So what does everybody think of the Toyota recall?

ladder13 said:
I already did, a Rav4 built in America by Americans.;)
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And more than half the US dollars you paid for it was forever drained from the US economy and injected into the Japanese economy.

Including the multiplyer effect, the total impact on the US economy amounts to a negative impact of about 4 times the total purchase price of the product sold by a foreign owned company.
 
m1gunner said:
And more than half the US dollars you paid for it was forever drained from the US economy and injected into the Japanese economy.

Including the multiplyer effect, the total impact on the US economy amounts to a negative impact of about 4 times the total purchase price of the product sold by a foreign owned company.
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I own an International truck built by Navistar, and American company based in Chicago, IL. My truck was built in Canada. I used to drive a Freightliner, which was built in Mexico. Volvos are built in the US, but they are a foreign company. The engine in my Ford pickup, IIRC, was assembled in Mexico.

We live in a global economy. There is no vehicle you can buy that is 100% assembled in the US, using 100% US parts, buy a US company. Not one.
 
The Big D said:
BRAKES WILL STOP A VEHICLE. ENGINE SHUTDOWN AND NEUTRAL HELP, ALSO.

How To Deal With Unintended Acceleration - Tech Dept. - Auto Reviews - Car and Driver

Car and Driver magazine article proves the point.

It is my opinion that driver error is, by far, the leading cause of the Toyota "problems." Driver stupidity contributes, too.

Be safe.
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this article does not take into account the reality of drive by wire in the face of a highly probable computer lockup (floor mat my eye)
the shift linkage is whole or in part replaced by a wiring harness. if this is a system failure ... shift to neutral will mean nothing cause it does nothing.
Ignition also answers to the computer. go ahead .. try it, if its a programming error in effect ... it too means nothing.
it is very similar to a hung PC .. ctrl+alt+delete fails ... thats it, no input gets through
 
m1gunner said:
And more than half the US dollars you paid for it was forever drained from the US economy and injected into the Japanese economy.

Including the multiplyer effect, the total impact on the US economy amounts to a negative impact of about 4 times the total purchase price of the product sold by a foreign owned company.
Click to expand...


with respect, I think that statement is flawed by some manufacturers.

I have personally been thru the Honda plants in Ohio. They cast and machine the engines and parts, stamp body parts, paint, assemble, ship, all from right there.

So explain to me how lots and lots of money goes back to Japan.

Please be specific.
 
And by buying a made in Mexico or made in Canada vehicle, how am I helping the American economy? The wages stay in those countries, the workers shop and eat in those countries. Does Ford ,GM or Chrysler pay Mexicans the same wages as US auto workers? If not, why not? Why don't they pass the savings onto US consumers? If those "American" car companies cared about US workers and families they'd produce those cars here.
As truckemup says, name one 100% made in America car, with 100% parts manufactured and assembled here.
Toyota Sequioa is made from 80% US parts. The Jeep Patriot :rolleyes::o , no less, is made from 65% American parts.
http://www.google.com/url?sa=t&sour...pKGADg&usg=AFQjCNGOKiMhkMmKp_OGBHfNK4KSgaCwRw
 
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I think the government is attacking Toyota. They had a problem and are trying to fix it.

At present, I drive a Ford F350 and wife has a Doge 1500, both 4x4. When we replace one of these, it most likely will be with a Toyota. It will not be a GM or Doge.
 
roundgunner said:
with respect, I think that statement is flawed by some manufacturers.

I have personally been thru the Honda plants in Ohio. They cast and machine the engines and parts, stamp body parts, paint, assemble, ship, all from right there.

So explain to me how lots and lots of money goes back to Japan.

Please be specific.
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Ill take a crack at this referencing a gentler time of the 70's
at the time ... total materials bill was all of $500 in any given vehicle .... it sold at the lot for around 7000
thats a multiple of 14 times materials, or 6.5 kilobucks gross profit. Of this, about 500 was likely gathered by the dealer leaving 6 kilobucks ... of that figure 10% or 600 bucks per unit was labor and operating cost.
now we are down to 5400 ... this goes to the company ..... wherever its headquarters may be ... foreign or domestic.
thats quite a chunk of payolah going ... somewhere
 
Mitsubishi made very reliable Japanese Zero war planes, 328 attacked US soil and killed over 2300 Americans. Recall??? That's a fact that I recall and will not forgive or forget.
 
Some Fords use Mazda transmissions, like my old Explorer. The Ford was assembled in Mexico, maybe should have been called Fexican.
 
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I bought an American car, a 2000 Subaru Outback Wagon, currently with 126K on the clock and it's given me no reason to even think of replacing it.

Yes, American, by my definition: Built in Lafayette, IN by Americans, with 91% domestic parts content (USA, Not "north America"), meaning that over 90% of the bits and pieces that went into the car were made by other Americans. Sure, some profit may go to Fuji Heavy Industries in Japan, but there may well be some of you or Americans you know or live near that made parts for my Outback. Those American-made parts were trucked to Lafayette, IN by American truck drivers, in trucks serviced by American mechanics . . .

This is the NEW definition of a 21st century American car company -- That which employs American workers, uses a high percentage of domestic parts, thus employing even more Americans in the supply chain.

Some years ago one of my neighbors, a staunch "Buy American" guy in the 1960s sense, bought a new Chevrolet pickup. He usually gives me grief a few times a year about owning "rice burners." A couple days after taking delivery of the Silverado he invited me across the street to look it over, and proudly proclaimed it to be "100% American." I opened the driver's door and pointed him to the sticker on the "B" pillar, which stated: Point of Assembly, Oshawa, ON.

IMO, that's not buying American, when Canadians benefit and any profit goes to a bloated, overhead-heavy, mismanaged, once-glorious example of American Business, General Motors, the company of which all of us US taxpayers own a piece.

JMO,

Noah
 
venomballistics said:
Ill take a crack at this referencing a gentler time of the 70's
at the time ... total materials bill was all of $500 in any given vehicle .... it sold at the lot for around 7000
thats a multiple of 14 times materials, or 6.5 kilobucks gross profit. Of this, about 500 was likely gathered by the dealer leaving 6 kilobucks ... of that figure 10% or 600 bucks per unit was labor and operating cost.
now we are down to 5400 ... this goes to the company ..... wherever its headquarters may be ... foreign or domestic.
thats quite a chunk of payolah going ... somewhere
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That may have been true in the 70s.

Clearly things have changed.

The laborers are all living in Ohio, they get their hair cut in Ohio, buy groceries in Ohio, have home deliveries by UPS in Ohio, paint the house with paint from Home Depot in Ohio, pay taxes in Ohio, buy furniture in Ohio, on and on in Ohio.

I do not have the current figures and it looks like nobody else does either, but I'm going to guess that most of the cost of manufacturing todays cars is labor.

The plants that truly build them here are better for the US than the ones that do almost everything outside the country but headquarters are here.
 
venomballistics said:
this article does not take into account the reality of drive by wire in the face of a highly probable computer lockup (floor mat my eye)
the shift linkage is whole or in part replaced by a wiring harness. if this is a system failure ... shift to neutral will mean nothing cause it does nothing.
Ignition also answers to the computer. go ahead .. try it, if its a programming error in effect ... it too means nothing.
it is very similar to a hung PC .. ctrl+alt+delete fails ... thats it, no input gets through
Click to expand...

You apparently did not read the article. Once again, BRAKES WILL STOP THE CAR.

Be safe.
 
roundgunner said:
with respect, I think that statement is flawed by some manufacturers.

I have personally been thru the Honda plants in Ohio. They cast and machine the engines and parts, stamp body parts, paint, assemble, ship, all from right there.

So explain to me how lots and lots of money goes back to Japan.

Please be specific.
Click to expand...

When it comes to the "cost of manufacture" of a piece of inventory (in this case an automobile) it has nothing to do with the "dealer cost" or invoice. Typically the dealer invoice is more than double what it actually costs in parts, labor and production facility expenses to produce that vehicle.

To keep the numbers easier to deal with, I will use 40% as an example (many vehicles' production costs are far less than this number).

It is generally agreed amoung US economists (both liberal and conservative) that money spent in the economy has an effect far greater than the actual dollar amount. What happens is the money gets re-spent a number of times till it is worn away by consumers' marginal propensity to save (they won't spend every cent they receive, they will save some). Money spent in the consumer market (as opposed to government spending) is normallyy respent 9 times (for this type of purchase the miltiplier effect is 9).

Take the Toyota that is built in Mudbank Mississippi. It is shipped to a dealer, and that dealer pays Toyota 20,000 bucks for it, the sticker has a MSRP of 23,500. The economy really stinks, so the dealer sells it at "cost" which is what he paid (20,000 bucks).

$12,000 of the money you gave the dealer is sent to Japan, it is forever removed from the US economy. The other $8,000 goes to Mudbank Miss, and gets distributed to the various employees, suppliers and contractors that supplied goods and services necessary to build that car (assuming all the parts were sourced in the US - not very likely)

So, your 20,000 dollars you initially spent had a potential economic stimulus of $180,000 to the US economy ended up only providing, at most, $72,000 worth of stimulus.

The situation reverses somewhat when a US manufacturer outsources his manufacturing. The example of the Ford made in Canada (or Mexico, or any other country). If production costs are significantly less for Ford to offshore their car production, their corporate profit is greater per unit than if that product were made in Detroit. This offsets to a degree the stimulus lost by paying foreign workers to build the cars. If sub-assemblies are US made, then the loss is less.

The Car company still earns their profit, but there is a big difference where that profit goes, and whose economy benifits from that profit.



Yes, this is a gross oversimplification, but the basic mechanics of the process is correct.


edit to add: sorry about using the "stimulus" word, it seems popular these days. "economic activity" can be substituted if you wish.
 
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The Big D said:
You apparently did not read the article. Once again, BRAKES WILL STOP THE CAR.

Be safe.
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true ... if you use them hard and unforgivingly before they smoke, boil the brake fluid and vapor lock. I suspect that some will tend to try the brakes, find they aren't as effective as they think they should be and set themselves up for a failure of the only system they have control of.
the article stated that this hit public focus when a police officer and his family were killed in a lexus ES350 with this problem. Id only assume that a cop would have some pursuit training that should have kept him and his alive ..... something is very wrong and we dont have the whole picture.
we cannot replicate the glitch, and we'de be nuts if we wanted to
 
m1gunner said:
When it comes to the "cost of manufacture" of a piece of inventory (in this case an automobile) it has nothing to do with the "dealer cost" or invoice. Typically the dealer invoice is more than double what it actually costs in parts, labor and production facility expenses to produce that vehicle.
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I would respectfully like to call BS on that idea. If you could assemble a car for $10,000, and your competition was selling it for $20,000, any businessman knows that you simply ramp up production and start selling them for $15,000. You're only making half the money on each vehicle, but you're selling three times as many. It's simple economics, and competition won't allow for such large profit margins on an item that expensive.
 
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gregintenn said:
In the incident involving the Prius yesterday, the repot I heard stated that the driver put the car into neutral and it still accelerated. I have never driven a Prius, but don't they have a transmission similar to a conventional car? I call BS!
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I suppose that maybe newer automatic transmissions are made to not shift at high speeds (as it would completely wreck the transmission to go from D to R or P). And perhaps it's also made not to shut off at high speeds, as a safety issue? These things may be contributing to the issue, if it is indeed a real one.

What they need is the fuel kill rod like on the old John Deere 4430 I used to drive. Manually shut off your engine at ANY time.

But honestly, electric over hydraulic can be a royal pain in the arse... Seriously, when it works, all is fine. But when it doesn't work, you'll rack your brain over it for hours (from a farming perspective, at least).

And it's the same thing that will cause an 8000 series John Deere with a bad fuel pump to become a 20 ton stationary roadblock (no manual release for the electronic parking brake).
 
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Vegetaman said:
I suppose that maybe newer automatic transmissions are made to not shift at high speeds (as it would completely wreck the transmission to go from D to R or P).
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ANY domestic vehicle with an automatic transmission can be shifted directly from D to N with a nudge of the selector; same for going from N to D. No foot on the brake, no other input the vehicle is necessary.

This is set up this way intentionally for safety reasons. People don't know it because they don't read owners' manuals, and don't use the feature when in an emergency because the instinctive reaction is to stomp on the brake.

Noah
 
truckemup97 said:
I would respectfully like to call BS on that idea. If you could assemble a car for $10,000, and your competition was selling it for $20,000, any businessman knows that you simply ramp up production and start selling them for $15,000. You're only making half the money on each vehicle, but you're selling three times as many. It's simple economics, and competition won't allow for such large profit margins on an item that expensive.
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No BS. Being a smart businessman and being a smart manufacturer are two different skill sets.

Manufacturing and retail sales are not related. Notice how virtually no manufacturer sells direct to the public? Vehicles (and all other retail products and services) are priced at what the market will bear. A KIA sells for a fraction of what a Lexus sells for, yet the cost to produce each isn't porportionally different.

These figures are available if one cares to do the research.

Manufacturing is one of only 2 ways a nation can create true wealth, the other being the selling of natural resources. This is why it is of utmost importance that we maintain out manufacturing base (and ownership of same). Other economic activity only moves wealth around, it creates nothing overall.
 
truckemup97 said:
m1gunner, if that is true, then why can't Chrysler and GM turn a profit?
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The primary reason is the method of accounting used (short answer).

There are huge overhead expenses being attached to these companies that have nothing to do with the actual cost of producing the product. Past contracts (which should have been nullified if a real bankruptcy proceeding was leagally followed) are still being honored and paid even though current economic situations have changed dramatically, and those antiquated contracts and agreements have nothing to do with current business or production.

To put it in local terms, imagine 2 gun dealers (this is a gun site, afterall) with identical stores sitting side by side. They both sell the exact same number of guns every year, same retail price and same wholesale price.

One dealer includes in his business costs a new F350 every year, a hunting plantation in the country (for demonstrating his product), and the tution to an expensive college for his twin sons who are his "CFO" and Executive Vice President respectively. These are listed as employee training costs.

The other shop owner is a sole proprietor that drives the same C10 pickup he has had for years.


One dealer is making a fortune, the other is losing his shirt. The difference is what is included as "business costs" by the respective dealers.

A secondary reason is the perceived value of the product turned out by the US manufactures mentioned and the foreign manufacturers. The American consumer has been told for years that US products are inferior to the foreign products. Right or wrong, this influences what the market will pay for each product. This is exactly why Toyota hid known defects for years as their production outstripped quality, and why they are putting up such a vigerous defense of their name brand.

Toyota can not afford to incur huge legacy expenses associated with having millions of defective products in consumers' hands and also doesn't want its image reduced to that of the Yugo, and the resulting drop in what consumers are willing to pay for their cars.

Tacking on legal and liability costs to future products could very well make it so Toyota can't make a profit either.

note: accounting proceedures do change from time to time. In the 80's (IIRC) all manufacturers were allowed to monitize pension funds. In essence they took the money set aside to fund the pensions and used it as operating funds for the corporation. These increased operating expenses of legacy corporations is nothing new, it has been building over time, and efforts in tha past have been made to address the problem, but the solution still hasn't been found. Even healthcare costs are figuring into this situation at an increasing rate.
 
The gov't is acting like the mob here, what's next taking over Coke and telling people Pepsi causes cancer? This whole thing is oderous.
 
m1gunner said:
When it comes to the "cost of manufacture" of a piece of inventory (in this case an automobile) it has nothing to do with the "dealer cost" or invoice. Typically the dealer invoice is more than double what it actually costs in parts, labor and production facility expenses to produce that vehicle.

To keep the numbers easier to deal with, I will use 40% as an example (many vehicles' production costs are far less than this number).

It is generally agreed amoung US economists (both liberal and conservative) that money spent in the economy has an effect far greater than the actual dollar amount. What happens is the money gets re-spent a number of times till it is worn away by consumers' marginal propensity to save (they won't spend every cent they receive, they will save some). Money spent in the consumer market (as opposed to government spending) is normallyy respent 9 times (for this type of purchase the miltiplier effect is 9).

Take the Toyota that is built in Mudbank Mississippi. It is shipped to a dealer, and that dealer pays Toyota 20,000 bucks for it, the sticker has a MSRP of 23,500. The economy really stinks, so the dealer sells it at "cost" which is what he paid (20,000 bucks).

$12,000 of the money you gave the dealer is sent to Japan, it is forever removed from the US economy. The other $8,000 goes to Mudbank Miss, and gets distributed to the various employees, suppliers and contractors that supplied goods and services necessary to build that car (assuming all the parts were sourced in the US - not very likely)

So, your 20,000 dollars you initially spent had a potential economic stimulus of $180,000 to the US economy ended up only providing, at most, $72,000 worth of stimulus.

The situation reverses somewhat when a US manufacturer outsources his manufacturing. The example of the Ford made in Canada (or Mexico, or any other country). If production costs are significantly less for Ford to offshore their car production, their corporate profit is greater per unit than if that product were made in Detroit. This offsets to a degree the stimulus lost by paying foreign workers to build the cars. If sub-assemblies are US made, then the loss is less.

The Car company still earns their profit, but there is a big difference where that profit goes, and whose economy benifits from that profit.



Yes, this is a gross oversimplification, but the basic mechanics of the process is correct.


edit to add: sorry about using the "stimulus" word, it seems popular these days. "economic activity" can be substituted if you wish.
Click to expand...

"The situation reverses somewhat when a US manufacturer outsources his manufacturing. The example of the Ford made in Canada (or Mexico, or any other country). If production costs are significantly less for Ford to offshore their car production, their corporate profit is greater per unit than if that product were made in Detroit. This offsets to a degree the stimulus lost by paying foreign workers to build the cars. If sub-assemblies are US made, then the loss is less."


Forgive me for not being able to keep up but I'm lost here.

Are you saying it is better for the US to have Ford build cars in Mexico, than Toyota to build cars in Texas?

If so I want to be a Ford executive, must be a lot of them to spread all that money around to.

How do you get that job and how many of those jobs are there compared to the factory workers in Texas & Ohio?
 
roundgunner said:
Forgive me for not being able to keep up but I'm lost here.

Are you saying it is better for the US to have Ford build cars in Mexico, than Toyota to build cars in Texas?

If so I want to be a Ford executive, must be a lot of them to spread all that money around to.

How do you get that job and how many of those jobs are there compared to the factory workers in Texas & Ohio?
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I was thinkin' the same thing ;). Toyota, directly or indirectly, is responsible for some 200,000+ jobs in the US. So having more money in the hands of a few is better than less money in the hands of many?
 
m1gunner, I'm still not buying the idea that half the price of a new car is profit. Even if you add in GM's legacy costs (pensions and health care for retirees), which are under $3k/ car, they should still be making a profit.

I have been running my own service related business for the last 10 years, and I ran someone else's mfg. business for five years before that. I understand just a little about how business and accounting work. ;)
 
I am the proud owner of a 2010 Scion xB "Boxmobile" Small, fast, great mileage, and carries a lot of gear inside.
It is, as everyone is aware, a Toyota product. I figure that all of the recalls and other stuff going on with Toyota makes will make its way to the Scion brand as well.
If mine ever started to runaway, first I'd shove the transmission into 1st gear and use the transmission to slow the car down using the brakes as well...then shift the car into neutral and coast to "hopefully" safe harbor.

This is the scenario that I would use and hope I never have to test the theory in practice.
 
truckemup97 said:
m1gunner, I'm still not buying the idea that half the price of a new car is profit. Even if you add in GM's legacy costs (pensions and health care for retirees), which are under $3k/ car, they should still be making a profit.

;)
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I didn't mean to imply it is all profit. What I ment to say is the unit manufacturing cost of these vehicles is less than half the MSRP of the vehicle.

I also tried to give an idea of what all can be included in the "cost per delivered unit" when a company does its books. The auto industry is one of the most complicated business entities in this country, and a complete discussion of where every dollar goes that a car company takes in would fill several books and is way beyond my paygrade, thankfully.

That GM and Chrysler aren't truning a profit in the same market where Ford and Toyota are turning a profit, points to bad decisions and mismanagement by the suffering companies. If there isn't a change in their decision making abilities, tney will fade from the market.

Back to the Toyota problem, they are now suffering from poor decision making WRT the handling of the runaway acceleration issues dating back 5 years or so. Will these mistakes be enough to cause a significant loss in market share? Already happening in the short term, time will tell if it becomes permenant.
 
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