Re: Randy Berger My Answer to You About Nance

Posted by 58L8134 On 2010/2/4 8:50:55

Hi

In the auto business, two maxims apply: "Perception IS Reality" and "Nothing is more fragile than a reputation for high quality". Regardless of reality, these are the controlling factors. Rumors of quality problems spread like wildfire, just as those of financial distress and potential orphan status.

As complex and unfamiliar as the '55 models were, maintaining assembly operation as they were up to '54 would have gone a long way toward avoiding the situation that resulted in those quality problems. Plus, avoided the waste of $30 million to move into a crackerbox!

Apparently, they were able to overcome those challenges by indication of the existing cars. Still, better to avoid the potential problems in the first place. A damaged quality reputation is very difficult to repair, Toyota is about to find out how difficult!

Steve