Tag Archives: toyota recall

When you competitor is your regulator

Imagine owning a grocery store, and your competitor determines what products you can sell.  Or that you’re a banker, and the owner of a competing bank tells you what hours you stay open.  Or  that you own an automobile dealership, and your competitor requires a certain brand of tires be on all the vehicles you sell.  Sounds far-fetched, doesn’t it?  And of course, it is.

Nevertheless, Toyota’s issues, which are huge, are PERCEIVED in some corners as being inflated because the government has an ownership interest in a competing auto manufacturer.  This is just one problem caused by the government getting in the business of owning companies that compete in the marketplace.  Especially when the government is an owner of U.S. company and the competitor is a foreign company.  Thrown in a comment by a representative of the competitor/regulator that your vehicles should not even be used (“Stop driving…”) (later retracted) and questions start being asked.   The first one is obvious: “Is this a conflict of interest?”

Tomorrow, February 23, the CEO of Toyota is scheduled to appear before a congressional committee.  It will not be pretty.  Neither will the aftermath, because one of the questions that will be raised is whether the government/competitor is singling out a competitor.  I’m not defending Toyota here, nor am I accusing the government.  Just pointing out that one of the dangers of government ownership of private business is fairness with competitors.

Toyota dealers picked a fight with one who buys ink by the barrel

“Never pick a fight with a man who buys ink by the barrel,” is a well-used quote that has been attributed to Mark Twain, Ben Franklin, William Jefferson Clinton, and others.  Regardless of its provenance, I have a feeling that Toyota, or at least 173 of its dealers, is going to wish it had heeded that advice.

I say that because Brian Ross, chief investigative correspondent for ABC News and a reporter who has been pushing this story for a relatively long time, revealed this morning that 173 Southeastern Toyota dealers had pulled their ads from local ABC affiliates and shifted the money to other stations, as reported in the New York Times.  Those dealers and Toyota might want to consider the hundreds of comments on Brian Ross’ blog. Now the story is about Toyota and its dealers attempting to punish a news organization for attempting to expose something.  They merely added fuel to the fire.  And the public is not siding with Toyota.  The dealers are caught in the middle.

Having said that, I can understand how they feel.  How would you like it if a news organization was doing negative reporting about your company and trying to sell advertising to you at the same time?  Nevertheless, the news organization has a whole lot more “ink,” so the protest will probably backfire. No, it is backfiring (pun intended).

Look for the next story to be about Toyota’s political contributions.(UPDATED)