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Recently Toyota Motor Corp. has been facing negative publicity due to the fact that they had to make “call-backs” of their products. This Japanese car manufacturer had to recall more than 2 million of its cars. This create both internal and external problems. These problems will definitely affect the brand loyalty of Toyota in the consumer’s perspective.
One of the biggest external problem of this issue is that it would give this company a bad image both in front of the competitors and the loyal customers. Competitor will try to innovate and improve the own products in order to avoid such issue, one of them being the usage of quality control and quality assurance. In the eye of the loyal customer, Toyota has already have a bad image – as the car that does not prioritize on safety regulations.
In addition, the major internal problem that Toyota could be facing is the financial issue. Since they are calling back their products, requiring extra repair or changing extra parts could cost them millions of dollars. Due to that effect, it will affect Toyota’s liquidity or acid test ratio, as the stock could not be sold to the market due to the call-backs.
Hence, Toyota should implement a more appropriate quality control management in order to assure that there would be less or if it is possible no products that are defected.
http://www.time.com/time/business/article/0,8599,1957039,00.html
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