Amid the recall crisis it seems strange to report that Toyota posted a profit in the last quarter of 2009. Analysts, for their part, aren't impressed. Toyota's brand has been on a long slide, with investigations into a "fatal floor mat" wounding the brand even before the company suspended sales of eight popular models. Even the prized Prius is now under scrutiny, with Apple whiz Steve Wozniak alleging his Prius has frightening software problems. With all that, are auto-watchers supposed
to cheer as the company raises profit predictions? Apparently not.
- Drop in the Bucket Toyota may have reported a profit today, writes Daily Finance's David Schepp, but it will "likely spend the day and weeks to come explaining how it intends to repair the antilock braking system on thousands of newly redesigned Prius models that came on the market in May."
- Don't Get Too Excited Officials also "raised [their] outlook for the current year," notes 24/7 Wall St.'s Douglas McIntyre, but "if sales are drastically affected by safety concerns, that forecast is almost certainly too optimistic."
- Massive Problems at Toyota At BusinessWeek, David Welch says winning back customers "will be tough." The recalls affected some of the brand's most popular models, and "while vehicle recalls are fairly common, those of this magnitude and seriousness tend to stick in consumers' minds." But worse is that "Toyota's handling of the biggest crisis in its history has at times seemed inept and plodding."
- Competitors Taking Advantage Taking shots from comedians--as they are beginning to do--"certainly won't make lives easy at Toyota," writes Paul Eisenstein for The Daily Beast, "but the real question is whether the Big Three, who have had plenty of problems of their own, can take advantage of the situation." Recent indicators are that they can, GM highlighting elements of its "dependability study" while, to Eisenstein, Ford's commercials look like they're beginning to shift towards "product attributes."
- Time for a Change, declares the Atlantic's Megan McArdle. "The US is a huge market, and they just did brutal damage to their brand on one of their two or three biggest selling points." To give customers the assurance that it will never happen again, McArdle suggests a "management shakeup," possibly giving engineers more control of the company.