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Straight Talk

By James Hettinger
Senior Advisor, Battle Creek Unlimited
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The Toyota troubles continue, fueled in no small part by the unholy alliance of government regulators, special interests and a veritable cockroach hotel of plaintiff attorneys. Besides federal fines, there is a blowing malodorous wind of scam artists driving their Toyotas off cliffs and blaming defective products. It doesn’t take being hit on the head by an Asian Carp to know what is going on here.

I am by no means current with Toyota leadership, but as an economic development practitioner, I tried every tactic and strategy in the book to lure them to Michigan. Twenty five years ago, when I was telling Toyota what a good place Michigan could be for them, they would respond with news clips of various Michigan congressional representatives ripping Toyota and other foreign automakers for this evil or that. Their conclusion was that they were not welcome in Michigan.

I once attended a session in Tokyo with the U.S. Trade Representative who blasted Japan for keeping foreign made automobiles out. After the session, I had to be careful crossing the streets to avoid being hit by automobiles made by Mercedes, BMW and Porsche. Of course, the U.S. Trade Representative had no explanation as to why the Europeans were successful selling cars in Japan while U.S. automakers could not seem to make it happen.

Now that the U.S. government and the United Auto Workers own substantial portions of General Motors and Chrysler, a paranoid Toyota executive wondering if the U.S. government was out to get them might not be so paranoid after all. When I think about the background, for example, of the Automotive Czar, it certainly lends itself to all kinds of intrigue against Toyota, justified or not.

Unfortunately, as I pointed out previously, 170,000 working Americans will be put at extreme economic risk, not to mention dozens of communities across the country, including two in West Michigan, and, of course, the Ann Arbor area.

While one can expect the administration in Washington to worry about friends and supporters, even those who have victimized the American consumer when they dominated the American market, one can hope that the intransigent unemployment numbers just might take some of the zeal out of the Federal feeding frenzy. But that is unlikely when one considers the pent up anger at foreign automakers and the childish unwillingness to accept even a smidgeon of responsibility for the mess in which traditional U.S. automakers find themselves.

It is right and just for a government to protect people from unsafe products and unsavory corporate and union practices. But this freight train seems to be a little too loaded up and I expect that thousands of working Americans will pay the price for overly zealous government intervention, same as they did when Congress got after corporate air travel. People at Duncan Aviation in Battle Creek and other aviation maintenance operations elsewhere may have been thrown out of work, but the Speaker of the House was never inconvenienced when it came to flying back and forth at the expense of the taxpayers.

After decades of seeing it happen, I am amazed that so few people really believe that this stuff impacts the people at the bottom, not the top. Stuff always travels downhill.

In this case, it is traveling at working Americans with healthcare benefits. Even when Toyota’s truck business took a big slide, they kept their people at work, rather than laying them off. Traditional automakers would have had those people on unemployment benefits in 10 seconds.

I suspect if a government watchdog group poured through thousands of government documents and emails, they would readily find examples of misdeeds and unethical behavior, especially if they were taken out of context. So, Toyota cannot realistically expect a clean bill of health from the U.S. government for a good long time. There is too much political hay to be made and too many privileged positions to protect.

There is significant pride within Toyota and it is hoped this pride will sustain the automaker’s resolve to stick it out in the American market. There are many other emerging markets where the Toyota brand is revered and respected. It does not take a load of imagination to hear somebody say that the American market has become too burdensome and too odious to occupy such an important part of the company’s global strategy. In such a case, tens of thousands of American workers are at immediate risk.

When planning a trip recently, I was asked what kind of rental I wanted. I answered I do not care as long as it is a Toyota. Toyota workers of America, unite. You have everything to lose, especially your jobs.

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