On the heels of becoming the world’s largest automobile manufacturer based on sales, Toyota is faced with a recall of nearly seven million vehicles in the United States. In addition, the Japanese company halted production and sales of its eight most popular U.S. models beginning February 1. The actions stem from a problem that causes accelerators to stick. At present, no one is suggesting that the situation raises any ethical concerns (note: be sure to stress this prior to discussion). Nevertheless, it is a case that offers a number of factors related to ethics and provides a good opportunity to examine Toyota’s actions through an ethical lens. The case is also effective for examining a number of operational issues including quality management.

QUESTIONS:

1. Describe the ethics intensity of the Toyota situation. What factors contribute to this intensity?
2. How do the internal and external environments of Toyota influence decision making on the recall?
3. Toyota first identified the accelerator problem in March 2007, yet the actions announced this week took nearly two years to implement. Consider the following explanations: “We needed time to study the problem and develop an adequate fix,” and “We considered this to be a drivability issue unrelated to safety.” A Massachusetts-based firm said its research identified 2,274 incidents of sudden unintended acceleration causing 275 crashes with 18 fatalities. A Toyota spokesperson stated, “I would say those data, based on the very diverse nature of his sources, are impossible to verify.” Discuss the legitimacy of these responses. Would any of them be consistent with rationalizations for unethical behavior?

SOURCE: K. Linebaugh & N. Shirouzu, “Toyota Halts Sales Over Safety Issues,” Wall Street Journal (Retrievable online at http://online.wsj.com/article/SB10001424052748704905604575027671658649384.html?mod=WSJ_article_MoreIn)

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