Outspoken consumer advocate Ralph Nader says huge recalls and production shutdowns, such as the one taking place at Toyota Motor Corp., could be more common in the future because of the widespread outsourcing of car-part manufacturing.
Mr. Nader, whose seminal 1965 book Unsafe at Any Speed criticized the automotive industry for producing dangerous vehicles, told The Globe and Mail in an interview Thursday that companies such as Toyota are going to have to be more vigilant in their quality control.
When parts are made by third-party manufacturers, and then installed across a number of vehicles, the risks are significantly higher, he said.
"[If]you are outsourcing for your entire vehicle line, [and]the outsourced component is defective, the recall and the embarrassment is much greater."
Toyota said the faulty accelerator - the focus of its recall and suspension of sales of five vehicles - was made by Elkhart, Ind.-based CTS Corp. at a plant in Mississauga, Ont.
Even a company such as Toyota, which has a very strong reputation for producing high quality vehicles, can be severely damaged by this kind of situation, Mr. Nader said. "The overall message is that quality control [means]daily vigilance. You can't coast on your reputation because it can fail very quickly."
Mr. Nader, 75, is a consumer advocate and political activist who has run for president of the United States several times as an independent or Green Party candidate. He has been a persistent critic of the automotive industry for more than four decades.
He noted that sticky throttles have been a recurring defect in automotive history, and a number of companies have had to deal with similar problems in the past.
In some cases, the car companies resisted making recalls until there were thousands of complaints.
Toyota also appears to have underestimated the issue, he said, but is now making the correct move in conducting a broad recall and shutting down manufacturing. It is also doing the right thing by being open and transparent about the issue - a stance which has been shown to improve long-term customer appraisals once a crisis has passed, he noted.
Toyota can recover its reputation for making quality cars, even though "something has clearly broken down," Mr. Nader said.
Corporations tend to "breed amnesia" he said, and can recover from these kinds of disasters in a way that other institutions or individuals can not. "If a doctor or an architect had this type of problem, it is very unlikely they would bounce back, but the corporate shield allows a bounce back."
Over all, however, Mr. Nader said he sees a new era of enormous innovation coming in the automotive sector, including the installation of new safety equipment that can potentially make cars safer.
Technology such as collision avoidance systems and stability controls will greatly improve vehicles, he said, although he noted that much of this innovation is coming from outside suppliers rather than from the auto makers themselves. He is also concerned that car makers may try to cut corners as they produce lighter fuel-efficient vehicles at low prices.