COMMENTARY: Costs, Congress and Toyota's Fall from Grace
By Michelle Krebs February 12, 2010My boss reckons one consequence of Toyota Motor Corp.'s new and extraordinary quality-safety blunders is that the price of new cars is going to go up.
Edmunds.com CEO Jeremy Anwyl suggests in a piece posted Thursday on AutoObserver that consumers should prepare themselves to pay for the increased safety the furor over the Toyota revelations seems to be demanding. And they will likely have to pay for the correspondingly amped-up regulatory oversight that also will be an inevitable outcome once Washington gets involved at the end of the month.
Our vehicles have become astoundingly, statistically safe. The question of the moment is: are we willing to pay whatever's required to move them closer to being absolutely safe?
Diesel engines that reduce our dependence on foreign oil would be a wonderful thing for consumers and the country to embrace, but the automakers' constant refrain is that customers won't pay for diesels - despite the direct and measurable benefit of better fuel economy.
So who would expect a car buyer to pay for even more safety - and the regulatory system to ensure it - when safety offers a direct benefit only on the rare occasion something bad happens?
The answer is the one that prevails in all facets of the nanny-state mindset: people will pay to be protected as long as they don't really think they are paying.
Safety Sells - And Costs
When the extent of Toyota's accelerator-pedal mis-engineering became known, one obvious analogue was the most recent auto-safety debacle of similar high profile: the scare when Firestone tire-wearing versions of Motor Co.'s Explorer began to show a propensity to roll over.
Few stayed interested long enough, however, to evaluate the Ford-Firestone recall's most lasting effect on us all: higher prices for cars.
After Ford-Firestone, the National Highway Traffic Safety Administration - the regulatory agency likely to be sharing Toyota's hot seat later this month - made tire-pressure-monitoring systems mandatory. Not because the systems do something a human can't do, but because the systems do something a human won't do.
Tire-pressure monitoring costs money. You're paying it.
Another safety-equipment mandate connected to Ford-Firestone: electronic stability control systems, sometimes called "rollover protection." It was determined electronic stability control might have prevented many of the Explorer rollovers and a couple of subsequent, convincing studies proved the effectiveness of stability control.
The systems are NHTSA-required as standard equipment by 2012. Stability control costs money. You already are or will be paying it.
Seatbelts, airbags, shift interlocks. All mandated safety items that provide incremental new levels of safety. They all cost money. You're paying it.
But where should it stop? Driving in an intrinsically risky behavior. Is it economically practical to insist every potential hazard be addressed by a safety system and each of the thousands of parts - or software - on a car be guaranteed to be utterly infallible?
Where From Here?
Toyota's fall from grace is going to cost us all. So we might as well make the best of it.
In the case of the faulty accelerator pedals, maybe Toyota was deliberately, corporate-culture-led negligent (or profiteering) in its engineering, testing or quality control. Maybe not. Maybe there are other, more insidious engineering- or management-related answers. Hearings in Washington, starting with the House of Representatives on Feb. 24, will purport to find out. Expect results to be inconclusive.
Here's what will come out of the Toyota hearings:
1. The "Duh" decision.
Some type of electronic watchdog to cut engine power if the accelerator and brake are simultaneously applied will be mandated. Ironically, the same software many suspect to be at the root of Toyota's current troubles will be the inevitable solution.
2. A NHTSA spanking, followed by a reward.
Was NHTSA a little too friendly with a company it's charged with overseeing? Almost certainly. The agency will claim lack of resources and lack of expertise prevented it from flagging Toyota's evidence.
The end result of NHTSA's ineffectiveness, though, will be the agency's enlargement. Some good might come of this if the expansion enables a new triage-like structure assigned to each automaker to monitor and intelligently evaluate the multitude of consumer complaints NHTSA fields.
NHTSA might also do well to form specialized task forces stocked with real auto and electronics engineers to continually study new technologies, trends and advances. Strong ties between truly informed and impartial research engineers and NHTSA's political "implementers" would improve NHTSA's performance - provided the engineers have genuine authority within the agency.
A Greater Good
Meanwhile, here's the larger good we'd like to see derived from Toyota's Congressional come-uppance:
1. The results of the hearings should point to the need to get special interest - i.e. the insurance industry - out of auto safety. Any entity with an economic interest should not be a part of the regulatory process or conversation. Just like insurance industry shouldn't be calling the shots about your health, it shouldn't be able to influence the direction of automotive development.
More bluntly: we'd all do just fine without the Insurance Institute for Highway Safety.
2. Wouldn't it be marvelous if the run-up to the hearings fuels the populist mood to force increasingly conflicted lawmakers to recuse themselves from proceedings in which they have an interest?
Most citizens in my home state of West Virginia view our Democratic senator, Jay Rockefeller, as a decent man and a dedicated and loyal politician. He's always seemed so to me. Honorable though he likely is, Rockefeller - who's openly nurtured a decades-long relationship with Toyota - absolutely has no business being anywhere near the District of Columbia when the Senate's Commerce, Science and Transportation Committee, which he chairs, starts asking questions of Toyota on March 2.
Other lawmakers serving on the investigative committees have ties to Toyota that are similarly indefensible in this context. Here's the chance for Americans to insist our politicos, progressively more defiant in their ethical tone-deafness, re-establish some standards of impartiality. If there's going to be a witch hunt, the witch's BFFs shouldn't be in charge of the torches. - Bill Visnic, Senior Editor
LEAVE A COMMENT
There has been more public scrutiny of the government in the past 5 years than there ever has in the previous 30+. Not since the 60's has there been such public outcry for responsibility from Congress. So while we talk about the "unicorns and fairies" discussions continue, these kinds of things might just happen. There's a lot of hostility out there and Congressional leaders are slowly becoming aware of it. And no, I am in no way affiliated with the "Tea Party" or Sarah Palin.
Diesel fuel stinks and lots of people (like my wife) have allergies and are sensitive to the fumes (get some on your hand or shoe while fueling and enjoy that lovely smell all day). The engines are so efficient, people up north can't get warm in their cars in the winter. And unlike Europe, we don't have a cadre of diesel mechanics familiar with working on them.
While we are spending money to make our cars safer, a good percentage should be directed toward driver's education.
Mr. Visnic, you are way off the mark when it comes to the important contributions to vehicle safety that have come about because of the Insurance Institute for Highway Safety's tests anc research. I am a senior staffer with the Institute and have been employed by them for over 30 years. Speaking for myself and not the Institute, I'm proud of what IIHS has accomplished. Sure, safety features add costs, but there are tremendous benefits in lives saved and injuries prevented.
Here's an appropriate op-ed from the February 11 Globe and Mail of Toronto:
You can thank U.S insurance group for our safer modern cars
By JEREMY CATO From Thursday's Globe and Mail
"We've come very far, very fast in just the past decade. When the institute began conducting frontal tests for consumer information in 1995, few vehicles earned top ratings. Now almost all do."
We've come a long way -at least when it comes to vehicle safety. And some might argue that government regulators -particularly Canadian government regulators -have had almost
nothing to do with it.
However, the Insurance Institute for Highway Safety (IIHS), a research group funded by the U.S. insurance industry, would likely be counted among those who have had a massive impact on vehicle safety.
While the U.S. government has been relatively slow in adopting increasingly stringent crash test standards, the IIHS has been raising the bar for a decade and a half. As for Canada, Transport Canada crash tests vehicles, but the results are kept secret.
Being secretive issomething quite foreign to the IIHS. By loudly publicizing the results of its crash tests and various other safety research findings; the IIHS has helped to push the auto industry to build stronger, more robust vehicles, and to add highly useful safety devices such as airbags and electronic anti-skid technology.
Not only does the IIHS actively and aggressively disseminate the results of its safety tests, the institute isn't afraid to pick winners and losers.
"In safety terms, we've come very far, very fast in just the past decade," says IIHS president Adrian Lund. "When the institute began conducting frontal tests for consumer information in 1995, few vehicles earned top ratings. Now almost all do. Most cars failed the side tests we added in 2003.
"Test results in that initial round were so bad we nearly broke our budget for repairing the crash test dummy. But now most vehicles ace the side test thanks to side airbags and stronger side structures.
"Factor in improved head restraints to protect against whiplash and electronic stability control to prevent crashes, and consumers are the clear winners."
Lund and the IIHS say the near-wholesale adoption of critical safety gear as standard equipment on most new vehicles has had a huge impact on saving lives and reducing vehicle-accident injuries...
ADD A COMMENT