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March 1, 2010

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Home » Business » Auto

Toyota chief in China for quality talk

FRESH from a grilling by United States lawmakers, Toyota President Akio Toyoda will speak today in China about his company's quality problems, seeking to boost confidence and ease consumer worries in the world's biggest auto market.

Toyoda, who testified at a US Congressional hearing last week about the spate of global recalls plaguing Toyota Motor Corp, will speak to reporters at a Beijing hotel, company spokeswoman Ririko Takeuchi said.

The number of vehicles being recalled in China is small compared with the 8.5 million vehicles recalled worldwide since October for sticky gas pedals, faulty floor mats and glitches in braking software.

But Toyota has ambitious plans for growth in China, where it and its global rivals are finding expansion that was stagnating even before the recall crisis in traditional American and European markets.

The flood of recalls in the US has shaken confidence in Toyota's reputation for top-grade quality. In China, the company announced a recall of 75,552 RAV4 sport-utility vehicles in late January due to the gas pedal problem.

Toyota has said its plans to expand in the Chinese market are unchanged, with its sales in the country expected to rise to 800,000 vehicles this year, up from 709,000 in 2009.

China's overall vehicle sales soared 45 percent last year to 13.6 million, overtaking the US as the world's biggest auto market.

High quality

After answering questions by lawmakers last week, Toyoda visited with dealers and went to Toyota's largest North American assembly plant in Kentucky. He is not scheduled to appear at a Toyota hearing tomorrow by a US Senate committee.

Toyoda, grandson of the company's founder, has made no public appearances in Japan since speaking in Washington, although media reports say he has returned. Toyota's policy is to never comment on the whereabouts of its top executives, saying such details are confidential.

Toyoda's haste in moving on to China appears to reflect its eagerness to restore the reputation for high quality that is its key advantage in China.

Toyota got a relatively late start in China, after efforts to break into the market in tie-ups between its subsidiary Daihatsu Motor Co and state-run Tianjin Automobile Industry Holding Co.

Only in May 2006 did Toyota roll out its first made-in-China Camry, in a partnership with Guangzhou Automobile Group in southern China's Guangdong Province. Toyota also has a partnership with FAW Group, another state-owned automaker based in northern China.

"There is no question but that the Chinese market will overtake the Japanese market," Yoshimi Inaba, now Toyota's top North American executive, declared as the Guangzhou factory opened.

Since then, thanks partly to the global financial crisis, China has overtaken both Japan and the US to become the No. 1 market.


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