I bought my first Toyota - a 1985 Camry - in 1987. I bought my first brand-new car, a Toyota Corolla, in 1991. All told, between 1987 and 2005, I bought seven cars. Six of them were Toyotas.
I made my non-Toyota purchase, a Ford Windstar, in 1995. I would have liked to get a Toyota, but I needed a minivan, and Toyota’s Previa just wasn’t a competitive offering. I bought two Toyotas in 2000, an Avalon and a Sienna minivan. In 2004 I bought another Avalon, and, in 2005, I bought another Sienna.
That's a lot of cars and a lot of brand loyalty. As for the number of cars, my two daughters were growing up and getting their licenses, so I needed to add to the fleet. And I made those cars Toyotas because I prized the company’s record of reliability and quality.
But when I was in the market for a new car for myself in 2007 — having finally run out of daughters who were going to take my car away — I decided up front not to buy a Toyota-made vehicle, including anything from Lexus. I felt the company's quality was slipping, and I did not like the way the carmaker and some of its dealers were responding to that slippage.
The 2000 Sienna's anti-lock braking system failed at about 70,000 miles, well beyond the 36,000-mile warranty but much too soon for my taste. The replacement part, a brake actuator, cost more than $1,300, and the installation would have been another $700. Toyota was not going to pay for the repair, and a dealer in New York didn’t offer any better solutions. So I took the car to a dealer in Florida, who located a used part and did the entire job for about $900.
Just when I was satisfied that I had resolved the anti-lock brake issue, the car's transmission started making disturbing noises. This time I found out on my own that Toyota recognized a problem with the Sienna transmissions and had a special repair program. But that same New York dealer said my car did not qualify. The Florida dealer said it did. So I brought the car back to Florida to get it fixed.
That same model year of the Sienna had a major problem with engine oil "gelling" and burning out engines. After plenty of customer complaints, Toyota reluctantly issued a special repair offer. Fortunately, my car never had that particular problem.
My 2004 Avalon had some minor but annoying quality control problems, such as a protective molding that peeled off the side of the car. The problems were all fixed under warranty but these were not the kinds of things I expected from a Toyota.
The 2005 Sienna was also faulty. It had a major problem with expensive run-flat tires that repeatedly wore out in less than 12,000 miles. Toyota offered a special one-time adjustment, but the problem persisted for several years until the tire makers finally improved their design.
So I was appalled, but not particularly surprised, when Toyota recently disclosed a critical problem with sticking accelerators that forced it to halt production and sales of some of its most popular models. Approximately 2.3 million vehicles will have to be recalled, according to the carmaker. This announcement came after many months in which the company first denied that there was a problem, and then blamed improperly installed floor mats.
Once it finally focused on the issue, Toyota said within a matter of days that it had developed a fix that is being rushed right now to dealers across America and Europe. Skeptics, including some regulators, are probing whether the fix is well-targeted, or if there is some other issue — perhaps a hardware or software problem with engine-control computers — that may account for some runaway acceleration incidents. Toyota says it has found no such problem in the computers.
In the meantime, the company has suffered another black eye with its abrupt disclosure, after earlier denials, that it is aware of a design problem with the anti-lock brakes in its Prius hybrid vehicles. Toyota quietly changed the design last month, but did not disclose the issue until public reports of Prius braking problems surfaced here and in Japan.
While Toyota says it can repair its cars, it may or may not be able to repair its reputation. Monthly sales fell 16 percent in the wake of the recall, and the company’s stock has sunk $25 billion in value. Some believe that the carmaker may never recover.
I think Toyota will be able to restore its image, but it is going to take a lot of work. For starters, Toyota can no longer get away with a chintzy three-year, 36,000-mile warranty. That kind of deal only works for companies that build cars customers are sure they can count on. Toyota has forfeited its membership in that club. For now, I would rather buy a car from Hyundai, which responded to earlier reliability issues both by improving its vehicles and by offering a 10-year, 100,000-mile warranty.
When my first Toyota was built, the company's slogan was "Oh, What a Feeling!" Right now, I'm feeling relieved that my latest car isn't a Toyota.
Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book,
The High Achiever’s Guide To Wealth. His contributions include Chapter 1, “Anyone Can Achieve Wealth,” and Chapter 19, “Assisting Aging Parents.” Larry was also among the authors of the firm’s previous book
Looking Ahead: Life, Family, Wealth and Business After 55.
Posted by Larry M. Elkin, CPA, CFP®
I bought my first Toyota - a 1985 Camry - in 1987. I bought my first brand-new car, a Toyota Corolla, in 1991. All told, between 1987 and 2005, I bought seven cars. Six of them were Toyotas.
I made my non-Toyota purchase, a Ford Windstar, in 1995. I would have liked to get a Toyota, but I needed a minivan, and Toyota’s Previa just wasn’t a competitive offering. I bought two Toyotas in 2000, an Avalon and a Sienna minivan. In 2004 I bought another Avalon, and, in 2005, I bought another Sienna.
That's a lot of cars and a lot of brand loyalty. As for the number of cars, my two daughters were growing up and getting their licenses, so I needed to add to the fleet. And I made those cars Toyotas because I prized the company’s record of reliability and quality.
But when I was in the market for a new car for myself in 2007 — having finally run out of daughters who were going to take my car away — I decided up front not to buy a Toyota-made vehicle, including anything from Lexus. I felt the company's quality was slipping, and I did not like the way the carmaker and some of its dealers were responding to that slippage.
The 2000 Sienna's anti-lock braking system failed at about 70,000 miles, well beyond the 36,000-mile warranty but much too soon for my taste. The replacement part, a brake actuator, cost more than $1,300, and the installation would have been another $700. Toyota was not going to pay for the repair, and a dealer in New York didn’t offer any better solutions. So I took the car to a dealer in Florida, who located a used part and did the entire job for about $900.
Just when I was satisfied that I had resolved the anti-lock brake issue, the car's transmission started making disturbing noises. This time I found out on my own that Toyota recognized a problem with the Sienna transmissions and had a special repair program. But that same New York dealer said my car did not qualify. The Florida dealer said it did. So I brought the car back to Florida to get it fixed.
That same model year of the Sienna had a major problem with engine oil "gelling" and burning out engines. After plenty of customer complaints, Toyota reluctantly issued a special repair offer. Fortunately, my car never had that particular problem.
My 2004 Avalon had some minor but annoying quality control problems, such as a protective molding that peeled off the side of the car. The problems were all fixed under warranty but these were not the kinds of things I expected from a Toyota.
The 2005 Sienna was also faulty. It had a major problem with expensive run-flat tires that repeatedly wore out in less than 12,000 miles. Toyota offered a special one-time adjustment, but the problem persisted for several years until the tire makers finally improved their design.
So I was appalled, but not particularly surprised, when Toyota recently disclosed a critical problem with sticking accelerators that forced it to halt production and sales of some of its most popular models. Approximately 2.3 million vehicles will have to be recalled, according to the carmaker. This announcement came after many months in which the company first denied that there was a problem, and then blamed improperly installed floor mats.
Once it finally focused on the issue, Toyota said within a matter of days that it had developed a fix that is being rushed right now to dealers across America and Europe. Skeptics, including some regulators, are probing whether the fix is well-targeted, or if there is some other issue — perhaps a hardware or software problem with engine-control computers — that may account for some runaway acceleration incidents. Toyota says it has found no such problem in the computers.
In the meantime, the company has suffered another black eye with its abrupt disclosure, after earlier denials, that it is aware of a design problem with the anti-lock brakes in its Prius hybrid vehicles. Toyota quietly changed the design last month, but did not disclose the issue until public reports of Prius braking problems surfaced here and in Japan.
While Toyota says it can repair its cars, it may or may not be able to repair its reputation. Monthly sales fell 16 percent in the wake of the recall, and the company’s stock has sunk $25 billion in value. Some believe that the carmaker may never recover.
I think Toyota will be able to restore its image, but it is going to take a lot of work. For starters, Toyota can no longer get away with a chintzy three-year, 36,000-mile warranty. That kind of deal only works for companies that build cars customers are sure they can count on. Toyota has forfeited its membership in that club. For now, I would rather buy a car from Hyundai, which responded to earlier reliability issues both by improving its vehicles and by offering a 10-year, 100,000-mile warranty.
When my first Toyota was built, the company's slogan was "Oh, What a Feeling!" Right now, I'm feeling relieved that my latest car isn't a Toyota.
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