Auto Manifesto

March 7, 2010

Toyota Problems Compounded By Politics

Let me be perfectly clear. Toyota’s product issues with unintended acceleration are serious safety issues and I’m not downplaying their significance.

However, it is obvious that there is a political undercurrent to the whole debacle that is being amplified by the media that is clouding the true extent of the problems and resulting in even more irrational behavior than normal (panic).

People are losing thousands of dollars trading in their Toyotas. It reminds me of the results of the spike in fuels in 2008, which drove prices of fuel efficient small cars up (e.g. $8k for a mid-90’s Geo Metro).

Here are a few key points to think about.
  • Toyota overtook GM in 2008 to become the sales leader in the US market.
  • Toyota does not have a union workforce in its North American plants.
  • GM is mostly unionized.
  • The Democratic party has the support of the UAW (United Auto Workers).
  • The US Federal government is now the largest shareholder of General Motors (the UAW also holds a significant stake).
  • The US government is controlled by a Democratic administration.

I’m not going to mince words. Every major automaker has recalls, some more serious than others. But the propaganda machine has blown Toyota’s issues all out of proportion.

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