyota’s tests attempting to replicate the rollover problem, consumers will cut Lexus a break. Why… because it is the right thing to do.

Instead of being recalcitrant, Toyota is putting the consumer first. By doing so, they actually build a stronger relationship, generate greater loyalty, and secure their franchise for years to come.

In an earlier post (“Toyota… Another Nail in the Brand Coffin “), we discussed how Toyota’s behavior was hurting that brand, which it certainly has. In the case of the sticky accelerator pedals in Toyota cars, and the enormous media attention and consumer concern, their business has felt the impact and will for some time to come. In January and February, car sales were off 16% and 9% respectively, but have rebounded in March due to unprecedented price incentives to keep the business alive. They cannot keep throwing money at consumers over the long term.

All Toyota had to do was; a) communicate that they took the issue seriously, b) appoint a safety czar beyond reproach, c) communicate every day progress made towards solving the perceived issue, and d) make all their actions open and not secret. If the marketplace felt that they were acting in its interest, it would have been far more forgiving.

The Lexus reaction indicates that an old dog can learn new tricks. However, it will be up to the media and consumers to make the link between Lexus and Toyota. For now, most will probably perceive that Lexus acted correctly, and not necessarily accrue the new behavior to Toyota. This presents and interesting PR challenge for Toyota.

Perhaps this will be a lesson for other large corporations to revisit their brand policies on transparency and acting in their customers best interests. That would be a good thing.