WASHINGTON – Complaints of deaths connected to sudden acceleration in Toyota vehicles have surged in recent weeks, with the alleged death toll reaching 34 since 2000, according to new consumer data gathered by the government.
Complaints to a database maintained by the National Highway Traffic Safety Administration about the popular Toyota Prius hybrid grew by nearly 1,000 in just over a week.
On Monday, Transportation Department spokeswoman Olivia Alair said NHTSA is quickly gathering information to help guide the government's examination of sudden acceleration, the Prius braking system and other safety issues.
Toyota Motor Corp. has recalled 8.5 million vehicles globally during the past four months because of problems with gas pedals, floor mats and brakes, threatening the safety and quality reputation of the world's No. 1 automaker. The government typically receives a surge in complaints following a recall. None has yet been verified.
The new complaints reflect the heightened awareness of the massive recalls among the public and underscore a flurry of lawsuits on behalf of drivers alleging deaths and injuries in Toyota crashes. Three congressional hearings are planned on the Toyota recalls.
In the past three weeks, consumers have told the government about nine crashes involving 13 alleged deaths between 2005 and 2010 due to accelerator problems, according to a NHTSA database. The latest complaints come on top of information from consumers alleging 21 deaths from 2000 to the end of last year.
The database also shows that new complaints skyrocketed over the 2010 Prius gas-electric hybrid, which was recalled last week to replace braking software.
When NHTSA opened its investigation of Prius on Feb. 3, the government had received 124 consumer complaints. Through Feb. 11, the government had a total of 1,120 complaints alleging 34 crashes, six injuries and no deaths.
The government has renewed an investigation into potential electromagnetic problems in vehicles built by Toyota and other manufacturers. Consumer groups have pointed to potential electrical problems while the company has said recalls to fix sticking gas pedals or accelerators that can become jammed will address the problem.
Toyota spokeswoman Martha Voss said the company takes "all customer reports seriously and will, of course, look into new claims." Toyota was taking steps to improve quality control and investigate customer complaints more aggressively, Voss said.
Testing by Toyota, NHTSA and Exponent, an outside consulting firm hired by Toyota, has found no evidence of problems with Toyota's electronics, said Toyota Vice President Bob Carter at the National Automobile Dealers Association convention in Orlando, Fla.
"There is no problem with the electronic throttle system in Toyotas," Carter said Monday. "There's not anything that can even remotely lead you in that direction." Carter said Exponent was told to tear the components apart to try to find anything wrong and initial tests could find nothing.
Carter said Toyota has repaired about 500,000 of the 2.3 million vehicles recalled over a potentially sticky gas pedal.
Toyota has received many complaints over vehicle speed control in the 2009 and 2008 model years, according to an Associated Press analysis of government data.
In 2009, Toyota received the most complaints that year — a total of 130 for Toyota, Lexus and Scion vehicles. Ford and its Mercury brand received the second-highest with 14, followed by General Motors and Honda vehicles with 9.
Among Toyota vehicles in the 2009 model year, the Camry led the list of models with 52 complaints, followed by Corolla (17), Tacoma (16) and Prius (13). The AP found eight of the top 10 vehicles with complaints over vehicle speed control were manufactured by Toyota.
In the 2008 model year, Toyota vehicles received 176 complaints of vehicle speed control, followed by Ford with 44 and Chrysler with 25. In that year, Prius had 31 complaints, followed by Tacoma with 28 and Camry with 25.
Since Jan. 27, NHTSA has processed 686 complaints from consumers about problems related to "vehicle speed control" on cars and trucks manufactured by Toyota, nearly all of them submitted through NHTSA's Web site or by e-mail.
Regarding the AP analysis, Alair, the Transportation Department spokeswoman, noted that Toyota had a large market share of vehicles in the U.S. but said she could not comment on the AP figures without further analysis.
Tuesday, February 16, 2010
Friday, February 12, 2010
Your Cell Phone Company's Dirty Little Secret
Mobile phone companies have been lauded for slashing the cost of unlimited voice plans, but many wireless customers' monthly bills are actually going to get a bit more expensive.
Last month, both Verizon and AT&T lowered their unlimited voice plans by $30 to $70 per month. Sprint recently unveiled a plan that allows unlimited calls to any mobile device for $60 per month. That brought the three biggest mobile carriers' prices closer to rival T-Mobile, which offers a $60 per month unlimited plan, and in line with a slew of low-cost carriers that offer similar plans for about $40 per month.
But as the wireless giants go around touting their lower voice prices, data plan costs have been quietly moving higher for some non-smartphone customers.
It began with Verizon Wireless. Last month, that company began requiring certain non-smartphone customers to subscribe to a data plan that costs at least $10 per month. Mobile experts believe Verizon's move marks the first step in a larger trend to make up for carriers' lost revenue from voice.
"There's a big shift going on among mobile companies, in which there is a price reduction on voice and an increased emphasis on selling and requiring data services," said Dan Hays, partner at PRTM. "It is like a dirty little secret."
The New Smartphones
Smartphone owners are used to paying for an unlimited data plan with T-Mobile, Verizon and AT&T customers doling out the most: roughly $30 per month. Sprint offers a slightly different service, but also requires smartphone users to subscribe to an unlimited plan.
But non-smartphone customers aren't used to high-priced data plans. Less expensive, limited data plans have been largely available but not widely adopted. Verizon said it began to require new customers who purchase so-called "3G multimedia" phones to subscribe to a data plan in part so that they could get the full functionality out of their phones.
"Many customers didn't understand they could use the Web on their phones," said Brenda Raney, spokeswoman for Verizon Wireless. "We hope that people who were reluctant to use data plans because they didn't know it was affordable will use them now."
Previously, Verizon offered non-smartphone customers two data plans: $10 for up to 25 megabytes or $20 for up to 75 megabytes. In January, Verizon eliminated the $20 plan and replaced it with a $30 unlimited plan that was previously available only to smartphone users.
3G multimedia phones include a wide array of phones, ranging from the LG enV Touch, which has a touch screen and a QWERTY keyboard, to the Motorola Entice, essentially a standard flip phone that can access the mobile Web.
Other carriers are planning similar data requirements for their non-smartphone devices in the next several months, analysts say.
"Non-smartphone users aren't using as much data as smartphone users, but they're getting closer," said Ramon Lamas, mobile device analyst with IDC. "Carriers see them as a breeding ground for increased data usage."
Data Overload Vs. Revenue
It's not just about increasing revenue, say analysts. Carriers are banking on the consumer-friendly aspect: phones are more fun and useful with the Internet.
"The 'naked aggression' reason is to boost revenue to offset declining voice revenue," said Charles Golvin, mobile analyst with Forrester Research. "But carriers also realize consumers won't get the enjoyment out of their devices without data."
But analysts caution that carriers need to be careful of data overload. 3G data networks are already in high demand from smartphone users, and smartphone usage was up 40% in 2009, according to an IDC study. AT&T has had well-documented 3G network troubles in New York and San Francisco due to the success of the data-hogging iPhone.
"Carriers are getting people to move to data, but they're doing it cautiously," said Lamas. "Rather than have everyone move to data immediately, they're testing the waters and taking the people who can weather higher prices first."
"Look how much revenue AT&T is getting from the iPhone," said Golvin. "It's easy for Verizon to make hay of AT&T's problems, but it's a problem that Verizon wishes it had."
Last month, both Verizon and AT&T lowered their unlimited voice plans by $30 to $70 per month. Sprint recently unveiled a plan that allows unlimited calls to any mobile device for $60 per month. That brought the three biggest mobile carriers' prices closer to rival T-Mobile, which offers a $60 per month unlimited plan, and in line with a slew of low-cost carriers that offer similar plans for about $40 per month.
But as the wireless giants go around touting their lower voice prices, data plan costs have been quietly moving higher for some non-smartphone customers.
It began with Verizon Wireless. Last month, that company began requiring certain non-smartphone customers to subscribe to a data plan that costs at least $10 per month. Mobile experts believe Verizon's move marks the first step in a larger trend to make up for carriers' lost revenue from voice.
"There's a big shift going on among mobile companies, in which there is a price reduction on voice and an increased emphasis on selling and requiring data services," said Dan Hays, partner at PRTM. "It is like a dirty little secret."
The New Smartphones
Smartphone owners are used to paying for an unlimited data plan with T-Mobile, Verizon and AT&T customers doling out the most: roughly $30 per month. Sprint offers a slightly different service, but also requires smartphone users to subscribe to an unlimited plan.
But non-smartphone customers aren't used to high-priced data plans. Less expensive, limited data plans have been largely available but not widely adopted. Verizon said it began to require new customers who purchase so-called "3G multimedia" phones to subscribe to a data plan in part so that they could get the full functionality out of their phones.
"Many customers didn't understand they could use the Web on their phones," said Brenda Raney, spokeswoman for Verizon Wireless. "We hope that people who were reluctant to use data plans because they didn't know it was affordable will use them now."
Previously, Verizon offered non-smartphone customers two data plans: $10 for up to 25 megabytes or $20 for up to 75 megabytes. In January, Verizon eliminated the $20 plan and replaced it with a $30 unlimited plan that was previously available only to smartphone users.
3G multimedia phones include a wide array of phones, ranging from the LG enV Touch, which has a touch screen and a QWERTY keyboard, to the Motorola Entice, essentially a standard flip phone that can access the mobile Web.
Other carriers are planning similar data requirements for their non-smartphone devices in the next several months, analysts say.
"Non-smartphone users aren't using as much data as smartphone users, but they're getting closer," said Ramon Lamas, mobile device analyst with IDC. "Carriers see them as a breeding ground for increased data usage."
Data Overload Vs. Revenue
It's not just about increasing revenue, say analysts. Carriers are banking on the consumer-friendly aspect: phones are more fun and useful with the Internet.
"The 'naked aggression' reason is to boost revenue to offset declining voice revenue," said Charles Golvin, mobile analyst with Forrester Research. "But carriers also realize consumers won't get the enjoyment out of their devices without data."
But analysts caution that carriers need to be careful of data overload. 3G data networks are already in high demand from smartphone users, and smartphone usage was up 40% in 2009, according to an IDC study. AT&T has had well-documented 3G network troubles in New York and San Francisco due to the success of the data-hogging iPhone.
"Carriers are getting people to move to data, but they're doing it cautiously," said Lamas. "Rather than have everyone move to data immediately, they're testing the waters and taking the people who can weather higher prices first."
"Look how much revenue AT&T is getting from the iPhone," said Golvin. "It's easy for Verizon to make hay of AT&T's problems, but it's a problem that Verizon wishes it had."
Relatively few complain about Toyota
NEW YORK (CNNMoney.com) -- Despite a torrent of high-profile recalls that have tarnished Toyota's once stellar reputation, a study published Wednesday reveals that the automaker actually gets fewer customer complaints per car than the majority of its competitors.
Edmunds.com reviewed more than 200,000 complaints filed with the National Highway Traffic Safety Administration (NHTSA) over the last decade and found that Toyota ranked 17th among the top 20 automakers in the overall number of complaints per vehicle sold.
The results come amid a series of recalls totaling more than 8.1 million Toyotas worldwide, including 400,000 of the popular 2010 Prius hybrid for problems associated with sticking brake pedals, software glitches and faulty floormats.
The study was based on the percentage of complaints each automaker received versus the total number of vehicles they sold in the United States between 2001 and 2010.
As a result, British carmaker Land Rover had the highest proportion of complaints relative to the number of cars it sold. The company received 0.6% of the total complaints in the database, while its sales amounted to only 0.1% of all new cars sold in the United States.
Meanwhile, Toyota had 9.1% of all the complaints in the database. But the company was number 17 on the list because its sales made up 13.5% of the U.S. market.
According to the study, Toyota had fewer complaints than its American rivals. Ford was number 10 on the list, while General Motors came in at number 11.
The only automakers to receive fewer complaints than Toyota were Mercedes-Benz, Porsche and the Mercedes-made Smart Car.
Among the other automakers that ranked high on the list were Suzuki and Isuzu, which came in at numbers 2 and 3 respectively. German automaker Volkswagen came in at number 4.
The complaints lodged against Toyota ranged from minor problems with lighting to more serious issues such as sudden acceleration and difficulty steering. But the study did not rate the reported incidences for severity.
Edmunds.com said that it found some unreliable reports in the database, including one complaint indicating that 99 people had died in one vehicle as a result of an accident. It also said that about 10% of the complaints appeared to be duplicates.
Quality control: Not just Toyota's problem
While the issues raised by Toyota's recent recalls shouldn't be overlooked, quality control concerns are apparent across the entire automobile industry, said Jeremy Anwyl, Edmunds.com chief executive.
"A broader view shows that consumer complaints reflect an industry issue, not just a Toyota issue," said Anwyl. "It is no longer an option for car companies to dismiss consumer complaints, even if the event is difficult to replicate or diagnose."
Some automakers assume that customer complaints are the result of driver error and not necessarily a reflection of design problems, said Jeannine Fallon, an Edmunds.com analyst.
"It depends on the culture of the car company," she said. "But it's clear now that Toyota has not had very many conversations with NHTSA."
Edmunds.com reviewed more than 200,000 complaints filed with the National Highway Traffic Safety Administration (NHTSA) over the last decade and found that Toyota ranked 17th among the top 20 automakers in the overall number of complaints per vehicle sold.
The results come amid a series of recalls totaling more than 8.1 million Toyotas worldwide, including 400,000 of the popular 2010 Prius hybrid for problems associated with sticking brake pedals, software glitches and faulty floormats.
The study was based on the percentage of complaints each automaker received versus the total number of vehicles they sold in the United States between 2001 and 2010.
As a result, British carmaker Land Rover had the highest proportion of complaints relative to the number of cars it sold. The company received 0.6% of the total complaints in the database, while its sales amounted to only 0.1% of all new cars sold in the United States.
Meanwhile, Toyota had 9.1% of all the complaints in the database. But the company was number 17 on the list because its sales made up 13.5% of the U.S. market.
According to the study, Toyota had fewer complaints than its American rivals. Ford was number 10 on the list, while General Motors came in at number 11.
The only automakers to receive fewer complaints than Toyota were Mercedes-Benz, Porsche and the Mercedes-made Smart Car.
Among the other automakers that ranked high on the list were Suzuki and Isuzu, which came in at numbers 2 and 3 respectively. German automaker Volkswagen came in at number 4.
The complaints lodged against Toyota ranged from minor problems with lighting to more serious issues such as sudden acceleration and difficulty steering. But the study did not rate the reported incidences for severity.
Edmunds.com said that it found some unreliable reports in the database, including one complaint indicating that 99 people had died in one vehicle as a result of an accident. It also said that about 10% of the complaints appeared to be duplicates.
Quality control: Not just Toyota's problem
While the issues raised by Toyota's recent recalls shouldn't be overlooked, quality control concerns are apparent across the entire automobile industry, said Jeremy Anwyl, Edmunds.com chief executive.
"A broader view shows that consumer complaints reflect an industry issue, not just a Toyota issue," said Anwyl. "It is no longer an option for car companies to dismiss consumer complaints, even if the event is difficult to replicate or diagnose."
Some automakers assume that customer complaints are the result of driver error and not necessarily a reflection of design problems, said Jeannine Fallon, an Edmunds.com analyst.
"It depends on the culture of the car company," she said. "But it's clear now that Toyota has not had very many conversations with NHTSA."
Wednesday, February 3, 2010
Prius brakes questioned; Toyota probe expands
WASHINGTON – Americans should park their recalled Toyotas unless driving to dealers for accelerator repairs, Transportation Secretary Ray LaHood warned Wednesday — then quickly took it back — as skepticism of company fixes grew and the government's probe expanded to other models in the U.S. and Japan. Questions now are being raised about the brakes on Toyota's marquee Prius hybrid.
The Prius was not part of the most recent recall, but Japan's transport ministry ordered the company to investigate complaints of brake problems with the hybrid. LaHood said his department, too, was looking into brake problems. About 100 complaints over Prius brakes have been filed in the U.S. and Japan.
Harried dealers began receiving parts to repair defective gas pedals in millions of vehicles and said they'd be extending their hours deep into the night to try and catch up. Toyota said that would solve the problem — which it said was extremely rare — of cars unaccountably accelerating.
At a congressional hearing, LaHood said his advice to an owner of a recalled Toyota would be to "stop driving it. Take it to a Toyota dealer because they believe they have a fix for it." His comments prompted new questions and rattled Toyota stockholders, causing shares to plunge 8 percent before they recovered, declining 6 percent for the day.
LaHood later told reporters, "What I said in there was obviously a misstatement. What I meant to say ... was if you own one of these cars or if you're in doubt, take it to the dealer and they're going to fix it."
Adding to Toyota's woes, LaHood said his department had received new complaints about electronics and would undertake a broad review, looking beyond Toyota vehicles, into whether automobile engines could be disrupted by electromagnetic interference caused by power lines or other sources. Toyota has said it investigated for electronic problems and failed to find a single case pointing that direction.
Toyota Motor Corp., in a statement, said if owners were experiencing problems with the accelerator pedal "please contact your dealer without delay. If you are not experiencing any issues with your pedal, we are confident that your vehicle is safe to drive."
But the damage was done for many drivers.
Meredyth Waterman, who bought a 2010 Toyota Corolla in December, said the alarming statements from Washington confused her and she planned to wait until her dealer told her to come get the fix to bring her car in for repairs.
"If it is largely believed to be a rare instance, why would he tell people to stop driving their cars?" asked Waterman, of Burrillville, R.I. "It was an irresponsible thing to say."
The confusion came as the world's No. 1 automaker dealt with fresh probes in the U.S. and Japan over the Prius, the best-selling gas-electric hybrid, and growing interest from congressional and other government investigators. Toyota has shut down several new vehicle assembly lines and is rushing parts to dealers to fix problems with the accelerators, trying to preserve a reputation of building safe, durable vehicles.
Since October, Toyota first recalled about 5 million vehicles over problems with floor mats trapping gas pedals and now, in a recall announced Jan. 21, some 2.3 million vehicles amid concerns that gas pedals could become stuck or slow to return to the idle position. The latest recall involves 2009-10 RAV4 crossovers, 2009-10 Corollas, 2009-10 Matrix hatchbacks, 2005-10 Avalons, 2007-10 Camrys, 2010 Highlander crossovers, 2007-10 Tundra pickups and 2008-10 Sequoia SUVs.
Lawmakers who are now digging into the recalls said they would also look into the Prius. Rep. Bart Stupak, chairman of the House Energy and Commerce investigative subcommittee, said his panel would request a briefing from Toyota officials about the hybrid.
New York Rep. Edolphus Towns, chairman of the House Oversight and Government Reform Committee, sought more information about the acceleration issue from Yoshi Inaba, chairman and CEO of Toyota Motor North America and asked the question on the minds of Toyota owners: "Is it safe to drive the Toyota models that have been recalled?"
Towns' committee, which is planning a Feb. 10 hearing, also wants more details on how Toyota handled complaints about pedal entrapment, reports of stuck accelerators and electrical problems. Other panels in the House and Senate also are planning hearings.
Many consumer groups have questioned whether Toyota's fix will work and have asserted it could be connected to problems with the electronic throttle control systems.
Joan Claybrook, who formerly lead Public Citizen, a watchdog group, noted that Toyota told owners during last year's recall to remove floor mats to keep the accelerator pedal from becoming jammed. "I don't think that's what the issue is. I think it has to be electronic when it slam dunks and takes off and goes 120 miles an hour," Claybrook said.
The National Highway Traffic Safety Administration, meanwhile, asked CTS, the Indiana company that made the pedals behind Toyota's latest recall, if the same problem could exist for other automakers. CTS makes pedals for Honda, Nissan and a small number of Ford vehicles in China, but the auto supplier has said the issues are limited to Toyota alone.
LaHood, who plans to speak with Toyota President Akio Toyoda about the recalls, said the government is considering civil penalties against the carmaker. But he also said that it appeared "Toyota is making an all-out effort to do all that they can to fix these cars."
The Obama administration has been forced to backtrack on several statements during its first year, though LaHood's warning was particularly striking.
Last year, when LaHood suggested the administration consider taxing motorists based on how many miles they drive instead of how much gasoline they buy, his comments were quickly rejected by the White House. Vice President Joe Biden triggered a day of backtracking after publicly swearing off trains and planes because of swine flu worries.
LaHood's comments irked many dealers, who have been fielding calls from nervous customers for days. Most dealers are just getting the parts, a steel shim a couple of millimeters thick, to be inserted in the pedal assembly to address potential friction that could cause the pedal to stick.
The secretary "has the best of intentions, but unfortunately we can't fix 100 cars at the same time," said Adam Lee, head of Lee Auto Malls and owner of a Toyota dealership in Topsham, Maine. "I'm sure he has the best of intentions but it may not be very constructive for us."
Earl Stewart, who owns a Toyota dealership in North Palm Beach, Fla., said LaHood's comments "could instill panic." Stewart was expecting to begin making repairs — at half an hour per vehicle — later Wednesday.
"We're leaving our service department open 'til the last customer tonight," he said. "After Ray LaHood's statement, it might be all night."
The Prius was not part of the most recent recall, but Japan's transport ministry ordered the company to investigate complaints of brake problems with the hybrid. LaHood said his department, too, was looking into brake problems. About 100 complaints over Prius brakes have been filed in the U.S. and Japan.
Harried dealers began receiving parts to repair defective gas pedals in millions of vehicles and said they'd be extending their hours deep into the night to try and catch up. Toyota said that would solve the problem — which it said was extremely rare — of cars unaccountably accelerating.
At a congressional hearing, LaHood said his advice to an owner of a recalled Toyota would be to "stop driving it. Take it to a Toyota dealer because they believe they have a fix for it." His comments prompted new questions and rattled Toyota stockholders, causing shares to plunge 8 percent before they recovered, declining 6 percent for the day.
LaHood later told reporters, "What I said in there was obviously a misstatement. What I meant to say ... was if you own one of these cars or if you're in doubt, take it to the dealer and they're going to fix it."
Adding to Toyota's woes, LaHood said his department had received new complaints about electronics and would undertake a broad review, looking beyond Toyota vehicles, into whether automobile engines could be disrupted by electromagnetic interference caused by power lines or other sources. Toyota has said it investigated for electronic problems and failed to find a single case pointing that direction.
Toyota Motor Corp., in a statement, said if owners were experiencing problems with the accelerator pedal "please contact your dealer without delay. If you are not experiencing any issues with your pedal, we are confident that your vehicle is safe to drive."
But the damage was done for many drivers.
Meredyth Waterman, who bought a 2010 Toyota Corolla in December, said the alarming statements from Washington confused her and she planned to wait until her dealer told her to come get the fix to bring her car in for repairs.
"If it is largely believed to be a rare instance, why would he tell people to stop driving their cars?" asked Waterman, of Burrillville, R.I. "It was an irresponsible thing to say."
The confusion came as the world's No. 1 automaker dealt with fresh probes in the U.S. and Japan over the Prius, the best-selling gas-electric hybrid, and growing interest from congressional and other government investigators. Toyota has shut down several new vehicle assembly lines and is rushing parts to dealers to fix problems with the accelerators, trying to preserve a reputation of building safe, durable vehicles.
Since October, Toyota first recalled about 5 million vehicles over problems with floor mats trapping gas pedals and now, in a recall announced Jan. 21, some 2.3 million vehicles amid concerns that gas pedals could become stuck or slow to return to the idle position. The latest recall involves 2009-10 RAV4 crossovers, 2009-10 Corollas, 2009-10 Matrix hatchbacks, 2005-10 Avalons, 2007-10 Camrys, 2010 Highlander crossovers, 2007-10 Tundra pickups and 2008-10 Sequoia SUVs.
Lawmakers who are now digging into the recalls said they would also look into the Prius. Rep. Bart Stupak, chairman of the House Energy and Commerce investigative subcommittee, said his panel would request a briefing from Toyota officials about the hybrid.
New York Rep. Edolphus Towns, chairman of the House Oversight and Government Reform Committee, sought more information about the acceleration issue from Yoshi Inaba, chairman and CEO of Toyota Motor North America and asked the question on the minds of Toyota owners: "Is it safe to drive the Toyota models that have been recalled?"
Towns' committee, which is planning a Feb. 10 hearing, also wants more details on how Toyota handled complaints about pedal entrapment, reports of stuck accelerators and electrical problems. Other panels in the House and Senate also are planning hearings.
Many consumer groups have questioned whether Toyota's fix will work and have asserted it could be connected to problems with the electronic throttle control systems.
Joan Claybrook, who formerly lead Public Citizen, a watchdog group, noted that Toyota told owners during last year's recall to remove floor mats to keep the accelerator pedal from becoming jammed. "I don't think that's what the issue is. I think it has to be electronic when it slam dunks and takes off and goes 120 miles an hour," Claybrook said.
The National Highway Traffic Safety Administration, meanwhile, asked CTS, the Indiana company that made the pedals behind Toyota's latest recall, if the same problem could exist for other automakers. CTS makes pedals for Honda, Nissan and a small number of Ford vehicles in China, but the auto supplier has said the issues are limited to Toyota alone.
LaHood, who plans to speak with Toyota President Akio Toyoda about the recalls, said the government is considering civil penalties against the carmaker. But he also said that it appeared "Toyota is making an all-out effort to do all that they can to fix these cars."
The Obama administration has been forced to backtrack on several statements during its first year, though LaHood's warning was particularly striking.
Last year, when LaHood suggested the administration consider taxing motorists based on how many miles they drive instead of how much gasoline they buy, his comments were quickly rejected by the White House. Vice President Joe Biden triggered a day of backtracking after publicly swearing off trains and planes because of swine flu worries.
LaHood's comments irked many dealers, who have been fielding calls from nervous customers for days. Most dealers are just getting the parts, a steel shim a couple of millimeters thick, to be inserted in the pedal assembly to address potential friction that could cause the pedal to stick.
The secretary "has the best of intentions, but unfortunately we can't fix 100 cars at the same time," said Adam Lee, head of Lee Auto Malls and owner of a Toyota dealership in Topsham, Maine. "I'm sure he has the best of intentions but it may not be very constructive for us."
Earl Stewart, who owns a Toyota dealership in North Palm Beach, Fla., said LaHood's comments "could instill panic." Stewart was expecting to begin making repairs — at half an hour per vehicle — later Wednesday.
"We're leaving our service department open 'til the last customer tonight," he said. "After Ray LaHood's statement, it might be all night."
Saturday, January 30, 2010
Toyota Shows How Giants Stumble
At General Motors, they used to call their surging competitor "Mr. T," as if intimidated by a muscular rival who seemed able to seize market share at will. But Toyota suddenly looks pretty meek, thanks to a mystifying safety problem that has led to a huge recall, an unprecedented production shutdown, and an ugly dent in a once sterling reputation.
This corporate nightmare has mushroomed since last fall, when Toyota recalled about 4 million vehicles because of floor mats with a propensity to slip down into the driver's side foot well, potentially interfering with the pedals and causing sudden acceleration. Now Toyota has recalled an additional 2.3 million vehicles for a problem that sounds similar, but the company says it's different: faulty gas pedals that can stick if they become worn, causing--once again--sudden acceleration.
[See 15 cars fueling the auto recovery.]
Recalls aren't unusual. Here's what normally happens: The owner gets notified of the recall and brings the car to a dealer, where the problem is fixed in a day or two with no charge to the customer. But this recall is more confusing and far more draconian than usual. For one thing, Toyota announced the recall before there was a fix in place, so dealers didn't even know what to do if you brought them the car. Toyota implies that most of the recalled vehicles can still be driven safely, but it also offers these instructions for people who feel their car might have a sticky gas pedal: "The vehicle should be driven to the nearest safe location, the engine shut off, and a Toyota dealer contacted for assistance." Beyond that, Toyota has also issued some Dukes of Hazzard style maneuvers drivers should use if they're cruising along and the pedal does, in fact, stick, such as shifting into neutral or turning off the ignition (but don't take the key out!). Do they teach that in driver's ed?
If you're a concerned parent with a suspect Toyota, you could easily imagine that the gas pedal seems a little stickier than usual. And do what? Risk your kids' lives by driving them around in a death trap? Pull off on the side of the highway and call a taxi? Garage the car and rent something safe--at $300 per week--until Toyota figures out what's going on? Stressing out your customers like that isn't exactly the way to win repeat business.
The sales and production stoppage suggests an even bigger problem, with lots of legal liability. Toyota has stopped selling or building eight models, including the Camry, Corolla, and RAV 4, which represent more than 50 percent of its sales. That will cost Toyota millions, maybe billions, of dollars. It already ranks near the top in the annals of corporate meltdowns, and it's not necessarily over. GM, meanwhile, is poaching Toyota customers with special financing and other incentives, along with cars that go the speed you want them to.
[See 10 products that boomed during the recession.]
How did this happen? Toyota itself may not even know yet, and it could take months or years for the full story to develop. But Toyota's dramatic comedown isn't as sudden as it might seem. Some industry-watchers feel the saga has been building for years and may even have been inevitable.
In his 2009 book, How the Mighty Fall, business guru Jim Collins outlined five stages of decline that many big companies go through. Mostly he wrote about companies that lose their edge gradually, even imperceptibly, until thousands of tiny termite holes bring down the house. Toyota might qualify as an accelerated version of such a collapse.
Toyota has grown steadily into the world's biggest automaker, earning customer loyalty for the reliability and longevity of its vehicles. But problems have been slowly building. The T100 pickup sold in the 1990s failed to hit Toyota's usual mark for quality, with some critics complaining that it was an underpowered make-do truck that paled next to American counterparts. Beginning around 1999, thousands of Toyota owners complained about mysterious "sludge" buildup that wrecked their engines, prompting criticism that Toyota was growing too fast and skimping on quality; Toyota resisted the claims but settled a class action lawsuit brought by owners in 2007. Toyota owners have also complained about faulty head lamps on the Prius hybrid, and more than 100,000 Tundra pickups were recalled in 2009 for problems with rusting frames. On the business side, Toyota badly miscalculated when it built a new pickup plant in Texas, with sales far below projections.
[See 21 things we're learning to live without.]
Consumers have noticed. Surveys by CNW Marketing Research in Brandon, Ore., show that from 1997 to 2007, Toyota consistently ranked at the top for nonluxury car makers, neck and neck with Honda. For 10 straight years, consumers rated Toyota 9.1 or higher, on average, out of 10. In 2008, that rating slipped below 9 for the first time, and in the latest survey--which took place before the gas-pedal recall--respondents gave Toyota an 8.5 rating. That's lower than the ratings for Honda, Buick, Mazda, Volkswagen, Ford, and even Saturn.
Toyota's recent history lines up fairly well with Collins's taxonomy of decline. His first stage is "hubris born of success," which certainly could apply to Toyota. For years, Toyota was a model of efficient manufacturing, mimicked even by firms in different industries. That may have convinced the firm's leaders they could grow rapidly and maintain quality at any size. Next in the evolution of decline comes "undisciplined pursuit of more." Toyota definitely had grand ambitions--to become the world's biggest automaker--but it's not clear yet if the firm was undisciplined or simply took risks that went against it. Collins's third stage is "denial of risk and peril," which many critics certainly saw in Toyota's rigid refutation of consumer complaints. Stage four is "grasping for salvation," which is what Toyota seems to be doing now.
[See 4 things that could derail a recovery.]
It's a safe bet, however, that Toyota will escape Collins's fifth stage: "capitulation to irrelevance or death." Despite its woes, Toyota remains a strong brand and a powerful company, and falling on its sword today may be the best path toward a corporate rebound. Surveys by BrandIndex, a market research firm, show that Toyota's "buzz" score--reflecting consumers' immediate perception of the brand--have dipped to historic lows. But positive impressions of Toyota still outweigh negative ones, which means customers are likely to return if the company solves its problems once and for all--and makes amends. "Consumers are pretty forgiving of blue-chip brands," says Ted Marzilli of BrandIndex. "Prospects are still quite good for Toyota, provided the issue is resolved quickly, there is clear communication to consumers, and there are no more issues in the near future." And humility replaces hubris.
This corporate nightmare has mushroomed since last fall, when Toyota recalled about 4 million vehicles because of floor mats with a propensity to slip down into the driver's side foot well, potentially interfering with the pedals and causing sudden acceleration. Now Toyota has recalled an additional 2.3 million vehicles for a problem that sounds similar, but the company says it's different: faulty gas pedals that can stick if they become worn, causing--once again--sudden acceleration.
[See 15 cars fueling the auto recovery.]
Recalls aren't unusual. Here's what normally happens: The owner gets notified of the recall and brings the car to a dealer, where the problem is fixed in a day or two with no charge to the customer. But this recall is more confusing and far more draconian than usual. For one thing, Toyota announced the recall before there was a fix in place, so dealers didn't even know what to do if you brought them the car. Toyota implies that most of the recalled vehicles can still be driven safely, but it also offers these instructions for people who feel their car might have a sticky gas pedal: "The vehicle should be driven to the nearest safe location, the engine shut off, and a Toyota dealer contacted for assistance." Beyond that, Toyota has also issued some Dukes of Hazzard style maneuvers drivers should use if they're cruising along and the pedal does, in fact, stick, such as shifting into neutral or turning off the ignition (but don't take the key out!). Do they teach that in driver's ed?
If you're a concerned parent with a suspect Toyota, you could easily imagine that the gas pedal seems a little stickier than usual. And do what? Risk your kids' lives by driving them around in a death trap? Pull off on the side of the highway and call a taxi? Garage the car and rent something safe--at $300 per week--until Toyota figures out what's going on? Stressing out your customers like that isn't exactly the way to win repeat business.
The sales and production stoppage suggests an even bigger problem, with lots of legal liability. Toyota has stopped selling or building eight models, including the Camry, Corolla, and RAV 4, which represent more than 50 percent of its sales. That will cost Toyota millions, maybe billions, of dollars. It already ranks near the top in the annals of corporate meltdowns, and it's not necessarily over. GM, meanwhile, is poaching Toyota customers with special financing and other incentives, along with cars that go the speed you want them to.
[See 10 products that boomed during the recession.]
How did this happen? Toyota itself may not even know yet, and it could take months or years for the full story to develop. But Toyota's dramatic comedown isn't as sudden as it might seem. Some industry-watchers feel the saga has been building for years and may even have been inevitable.
In his 2009 book, How the Mighty Fall, business guru Jim Collins outlined five stages of decline that many big companies go through. Mostly he wrote about companies that lose their edge gradually, even imperceptibly, until thousands of tiny termite holes bring down the house. Toyota might qualify as an accelerated version of such a collapse.
Toyota has grown steadily into the world's biggest automaker, earning customer loyalty for the reliability and longevity of its vehicles. But problems have been slowly building. The T100 pickup sold in the 1990s failed to hit Toyota's usual mark for quality, with some critics complaining that it was an underpowered make-do truck that paled next to American counterparts. Beginning around 1999, thousands of Toyota owners complained about mysterious "sludge" buildup that wrecked their engines, prompting criticism that Toyota was growing too fast and skimping on quality; Toyota resisted the claims but settled a class action lawsuit brought by owners in 2007. Toyota owners have also complained about faulty head lamps on the Prius hybrid, and more than 100,000 Tundra pickups were recalled in 2009 for problems with rusting frames. On the business side, Toyota badly miscalculated when it built a new pickup plant in Texas, with sales far below projections.
[See 21 things we're learning to live without.]
Consumers have noticed. Surveys by CNW Marketing Research in Brandon, Ore., show that from 1997 to 2007, Toyota consistently ranked at the top for nonluxury car makers, neck and neck with Honda. For 10 straight years, consumers rated Toyota 9.1 or higher, on average, out of 10. In 2008, that rating slipped below 9 for the first time, and in the latest survey--which took place before the gas-pedal recall--respondents gave Toyota an 8.5 rating. That's lower than the ratings for Honda, Buick, Mazda, Volkswagen, Ford, and even Saturn.
Toyota's recent history lines up fairly well with Collins's taxonomy of decline. His first stage is "hubris born of success," which certainly could apply to Toyota. For years, Toyota was a model of efficient manufacturing, mimicked even by firms in different industries. That may have convinced the firm's leaders they could grow rapidly and maintain quality at any size. Next in the evolution of decline comes "undisciplined pursuit of more." Toyota definitely had grand ambitions--to become the world's biggest automaker--but it's not clear yet if the firm was undisciplined or simply took risks that went against it. Collins's third stage is "denial of risk and peril," which many critics certainly saw in Toyota's rigid refutation of consumer complaints. Stage four is "grasping for salvation," which is what Toyota seems to be doing now.
[See 4 things that could derail a recovery.]
It's a safe bet, however, that Toyota will escape Collins's fifth stage: "capitulation to irrelevance or death." Despite its woes, Toyota remains a strong brand and a powerful company, and falling on its sword today may be the best path toward a corporate rebound. Surveys by BrandIndex, a market research firm, show that Toyota's "buzz" score--reflecting consumers' immediate perception of the brand--have dipped to historic lows. But positive impressions of Toyota still outweigh negative ones, which means customers are likely to return if the company solves its problems once and for all--and makes amends. "Consumers are pretty forgiving of blue-chip brands," says Ted Marzilli of BrandIndex. "Prospects are still quite good for Toyota, provided the issue is resolved quickly, there is clear communication to consumers, and there are no more issues in the near future." And humility replaces hubris.
Texas Leads U.S. in High-Growth Cities
A new survey finds the Lone Star State is leading in terms of growth rate and household income. Atascocita, Tex., is No. 1 in the state
Tired of reading about how rotten the real estate market is? Here's some good news that shows that even during the worst of the recession plenty of American cities, towns, and suburbs continue to grow.
One such place is Atascocita, Tex. A mostly residential community 20 miles from Houston, it gained more than 1,800 households in 2009, an 8% year-over-year increase, according to new data from Little Rock-based data firm Gadberry Group. Over the decade, amenities that have helped attract residents to this wooded locale include Lake Houston, just east of the city; the school district; and proximity to the city of Houston. With new roads in the area under construction, "we're starting to see major industry start to take a look at the area," says Mike Byers, president of the Lake Houston Area Chamber of Commerce.
Migration levels nationwide stayed low last year as homeowners saddled with pricey mortgages stayed put--but there are some positive trends. Research by the Gadberry Group shows that some areas, resisting the effects of the recession, continue to attract both domestic and foreign migrants and, as an effect, bring in new businesses to provide services. While other cities across the U.S. have contracted, these have continued to grow.
Some states are better off than others, though. As thousands of people left places such as New Orleans and Flint, Mich. (the country's two fastest-shrinking cities), in the last decade, communities with the best mix of economic activity, proximity to job centers, and a good environment for families continued to grow. While not entirely spared by the economic downturn (some homes in these areas are now in foreclosure), people continued to move in during 2009.
Texas Grew the Most
Texas came out on top of Gadberry's survey, with four high-growth cities: Atascocita, Katy, Mansfield, and Wylie. The report only included areas larger than 10,000 occupied households that met requirements for growth rate, household income, length of residence, and other factors.
Larry Martin, principal of the Gadberry Group, says many of the places with the biggest housing growth at the beginning of the last decade, such as Nevada, Florida, and Arizona, also saw the biggest drop-off since the economy sank. Texas, however, enjoyed relatively strong housing and job markets over the last 10 years, thanks in large part to the presence of major employers in the robust energy business. As of December, the state unemployment rate was 8.3% (lower than the national rate of 10%), according to data from the Bureau of Labor Statistics. It also had the largest state population growth between July 2008 and July 2009, according to a December release by the Census Bureau. "New homes are still being built and people are still moving into these homes" in Texas, says Martin.
Part of the state's strength, says Mark Mather, a demographer at the Population Reference Bureau in Washington, D.C., is its diversified economy. Main industries include petroleum refining, chemical production, aerospace, and information technology.
Meanwhile, areas that depended on the housing boom are now dealing with high foreclosure rates. Places such as Summerlin South, Nev., which appear in Bloomberg BusinessWeek's slide show of fast-growing cities, gained population but, like the rest of the state, may be dealing with high mortgage default rates.
"If you live by migration, you also die by migration," says Kenneth Johnson, senior demographer at the University of New Hampshire's Carsey Institute. "It doesn't guarantee continued growth."
New Business Opportunities
Migration is typically highest among people in their 20s seeking jobs near large urban cores, but employment opportunities are not the only draw. "Amenities are also important in migrational decisions," says Johnson. Many families consider factors such as schools and recreational amenities like scenic areas and parks.
This is a consideration now in Spring Hill, Tenn., which gained 7,645 households since 2000 as many young families moved to the town for affordable housing and work at the General Motors plant, which is now idle. Dustin Dunbar, chairman of the Spring Hill Economic Development Commission, says this has created demand and opportunity for businesses that provide youth activities and entertainment. "We hope to recruit some businesses to cater to our largest demographics," he says.
While migration in 2010 may remain sluggish, "we'll see a continuation of urban sprawl once the economy bounces back," says Mather.
Fastest Growing Cities by State
Arizona: Buckeye
Number of households: 18,112
Pct. Chg: +10% since 2008 (+261% since 2000)
Average household income: $52,927 (–6% since 2000)
Why: Buckeye is one of the fastest-growing suburbs in Arizona and has seen a large influx of Asian residents, especially Vietnamese, according to Gadberry. While many new housing units are planned, the price of real estate in Buckeye has dropped nearly 12% since 2008, according to Trulia, and thousands of properties are in the foreclosure process.
California: Lincoln
Number of households: 21,997
Pct. Chg: +10% since 2008 (+250% since 2000)
Average household income: $90,608 (+16% since 2000)
Why: Lincoln, a suburban development 30 miles from Sacramento, is the fastest-growing suburb of California and the third fastest-growing town in the U.S. New office buildings, shopping centers, housing developments, and custom home properties have gone up in recent years as a part of the local development plan, according to ZipRealty.
Georgia: Braselton
Number of households: 13,929
Pct. Chg: +8% since 2008 (+118% since 2000)
Average household income: $113,664 (+67% since 2000)
Why: Gadberry Group noted Braselton, a suburb of Atlanta, as a remarkable high-growth area due to increases not only in population, but also average income and average household net worth ($532,628). Companies operating here such as Sears Logistics, Tractor Supply, Mitsubishi, and Progressive Lighting have helped to generate jobs.
Indiana: Avon
Number of households: 11,521
Pct. Chg: +8% since 2008 (+73% since 2000)
Average household income: $97,355 (+35% since 2000)
Why: Avon has experienced rapid growth since the 1990s due to its convenient location 10 miles from Indianapolis, where health care, social services, and education are the leading industries, according to Simply Hired.
Iowa: Urbandale
Number of households: 16,402
Pct. Chg: +8% since 2008 (+44% since 2000)
Average household income: $93,655 (+12% since 2000)
Why: Urbandale, within an hour's drive from Kansas City and Minneapolis, has a lower unemployment rate than the national average. The insurance and finance industries are major employers.
North Carolina: Wake Forest
Number of households: 17,803
Pct. Chg: +8% since 2008 (+118% since 2000)
Average household income: $82,771 (+18% since 2000)
Why: Not far from the Raleigh-Durham-Chapel Hill Triangle, Wake Forest has attracted residents with excellent quality of life, public schools, and health-care resources. Gadberry also notes the high percentage of children and ethnic diversity here.
South Carolina: Fort Mill
Number of households: 10,474
Pct. Chg: +8% since 2008 (+91% since 2000)
Average household income: $72,090(+23% since 2000)
Why: Companies such as Continental Tire and music distributor Muzak are located in Fort Mill, near Rock Hill, S.C., and Charlotte, N.C. While many financial companies moved into the area during the housing boom, they have mostly pulled out, reported The Wall Street Journal.
Tennessee: Spring Hill
Number of households: 11,814
Pct. Chg: +10% since 2008 (+183% since 2000)
Average household income: $92,347 (+44% since 2000)
Why: Spring Hill saw the fourth-largest increase in number of households on Gadberry's list, driven largely by the jobs created by GM's plant, which manufactured Saturn vehicles until 2008, when it started making the GM Traverse.
Texas: Atascocita
Number of households: 23,917
Pct. Chg: +8% since 2008 (+108% since 2000)
Average household income: $99,272 (+26% since 2000)
Why: Atascocita, 18 miles from Houston, boasts golf courses and country clubs. Residents can also boat and fish in nearby Lake Houston, a manmade lake. According to Gadberry, the number of Hispanic households increased by 278% since 2000, making it the largest-growing segment of the population.
Utah: South Jordan
Number of households: 13,622
Pct. Chg: +9% since 2008 (+82% since 2000)
Average household income: $108,300 (+37% since 2000)
Why: Development in this city, 10 miles from Salt Lake City, was fueled by the availability of land and large lots, planned communities, and a charming rural atmosphere. The new Daybreak Community development is expected to attract many more residents.
Tired of reading about how rotten the real estate market is? Here's some good news that shows that even during the worst of the recession plenty of American cities, towns, and suburbs continue to grow.
One such place is Atascocita, Tex. A mostly residential community 20 miles from Houston, it gained more than 1,800 households in 2009, an 8% year-over-year increase, according to new data from Little Rock-based data firm Gadberry Group. Over the decade, amenities that have helped attract residents to this wooded locale include Lake Houston, just east of the city; the school district; and proximity to the city of Houston. With new roads in the area under construction, "we're starting to see major industry start to take a look at the area," says Mike Byers, president of the Lake Houston Area Chamber of Commerce.
Migration levels nationwide stayed low last year as homeowners saddled with pricey mortgages stayed put--but there are some positive trends. Research by the Gadberry Group shows that some areas, resisting the effects of the recession, continue to attract both domestic and foreign migrants and, as an effect, bring in new businesses to provide services. While other cities across the U.S. have contracted, these have continued to grow.
Some states are better off than others, though. As thousands of people left places such as New Orleans and Flint, Mich. (the country's two fastest-shrinking cities), in the last decade, communities with the best mix of economic activity, proximity to job centers, and a good environment for families continued to grow. While not entirely spared by the economic downturn (some homes in these areas are now in foreclosure), people continued to move in during 2009.
Texas Grew the Most
Texas came out on top of Gadberry's survey, with four high-growth cities: Atascocita, Katy, Mansfield, and Wylie. The report only included areas larger than 10,000 occupied households that met requirements for growth rate, household income, length of residence, and other factors.
Larry Martin, principal of the Gadberry Group, says many of the places with the biggest housing growth at the beginning of the last decade, such as Nevada, Florida, and Arizona, also saw the biggest drop-off since the economy sank. Texas, however, enjoyed relatively strong housing and job markets over the last 10 years, thanks in large part to the presence of major employers in the robust energy business. As of December, the state unemployment rate was 8.3% (lower than the national rate of 10%), according to data from the Bureau of Labor Statistics. It also had the largest state population growth between July 2008 and July 2009, according to a December release by the Census Bureau. "New homes are still being built and people are still moving into these homes" in Texas, says Martin.
Part of the state's strength, says Mark Mather, a demographer at the Population Reference Bureau in Washington, D.C., is its diversified economy. Main industries include petroleum refining, chemical production, aerospace, and information technology.
Meanwhile, areas that depended on the housing boom are now dealing with high foreclosure rates. Places such as Summerlin South, Nev., which appear in Bloomberg BusinessWeek's slide show of fast-growing cities, gained population but, like the rest of the state, may be dealing with high mortgage default rates.
"If you live by migration, you also die by migration," says Kenneth Johnson, senior demographer at the University of New Hampshire's Carsey Institute. "It doesn't guarantee continued growth."
New Business Opportunities
Migration is typically highest among people in their 20s seeking jobs near large urban cores, but employment opportunities are not the only draw. "Amenities are also important in migrational decisions," says Johnson. Many families consider factors such as schools and recreational amenities like scenic areas and parks.
This is a consideration now in Spring Hill, Tenn., which gained 7,645 households since 2000 as many young families moved to the town for affordable housing and work at the General Motors plant, which is now idle. Dustin Dunbar, chairman of the Spring Hill Economic Development Commission, says this has created demand and opportunity for businesses that provide youth activities and entertainment. "We hope to recruit some businesses to cater to our largest demographics," he says.
While migration in 2010 may remain sluggish, "we'll see a continuation of urban sprawl once the economy bounces back," says Mather.
Fastest Growing Cities by State
Arizona: Buckeye
Number of households: 18,112
Pct. Chg: +10% since 2008 (+261% since 2000)
Average household income: $52,927 (–6% since 2000)
Why: Buckeye is one of the fastest-growing suburbs in Arizona and has seen a large influx of Asian residents, especially Vietnamese, according to Gadberry. While many new housing units are planned, the price of real estate in Buckeye has dropped nearly 12% since 2008, according to Trulia, and thousands of properties are in the foreclosure process.
California: Lincoln
Number of households: 21,997
Pct. Chg: +10% since 2008 (+250% since 2000)
Average household income: $90,608 (+16% since 2000)
Why: Lincoln, a suburban development 30 miles from Sacramento, is the fastest-growing suburb of California and the third fastest-growing town in the U.S. New office buildings, shopping centers, housing developments, and custom home properties have gone up in recent years as a part of the local development plan, according to ZipRealty.
Georgia: Braselton
Number of households: 13,929
Pct. Chg: +8% since 2008 (+118% since 2000)
Average household income: $113,664 (+67% since 2000)
Why: Gadberry Group noted Braselton, a suburb of Atlanta, as a remarkable high-growth area due to increases not only in population, but also average income and average household net worth ($532,628). Companies operating here such as Sears Logistics, Tractor Supply, Mitsubishi, and Progressive Lighting have helped to generate jobs.
Indiana: Avon
Number of households: 11,521
Pct. Chg: +8% since 2008 (+73% since 2000)
Average household income: $97,355 (+35% since 2000)
Why: Avon has experienced rapid growth since the 1990s due to its convenient location 10 miles from Indianapolis, where health care, social services, and education are the leading industries, according to Simply Hired.
Iowa: Urbandale
Number of households: 16,402
Pct. Chg: +8% since 2008 (+44% since 2000)
Average household income: $93,655 (+12% since 2000)
Why: Urbandale, within an hour's drive from Kansas City and Minneapolis, has a lower unemployment rate than the national average. The insurance and finance industries are major employers.
North Carolina: Wake Forest
Number of households: 17,803
Pct. Chg: +8% since 2008 (+118% since 2000)
Average household income: $82,771 (+18% since 2000)
Why: Not far from the Raleigh-Durham-Chapel Hill Triangle, Wake Forest has attracted residents with excellent quality of life, public schools, and health-care resources. Gadberry also notes the high percentage of children and ethnic diversity here.
South Carolina: Fort Mill
Number of households: 10,474
Pct. Chg: +8% since 2008 (+91% since 2000)
Average household income: $72,090(+23% since 2000)
Why: Companies such as Continental Tire and music distributor Muzak are located in Fort Mill, near Rock Hill, S.C., and Charlotte, N.C. While many financial companies moved into the area during the housing boom, they have mostly pulled out, reported The Wall Street Journal.
Tennessee: Spring Hill
Number of households: 11,814
Pct. Chg: +10% since 2008 (+183% since 2000)
Average household income: $92,347 (+44% since 2000)
Why: Spring Hill saw the fourth-largest increase in number of households on Gadberry's list, driven largely by the jobs created by GM's plant, which manufactured Saturn vehicles until 2008, when it started making the GM Traverse.
Texas: Atascocita
Number of households: 23,917
Pct. Chg: +8% since 2008 (+108% since 2000)
Average household income: $99,272 (+26% since 2000)
Why: Atascocita, 18 miles from Houston, boasts golf courses and country clubs. Residents can also boat and fish in nearby Lake Houston, a manmade lake. According to Gadberry, the number of Hispanic households increased by 278% since 2000, making it the largest-growing segment of the population.
Utah: South Jordan
Number of households: 13,622
Pct. Chg: +9% since 2008 (+82% since 2000)
Average household income: $108,300 (+37% since 2000)
Why: Development in this city, 10 miles from Salt Lake City, was fueled by the availability of land and large lots, planned communities, and a charming rural atmosphere. The new Daybreak Community development is expected to attract many more residents.
Honda sets own recall as Toyota details action
TOKYO/PARIS (Reuters) – Toyota said its global safety withdrawal would take up to 1.8 million vehicles off Europe's roads and rival Honda announced its own recall, placing the vaunted pedigree of Japan's carmakers under fresh scrutiny.
The move by Honda, tipped to benefit from Toyota's woes, came as suppliers, consumers and analysts weighed the financial impact on Toyota of its recall and its suspension of U.S. sales.
Investors also assessed the fall-out for an industry just emerging from global crisis as well as the damage to Japanese automakers' prized reputation for safety and reliability.
"It's not that their vehicles are worse than the others, (the recalls are) just showing maybe that their vehicles are like the others," said IHS Global Insight analyst Carlos Da Silva.
"The race to cost cuts and the competition between all brands is so fierce that even the mighty Japanese are doing things that are not as reliable as they were."
In a rare piece of positive news for Toyota, a source told Reuters that its U.S. sales could resume by the third week in February if a remedy to potentially sticking accelerator pedals was rolled out smoothly.
BENEFITS
Barclays Capital analysts still thought Honda would benefit from Toyota's massive recall, while Ford, GM, Hyundai and Nissan Motor Co also stood to gain market share in the short-term.
Toyota, the world's biggest carmaker, this week suspended North American sales and production of eight models and widened its recall to China and Europe, bringing the total to around 8 million units, more than the number of cars and trucks it sold worldwide in 2009.
Toyota said Friday it would recall eight models in Europe, totaling as many as 1.8 million units in Europe.
A Toyota spokeswoman said the company was still checking on whether any vehicles in Latin America, the Middle East and Africa had an accelerator problem.
Honda said it would recall 646,000 of its Fit/Jazz and City models, including 140,000 in the United States, because of a faulty window switch, after a child died when fire broke out in a car last year.
In an unusual move, House Energy and Commerce Committee Chairman Henry Waxman said the panel would investigate how effectively Toyota responded to concerns about sticking pedals and slipping floormats.
KNOCK-ON EFFECTS
In Tokyo, some worried about the effects on Japan's image and economy.
"If Toyota has hard times, there's a high probability that also Japan will," said Takeo Namekata, a 62-year-old office worker. "Particularly, trade will suffer."
Suppliers were expected to see some fallout.
"If Toyota gets the flu, its suppliers will also be sneezing," said Kevin Chen, president of Gasgoo.com, a major Chinese auto parts trading platform.
International component makers were most at risk, said Tatsuya Mizuno, president of Mizuno Credit Advisory, because it might encourage Toyota to switch to Japanese suppliers, he told Reuters Insider television.
Analysts have estimated the sales halt could cost Toyota at least 50 billion yen ($556 million) in operating profit a month, almost as much as it made in the September quarter.
SAFETY REPUTATION
IHS Global Insight's Da Silva said Japanese carmakers would be able to salvage their reputations as long as they moved quickly to show the recalls were isolated incidents.
Recalls can show companies care about the cars they build, and don't simply wash their hands of them once they are driven away from the showroom, he added.
Toyota shares have dropped 17.6 percent since January 21, when it said it would broaden its recalls by a further 2.3 million vehicles. Shares ended down 2 percent in Tokyo Friday.
Industry analysts and executives estimate it will cost some $250 million in warranty costs alone for Toyota to address the smaller of the two recalls underway in the United States.
The automaker also faces the fallout from the larger recall that began last year and was broadened this week for vehicles at risk of having floormats that can jam under accelerator pedals.
(Additional reporting by Bernie Woodall, Soyoung Kim, Kevin Krolicki in Detroit; Chang-Rang Kim and Taiga Uranaka in Tokyo; Janaki Krishan in Mumbai; Fang Yan in Shanghai; Tiisetso Motsoeneng in Johannesburg; Rhys Jones in London and Helen Massy-Beresford in Paris; Editing by David Cowell)
The move by Honda, tipped to benefit from Toyota's woes, came as suppliers, consumers and analysts weighed the financial impact on Toyota of its recall and its suspension of U.S. sales.
Investors also assessed the fall-out for an industry just emerging from global crisis as well as the damage to Japanese automakers' prized reputation for safety and reliability.
"It's not that their vehicles are worse than the others, (the recalls are) just showing maybe that their vehicles are like the others," said IHS Global Insight analyst Carlos Da Silva.
"The race to cost cuts and the competition between all brands is so fierce that even the mighty Japanese are doing things that are not as reliable as they were."
In a rare piece of positive news for Toyota, a source told Reuters that its U.S. sales could resume by the third week in February if a remedy to potentially sticking accelerator pedals was rolled out smoothly.
BENEFITS
Barclays Capital analysts still thought Honda would benefit from Toyota's massive recall, while Ford, GM, Hyundai and Nissan Motor Co also stood to gain market share in the short-term.
Toyota, the world's biggest carmaker, this week suspended North American sales and production of eight models and widened its recall to China and Europe, bringing the total to around 8 million units, more than the number of cars and trucks it sold worldwide in 2009.
Toyota said Friday it would recall eight models in Europe, totaling as many as 1.8 million units in Europe.
A Toyota spokeswoman said the company was still checking on whether any vehicles in Latin America, the Middle East and Africa had an accelerator problem.
Honda said it would recall 646,000 of its Fit/Jazz and City models, including 140,000 in the United States, because of a faulty window switch, after a child died when fire broke out in a car last year.
In an unusual move, House Energy and Commerce Committee Chairman Henry Waxman said the panel would investigate how effectively Toyota responded to concerns about sticking pedals and slipping floormats.
KNOCK-ON EFFECTS
In Tokyo, some worried about the effects on Japan's image and economy.
"If Toyota has hard times, there's a high probability that also Japan will," said Takeo Namekata, a 62-year-old office worker. "Particularly, trade will suffer."
Suppliers were expected to see some fallout.
"If Toyota gets the flu, its suppliers will also be sneezing," said Kevin Chen, president of Gasgoo.com, a major Chinese auto parts trading platform.
International component makers were most at risk, said Tatsuya Mizuno, president of Mizuno Credit Advisory, because it might encourage Toyota to switch to Japanese suppliers, he told Reuters Insider television.
Analysts have estimated the sales halt could cost Toyota at least 50 billion yen ($556 million) in operating profit a month, almost as much as it made in the September quarter.
SAFETY REPUTATION
IHS Global Insight's Da Silva said Japanese carmakers would be able to salvage their reputations as long as they moved quickly to show the recalls were isolated incidents.
Recalls can show companies care about the cars they build, and don't simply wash their hands of them once they are driven away from the showroom, he added.
Toyota shares have dropped 17.6 percent since January 21, when it said it would broaden its recalls by a further 2.3 million vehicles. Shares ended down 2 percent in Tokyo Friday.
Industry analysts and executives estimate it will cost some $250 million in warranty costs alone for Toyota to address the smaller of the two recalls underway in the United States.
The automaker also faces the fallout from the larger recall that began last year and was broadened this week for vehicles at risk of having floormats that can jam under accelerator pedals.
(Additional reporting by Bernie Woodall, Soyoung Kim, Kevin Krolicki in Detroit; Chang-Rang Kim and Taiga Uranaka in Tokyo; Janaki Krishan in Mumbai; Fang Yan in Shanghai; Tiisetso Motsoeneng in Johannesburg; Rhys Jones in London and Helen Massy-Beresford in Paris; Editing by David Cowell)
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