1. WHAT ARE THE PRIMARY CAUSES OF TOYOTA’S RECALL PROBLEM? The primary cause of Toyota’s recall was outsourcing their pedal manufacturing and assembly. To this day Toyota has recalled an estimated 2.3 million cars in the U.S. affected by the accelerator assembly problem, 4.2 million vehicles to fix the floor mat issue and out of all those vehicles 1.7 million of them were involved in both recalls (Linebaugh & Shirouzu, 2010). Amongst them are the 2008-2010 Sequoia sport utility vehicles. The main recall problem with the Sequoia’s is the accelerator pedal inside the pedal sensor. What happens over time is that the break lever rubs against the surface of the accelerator and overtime the surfaces may begin to stick. In the event that they do stick the pedals become slower to return to their original state or in some rare cases stick together leaving the throttle open and increasing the risk of a crash. The reasons for the pedals sticking vary from: materials used wear and tear and environmental conditions (Pedal Recall, 2010) According to Toyota they have identified the problem and have come up with a simple solution, they are doing everything they can to resolve the issue as quickly and convenient as possible in hopes of repairing the company image.
2. WERE THESE THE RESULT OF OUTSOURCING?
"The whole problem started with the outsourcing of the pedal and the pedal assembly," said Vito Polera, fleet manager at Toronto's Northwest Toyota dealership. "When Denso couldn't meet the demand, Toyota farmed out to CTS, which is the affected part" (Deveau, 2010). The pedals in question were manufactured by CTS Corp., a company that Toyota had to turn to when one of their primary tier one suppliers could not keep up with the demand. Yes this recall was a direct result of outsourcing, but other factors played a huge part. CTS stated that the accelerator pedals were manufacturer based on Toyota’s specific design specifications (Hannon, 2009). CTS has a large product list and do not specialize in the auto industry. The auto section of their business is a total of 30% of their revenue and Toyota is 3% of their sales (Healey, 2010). Toyota failed to set standards on what grade of materials were to be used to manufacture the pedals and CTS failed to test the pedals appropriately before they were sent out. If Toyota would have been involved with the material selection and testing, this recall may have been avoided. In a recent press statement Toyota stated that they have been working closely with their pedal supplier CTS on a revised design that effectively remedies the problem. The new pedals are now being produced at CTS to support Toyota’s demands. They also stated that they will continue to work with CTS to test effective pedal modifications for existing vehicles on the road and will make any replacements to those vehicles as needed (Dodge, 2010).
3. DRAW THE SPECIFIC TOYOTA SUPPLY CHAIN STRUCTURE FOR YOUR SPECIFIC RECALL PROBLEM.
For the 2008-2010 Sequoia models there is one direct tier 1 supplier to this problem and that would be CTS Corp. CTS is located in Elkhart, Indian U.S.A.. Below you will find a sample of Toyota’s SCM based only the accelerator pedal for its Sequoia’s. After the parts are taken from CTS to Toyota Motor Manufacturing in Alabama (TMMAL), where Toyota manufactures their V8 engines for their Sequoia’s (TMMAL, 2010), they are assembled there and are taken to warehouses to be distributed to different dealerships and then sold to customers.
4. WHAT ACTIONS HAVE BEEN TAKEN BY TOYOTA TO ADDRESS THE RECALL PROBLEMS?
Toyota has taken many steps to address this recall, after figuring out that the problem was with the pedal manufacturing, Toyota engineers have thoroughly tested the pedals and have come up with a very effective and simple solution to the recall. They have concluded that a “precision-cut steel reinforcement bar” (Consumer FAQ, 2010) needs to be installed on the pedal for it...