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News, Analysis and EditorialToyota's
Plans to Expand Its Michigan Development and Engineering Activities Proceed:
Comes a Caveat Cum Imperative?
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Toyota's Plans to Expand Its Michigan Development and Engineering Activities Proceed: Comes a Caveat Cum Imperative?
The Michigan state legislature passed legislation authorizing the sale of 690 acres of York Township real estate to Toyota Technical Center USA. And the Detroit Free Press reports a spokeswoman for Governor Jennifer Granholm as saying that the governor will sign it "as soon as it lands on her desk."
Toyota has said that if its technical center acquires the land, it will expand its Michigan development and engineering activities on the lands acquired.
Earlier, a property developer had outbid Toyota by nearly a factor of three, but the state agency overseeing the bidding process rejected both bids. This cleared the way for the state legislature to act.
The expansion of Toyota's Michigan center may give Michigan a short-term benefit, but may as well serve as a warning to future Toyota consumers, as the quality of the products developed by its Michigan technical center is low, or very low, in comparison with the quality of Toyota's other products. The average of the 1995-1999 Reliability Percentank averages for the Camry sedan, the Solara coupe, the Avalon sedan, and the Sienna minivan - the development of all four of which were attributed to its Michigan technical center by Detroit News1 - is .78, while the same average for the remainder of its products is .90.
An expansion of Toyota's Michigan technical center will likely mean that more of the products manufactured in North America will be engineered in North America. This, coupled with the technical center's products' past history of quality, will likely mean a reduction in the quality of Toyota products available in North America. The interesting question that this presents is: Will consumers with a strong bent toward quality deem it imperative to shun every Toyota product made in North America in the absence of sufficient information to determine the origin of the product's engineering and development?
On balance, the expansion may not bring a long-term benefit to anyone and may bring considerable harm to many; at the very least, it will likely make selecting a high reliability Toyota a more arduous task.
1"Toyota Expansion Plans Boost Michigan as Tech Hub," Detroit News, http://www.detnews.com/2004/autosinsider/0408/17/a01-244676.htm
Source for Michigan legislative action: "Toyota Gets Approval for Land: State Bill Allows Automaker to Acquire Prime Site," Detroit Free Press, September 10, 2004, http://www.freep.com/money/autonews/toyota10e_20040910.htm
Source for Reliability Percentrank averages: Table I-MVRP
Addendum: 23 September 2004
For perspective, it should be noted that although the gap between the reliability standings of engineered-in-Japan Toyotas and engineered-in-North America Toyotas, .90 - .78 = .12 per the 1995-1999 Reliability Percentrank averages, may be large, the gap between the reliability standings of engineered-in-North America Toyotas and Big Three vehicles is generally rather cosmic: .78 -.30 = .48 for General Motors, .78 - .31 = .47 for Chrysler, and .78 - .51 = .27 for Ford, by the same measure. Consequently, a person with Big Three experiences may view the quality of an engineered-in-North America Toyota as remarkably high, while a person with engineered-in-Japan experiences may view the quality of the same engineered-in-North America as rather horrific.
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