Quote:
Toyota Motor Corp. faces a costly setback in the biggest U.S. vehicle launch in its history after owners of its new Tundra pickup reported engine failures.
The Japanese automaker may recall Tundras equipped with 5.7-liter V-8s to replace the engines, a company spokesman said Wednesday.
The trouble with the Tundra's 5.7-liter engines, the most powerful engine available on the new pickup, is the latest in a series of recalls and problems that have dented Toyota's reputation.
The automaker set the industry standards for vehicle quality, but now seems to be straining to maintain top quality as it expands overseas, builds factories and hires thousands of new workers.
"It's really tough," said Karl Brauer, editor of Edmunds.com, an automotive research Web site. "Engine failure kills a car's ability to run and it's not a simple thing to fix."
Such a problem is also likely to affect residual values, he said.
Industry experts say Toyota is extremely vulnerable to negative publicity because of its prominence in the industry.
In the first quarter of 2007, Toyota overtook General Motors Corp. to become the world's leading automaker in terms of sales.
With the launch of the Tundra earlier this year, Toyota aims to double its share of the lucrative full-size pickup market, one of the few segments still dominated by the U.S. automakers.
Toyota officials characterize the Tundra launch as the most important introduction in the company's history in the United States.
The rollout has suffered delays and disappointments. For instance, the Tundra earned lower frontal crash scores than domestic rivals such as the Ford F-150 and Dodge Ram.
But the engine problem is more damaging and could slow the vehicle's brisk sales momentum.
Company spokesman Bill Kwong said Toyota realized in February that there was a problem with the camshafts delivered by a supplier for the 5.7-liter engine, and the automaker ordered the necessary changes to production.
Still, Toyota has seen 20 cases of engine failure in trucks equipped with 5.7-liter engines, although no injuries have been reported.
Toyota is now studying how many of the 30,000 5.7-liter engines it built are affected
Toyota builds the Tundra pickup at assembly plants in Princeton, Ind., and San Antonio, Texas, and makes the engines in Alabama.
The automaker hopes to sell 200,000 new Tundras this year, compared with 124,508 previous-generation Tundras in 2006.
But U.S. automakers are holding their own in the pickup market, and GM has been successful with its new Chevrolet Silverado and GMC Sierra trucks.
In contrast to their performance in the car market, where they have been pushed back by Japanese nameplates, American manufacturers account for more than 90 percent of full-size pickup sales, which totaled 2.2 million units in 2006.
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