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Sun 14 Mar 2010 04:00 AM

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Rivals have let Toyota off the hook

The motor industry is renowned for being cut-throat, so why are Toyota's rivals not cashing in on the automaker's miseries?

Rivals have let Toyota off the hook
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The motor industry is renowned for being cut-throat, so why are Toyota's rivals not cashing in on the automaker's miseries?

When Toyota announced a huge recall of its cars - nearly 2.5 million in the US alone - over claims of a sticky accelerator pedal, it looked like the beginning of the end for the car giant.

What seemed like the final nail in the coffin was the release of a 911 call made by Toyota driver Chris Lastrella, shortly before he was killed. In a shocking recording Lastrella is heard saying: "We're in a Lexus. . . and we're going north on 125 and our accelerator is stuck. . . we're in trouble. . . there's no brakes. . .. we're approaching the intersection. . . hold on. . . hold on and pray. . . pray." Even veteran investigators said it was one of the worst accidents they had ever seen.

Recalls quickly followed across the world - eight million so far. I think it's fair to say that right now, nobody wants to buy a Toyota.

But one thing I find totally bemusing is the reaction from Toyota's rivals. The likes of Mazda, Honda and General Motors were all widely expected it launch aggressive marketing campaigns. Brutal I know, but surely this was the time to cash in on Toyota's misery.

So what did they do? General Motors launched a sheepish $1,000 discount offer to anyone trading in a Toyota. But that's it. The offer wasn't even advertised.

Mark Reuss, president of GM's North American business, even distanced himself from that offer, saying. "We are going to treat people and our competitors as we would like to be treated."

Competitor Honda urged its dealers to do absolutely nothing. "Our dealers are independent, but we have asked them to please restrain any urges to try to take a predatory stance in this type of environment," said Honda spokesman, Chris Martin.

For Mazda, which has just a 2 percent market share in the US, there could have been no better time to go after Toyota customers. Instead, chief financial officer Kiyoshi Ozaki has been at pains to stress there will be no marketing campaign on this issue, now or ever.

Have we not just been through the biggest financial crisis in living memory, one in which car manufacturers, particularly in the US, have been hit hardest? Aren't CEOs meant to look for, and cash in on, every opportunity that can grow their business? Aren't they meant to separate their emotions from the cut and thrust of business, especially the usually dirty playing motor industry?

None of this has happened. Toyota, thanks to its rivals, has been let off the hook.

The Grand Habtoor

It's not often you meet someone who really has the X-factor. Someone who has bounds of energy and enthusiasm, and most importantly, always gets it right.

So welcome to the world of Khalaf Al Habtoor. Last month, I was lucky enough to spend an hour in the company of a man who is surely a legend in Middle East business world. Al Habtoor has played an important role in helping to build the UAE and his achievements are well documented. But what really struck me about the 61-year-old is his insistence that companies and CEOs must stick to what they know. He learned this the hard way, telling me: "We should not step into something which we are not qualified to do. For example, because of convincing of friends I went into partnership with in soap factory. We lost it because we didn't know how to do it... If you enter in something in the line in which you have no experience in it, you will be in trouble."

He has a good point: if only everyone else thought this way a few years ago.

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John 10 years ago

The reason the other car maker CEO's did not make a big issue of Toyota recalls is probably because they have a lot more to hide than Toyota! At least Toyota came forward and have done something about, what are at the end of the day, quite minor issues. Of course, anyone who had a crash in a Toyota will blame unintended acceration. In some cases (Sikes) they blame unintended acceleration even on a car which is not affected by the accelerator recall!