Toyota counts on veteran to do rescue damaged image at Congressional hearing

Toyota counting on veteran at Congress hearing

TOKYO — Toyota is counting on a trusted veteran with ample U.S. experience, Yoshimi Inaba, when the Japanese automaker’s recall problems are scrutinized by Congress later this week.

Inaba, 63, a sales expert, was hand-picked from semiretirement by Toyota Motor Corp. President Akio Toyoda last year to head the North American operations and help steer Toyota through the company’s biggest earnings slump in its 72-year history as global auto sales dived.

Now he must explain a spate of safety problems — first with floor mats that could entangle the gas pedal, followed by a design flaw that could cause a depressed gas pedal to get stuck — covering more than 7 million vehicles worldwide.

The quality woes have spread to the Prius, the world’s top-selling hybrid car and a symbol of Toyota’s technological prowess. There have been dozens of complaints in Japan and the U.S. of a short delay before the brakes kick in.

Inaba will appear before the U.S. House Committee on Oversight and Government Reform on Wednesday along with Transportation Secretary Ray LaHood and National Highway Traffic Safety Administration Administrator David Strickland. The name of the hearing: “Toyota Gas Pedals: Is the Public at Risk?”

Inaba, who has a master’s in business administration from Northwestern University’s Kellogg School of Business, faces the enormous challenge of assuaging public alarm about what has gone wrong at the manufacturer.

Toyota reiterated Monday that a fix on the 2010 Prius was coming soon, but declined to give details.

Japanese media reported it will be a recall in Japan — higher in urgency than the euphemistic-sounding “safety campaign,” which is used to bring in cars for upgrades.

The braking problem can be fixed with new software, which is already in Prius cars that went on sale since last month, according to Toyota.

More than 100 complaints have been reported in the U.S. over Prius braking, and four crashes and two minor injuries are suspected as related to the braking problems, according to the U.S. government. Lingering doubts also remain that gas pedal defects may be electronic, not mechanical as Toyota has said.

Experts say Inaba, who headed Toyota’s U.S. sales unit from 1999 until 2003, will need to do a far better job fielding questions in English than did his boss Toyoda when the automaker’s president held his first news conference since the gas pedal recall was announced on Jan. 21.

“The real reckoning will come on Wednesday,” Paul Argenti, Professor of Corporate Communication at Tuck School of Business at Dartmouth, said of the Congressional hearing, which was set up last month.

“The question will be what kind of responsibility they take when they come under fire with Congress. The jury is still out. This is the kind of stuff that can bring a company down,” he said.

Argenti advises Inaba to stay humble, own up to mistakes, show a convincing plan for a fix and woo customers with discounts and free maintenance service for some years. Toyota may require many years to put the recall problems behind it and rebuild its brand, he said.

Inaba, who joined Toyota in 1968, started out in its sales unit and later worked for five years in Toyota’s European division. He left in 2007 to run an international airport in Nagoya, near Toyota city.

He was brought back in 2009 as president of Toyota Motor North America Inc. in one of Toyoda’s first decisions as president.

Toyota did not respond to requests from The Associated Press for interviews with Inaba.

Masaaki Sato — who has written books on Toyota, and has been critical of Toyoda taking too long to publicly address the safety concerns — has no doubt Inaba can do better.

“He will probably do a perfectly tactful job, although he is no engineering expert,” Sato said. “He is familiar with American ways.”

Toyoda was criticized in Japan for not having a prepared statement in English when he appeared at a hastily called news conference Friday evening to apologize for the recalls — about half of which are in North America. Though known to be a competent speaker, his replies to questions in English were brief and cursory.

Toyoda, grandson of the automaker’s founder, once headed the Fremont, California, joint venture Toyota had with General Motors Co. and has a master’s degree in business administration from Babson College in Massachusetts.

Crisis management experts say the message from the top executive is crucial for companies to ride out public relations fiascos. But major Japanese companies, like Toyota, have layers of bureaucracy that can slow down decision-making.

The companies have dozens of public relations experts but many lack Western-style crisis-management expertise.

In an English statement later added on the company Web page, Toyoda said: “I, Akio Toyoda, deeply regret the inconvenience and concern caused to our customers and others.”

The automaker recently retained Quinn Gillespie & Associates, a well connected, bipartisan lobbying and public affairs firm that will help Toyota try to contain the damage in Washington, the AP has learned. On its Web site, the firm promises to “limit damage to reputation.”

The AP also has learned that Toyota has retained The Glover Park Group, a Democratic public affairs lobbying firm, for crisis management.

Experts in Japan have been puzzled at Toyota’s muddled response, including how Toyota executives dispensed with the customary deep bow — which is meant to show contrition — at the news conference.

Toyota’s U.S. communications machinery may have been better oiled in the past.

Jim Press, who worked 37 years at Toyota before being appointed — with much fanfare — the first non-Japanese on the board in 2007, quit just three months later to become president and vice chairman of Chrysler LLC.

“I don’t see Toyota making any concessions to the customer. There’s not enough humility, not enough ‘Thank you for sticking with us, and here is a freebie for you’ — the kinds of things you would expect a company to be doing when they are under siege,” Argenti said.

Associated Press Writer Sharon Theimer in Washington contributed to this report.