Wild-Ass Speculation Of The Day: Was Jim Press The Man Who Knew Too Much?
In September of 2007, Jim Press surprised the automotive world by leaving Toyota to become president of Chrysler LLC. Press, the first non-Japanese member of the Toyota board of directors, was generally considered to be a major factor in Toyota’s North American success, and his move still has people scratching their heads. It’s been generally assumed that Chrysler’s then owner, Cerberus, promised him a big pile of money. That assumption seems to be reinforced by Press’ inability to pay $1.35 million in debt and taxes last September, which he attributed to bonuses not received due to Chrysler’s meltdown. Still, regardless of the merits of working for the strugling Auburn Hills automaker, leaving Toyota in the first place seemed like a poor career choice.
Press wasn’t the only high ranking Toyota executive that left the company in the second half of 2007. Deborah Wahl Meyer, who was in charge of Lexus marketing, jumped to Chrysler a month before Press. In October of that year, Jim Farley left Toyota to be in charge of marketing at Ford.
Their timing seemed odd.
Toyota was at the top of their game. Chrysler was already financially troubled and Ford had recently mortgaged the entire company, down to the blue oval logo, for $26 billion in cash needed to turn the company around. Though Farley seems secure at Ford, neither Meyer nor Press remains at Chrysler. Why would a number of very successful executives leave well-paid, very secure jobs for much riskier propositions?
Sometimes it’s best to jump ship even before it starts taking on any water.
Though I’m generally an unintended acceleration skeptic, thinking it’s usually driver error, obviously people within Toyota believe it to be a mechanical issue. Irv Miller, a Press lieutenant now safely retired, sent out an email this past January 16, just days before Toyota issued a recall. When it issued the recall, Toyota notified NHTSA that they had started receiving field reports of sticky throttles as early as March 2007.
Call me a conspiracy theorist (which would be funny because I’m allergic to conspiracy theories), but maybe Press, Meyer and Farley knew that the fecal material was about to hit the rotary cooling device. Sure, at first it’s a bit of a stretch to think that high level executives would be aware of low level field reports, but those reports were about the recently launched Tundra pickup truck.
The Tundra wasn’t just another Toyota. The all-new 2007 Tundra was Toyota’s point blank shot at Detroit’s bread and butter full size pickups. Though Toyota had long had its finger on the pulse of American car consumers, the pickup market was a tougher nut to crack. After missing the mark twice, first with the T-100 and then with the first generation Tundra, Toyota invested billions into the Tundra. It’s generally accepted that it costs about $1 billion to design, engineer and produce a new car or light truck. Throw in a new engine and transmission, and you can figure doubling that amount. Toyota also built an entirely new assembly plant in Texas specifically for the Tundra, and they also invested about $1 billion in their Ann Arbor R&D center that did most of the engineering and design work on the ’07 Tundra.
So there was a lot riding on the ’07 Tundra, and Toyota is a company that made its bones on statistical quality control. On a high profile, mission critical project like the Tundra, it’s not inconceivable that high level executives would be in the loop on all quality control issues.
Miller’s retirement was announced along with the pending departure of two other long term Toyota NA executives, Steve Sturm, and Dave Danzer, last December, about a month before he wrote that email. In light of Miller’s email and the subsequent recall and crisis at Toyota, it’s easy to guess at the reasons for those retirements. It’s possible, though, that previous retirements at Toyota, going back as far as 2007, may also be related to the company’s management of the problem.
Meanwhile, what are we to make of Press’s recent, post-recall assessment that Toyota “was hijacked, some years ago, by anti-family, financially oriented pirates”?
Ronnie Schreiber edits Cars In Depth, the original 3D car site.
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- Willie If both nations were actually free market economies I would be totally opposed. The US is closer to being one, but China does a lot to prop up the sectors they want to dominate allowing them to sell WAY below cost, functionally dumping their goods in our market to destroy competition. I have seen this in my area recently with shrimp farmed by Chinese comglomerates being sold super cheap to push local producers (who have to live at US prices and obey US laws) out of business.China also has VERY lax safety and environmental laws which reduce costs greatly. It isn't an equal playing field, they don't play fair.
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Wasn't Press a leading champion of the Tundra? If so, I don't blame Toyota for shunning him. That was a hugely bad decision that was easily predictable (gas prices were eventually going to go up and substantially shrink the big truck market). Toyota would have been much better off to build on its strengths in the compact and mid-sized truck markets. Alas, American auto execs seem to have it embedded in their genes the notion that bigger is better. Toyota would have been better to stick with a Japanese management team so it was more insulated from American-style group think.
Ron, are you saying that Press wasn't one of the strongest champions of the Tundra within Toyota? My recollection is that he was pretty passionate about it -- and even used the automotive press to further his cause. I get that Japanese culture is more group oriented. My point is that since the 1930s auto execs for the Big Three have virtually always equated bigger with better to a much greater degree than anywhere else in the world. This is not to say that you can't point to this phenomena among imports, e.g., look at the way the US versions of the Honda Civic and Accord have grown over the last two decades. However, I would argue that this reflects the general tendency -- particularly among the Japanese -- to succumb to what might be dubbed "GM envy." In the end the Tundra decision was undoubtedly made in Toyota City. But it doesn't seem to be a coincidence that a "bigger is better" guy like Press had prominence during that time period. I hope that one thing the Japanese have learned from the Tundra debacle is that not succumbing to American group think regarding vehicle size could result in better long-term product planning strategies.