Transport Committee on March 16th, 2010

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Thank you, Mr. Chair.

I think it's true to say that Toyota has enjoyed a world-class brand reputation, at least until very recently, and most would say it's well deserved. I have to say that I was the proud owner of a Camry for 11 years.

I'm also an engineer, and I know that you have to be vigilant when you design, build, or repair an automobile that can be a dangerous vehicle. I'd like to refer to the statistics that my colleague Mr. Volpe just raised--the NHTSA ones that talk about 48 complaints of unintended acceleration in 2000. That number crept up to 660 by 2009.

It disturbs me to see the number go up so high. You mentioned that they're really talking about 17 different classes of accelerator-related issues. I'd like to point to some of the testimony that was provided in some of the complaints here in Canada.

One in April 2004 described the brake pedal as feeling stuck. Another complaint in May 2004 said the complainant had experienced several sudden acceleration and engine-runaway incidents. As you pointed out, that might not have been due to the accelerator pedal; it might have been the engine suddenly revving for unexplained reasons. Obviously whether that was the accelerator pedal, actual acceleration, or not, any time an unexpected event of that kind occurs it's a startling event for the driver and can actually increase the chances of an accident.

In January 2005 the complainant said they pushed the accelerator to the floor but the accelerator did not come back. In June 2005 the complainant said he lifted his foot from the accelerator but the vehicle continued to accelerate. In all of those cases the complainant brought the vehicle to the garage. The garage looked at it and could not find a problem. It basically stopped at that point.

That information and those statistics seem to paint a picture of a problem or problems that remain unaddressed. We're talking about accelerator pedals here. Obviously we all realize how dangerous that can be. It suggests that perhaps recalls should have occurred that were not occurring. It suggests that problems that were being reported were not being solved over a very long period of time. We're talking about nine years in these NHTSA statistics. It suggests the possibility that information that should have been shared with the public was not necessarily being shared.

I know you've provided some explanations here, but how are you dealing with that perception that appears to have taken hold today? Specifically, can you guarantee that the problems associated with the floor mat and the accelerator pedal that you did report have now been solved?

[Stephen Beatty]

Thank you, Mr. Chairman.

I'd like to answer the last question first by saying we have 100% confidence in the remedies we've put in place with respect to both the floor mats and the pedal assembly. Again, I'd be happy, either during the committee or later, to take members through what exactly those remedies are, just by way of demonstration.

It's also important to go back in time and look at the NHTSA database, as you and your colleagues have done, but also to compare it to that of Transport Canada. One of the significant differences between the United States and Canada is that the NHTSA database is based on a customer questionnaire. It is not based on a set of verified incidents. It is simply reporting onto their website. By contrast, what you've received from Transport Canada is a significantly different quality of data. Transport looks into those complaints and attempts to verify what has been going on. In many cases those complaints come nowhere near the manufacturer but are handled by Transport Canada investigators.

During the period you talked about, early in the decade, typically the vehicles, particularly in our lineup, that would have been affected had mechanical throttle assemblies. Historically, for the automobile, where you had those throttle cables and mechanical linkages, you tended to get binding and seizing of the system. That is a well-known mechanical defect in the system. In fact, here in Canada, with the salt conditions and other climatic conditions that we have in place, perhaps the problem is potentially worse with those mechanical linkages. The movement to electronic throttle control eliminates those mechanical linkages and takes that problem away.

When I look at the NHTSA database, roughly 40% of all of the recalls in the United States for unintended acceleration—and I'm seeing 12 manufacturers affected by that—involved cable-binding incidents. As I said, when we move to the new technologies, that goes away.

We have looked at our own warranty data. We've given it to a third-party engineering firm to look at Toyota Canada warranty data. Our warranties do not show any problems that have occurred as a result of moving to the electronic throttle control. So we're very confident in that new technology for solving that particular issue.

[The Chair, Conservative, Merv Tweed]

Thank you.

Monsieur Gaudet.

[Roger Gaudet, Bloc, Montcalm, QC]

Thank you, Mr. Chairman.

Mr. Beatty, a little earlier, Mr. Watson put a question to you concerning the November 2009 meeting with Transport Canada which dealt with the floor mats. He asked you whether the accelerator issue should have been discussed or not and you answered that you did not know.

For his part, Mr. Lehouillier from Transport Canada said that he was very surprised not to have heard about this problem, as you had already received five complaints in Canada and five other ones in the United States.

Why did you wait so long and jeopardize the safety of Quebeckers and Canadians? Why did you wait so long before alerting Transport Canada?

[Stephen Beatty]

I don't believe we had five complaints at the time of the meeting with Transport Canada. I can check the record regarding the sequence of notification to us.

What I was saying was that at the time that we wrapped up our discussion with Transport Canada on floor mats, I was aware of one reported complaint, and we were taking action based on that reported complaint to understand if there was a problem.

[Roger Gaudet, Bloc, Montcalm, QC]

Yet there had only been one complaint. How many complaints do you have to get before you warn Transport Canada? What is your procedure when you receive a complaint? Do you send this directly to Japan or to Transport Canada, or to your manufacturer? I do not know.

I see here that it is important to know that a complaint is not the same thing as a defect that has been flagged. If I go to the garage and if the mechanic only bolts in one screw on my tire rather than all four, that is a problem that he can solve.

What is the difference between a complaint and a measure? If I go by what you said during your presentation, a complaint can be acted upon and things can be corrected, but a measure cannot be corrected.

[Stephen Beatty]

If you take your car into the dealership for servicing, and they're not able to fix whatever you're complaining of, whatever you experienced, they will try to identify it and make adjustments to the car to take that problem away. In some cases they're not able to identify what the problem is, or even if there is a problem. They escalate it to the technicians at Toyota Canada. Our own technicians go on site to attempt to understand what, if any, issue exists. If there's something we don't understand, we issue a technical report, which moves through to quality control in Japan. Engineering then looks hard at these issues and says, “Look, under normal circumstances, if we had a problem, we would be able to deal with this in the service shop. There's something here we can't explain. So please investigate and get back to us as quickly as possible to determine if there's a problem, and then we will act.” But, again, until you know what it is, it's impossible to take action.

[Roger Gaudet, Bloc, Montcalm, QC]

I understand your viewpoint, but the truth is that it took you five months to advise Transport Canada. Rather than going to Japan, you could have gone to see your manufacturers here. They might have been able to give you the answer.

Why did you go to Japan without alerting Transport Canada to the problem? You knew that there was an accelerator problem but you advised the department five months later even though safety was at stake. That is where the problem lies.

Mr. Tanguay, who is here, is your manufacturer. And yet you went to Japan rather than going to see him. I'm having trouble understanding all of this.

[Stephen Beatty]

To be clear, although Mr. Tanguay joins us at the table and is responsible for manufacturing at plants here in Ontario, my manufacturer is Toyota Motor Corporation in Japan. I buy all of my vehicles from Toyota Motor Corporation. That is the line of technical responsibility between Toyota Canada and Toyota Motor Corporation. When I have a technical issue, we turn to the global engineering teams whose responsibility it is to look at these.

As I said, the only difference between us is this. A complaint may be resolved in many different ways. We may ultimately, after investigation, discover that nothing happened and that it was just a misunderstanding; until we know, we can't put a solution in the marketplace, and the reason we don't want to put a solution in the marketplace is we may end up doing more damage than actually correcting a problem.

That said, again, I have no problem with complaints reporting. If that's what the Parliament of Canada wants to do, that's perfectly appropriate, but we operate within a system in Canada that requires defect notification from the manufacturer, not complaints notification. By the same token, not all the complaints that are issued to Transport Canada come back to the manufacturer. I think you may be hitting on an important issue, which is that better communication in both directions can be of assistance generally with road safety.

[The Chair, Conservative, Merv Tweed]

Thank you, Mr. Gaudet.

Go ahead, Mr. Braid.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you, Mr. Chair.

Thank you very much to our officials from Toyota Canada and Toyota Motor Corporation for appearing before us today.

I would like to begin by continuing to focus on the situation with respect to the sticky pedal. Perhaps my questions will primarily directed toward you, Mr. Beatty. To start off, could you please explain exactly when and exactly how you pinpointed the causes of the sticky pedal problem?

[Stephen Beatty]

Mr. Chairman, to be clear about this, the basis for action in Canada came from a field report of a problem with a vehicle. That came to our attention in late October. On that basis, we did what we do with all of the field technical situations that we cannot address in the field: we put those back to quality control in Japan for further investigation and resolution.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Okay.

From that point, please walk us through the steps that you took and the timeline involved to resolve the sticky pedal situation.

[Stephen Beatty]

As usual, what happens is an interim process. As we get more reports from the field that seem to match the same description, those are added to the reports that are sent to Japan. Each time one of those is triggered, that data is then put back through the system to engineering.

Engineering itself begins to look at the process. Typically where a part is developed with an outside supplier, they'll work with quality control at that supplier to try to understand what the problem is and replicate the condition. That replication was subsequently done. I can't give you a precise date for that, but I'm sure we can supply that to you later if that's necessary.

They look to then identify not only that they have identified one situation where it occurs but they've identified the only case where it occurs. They've put it through multiple testing in order to try to determine whether or not they've isolated the cause. In this case, they were able to identify a condition of both wear and condensation. As that happens, you then have to go about trying to engineer a solution to it. You can't trigger a response without being able to know that you have an engineering solution to the problem you've identified as well.

In that process, pedals are cut apart. They are subjected to various types of engineering treatment to try to determine whether you've fixed the problem and they are tested under more extreme conditions than you would normally encounter in the marketplace--hundreds of thousands of cycles on a machine in exposure to high condensation, high moisture conditions to ensure that not only can you not reproduce the condition immediately after you've made the pedal adjustment but that it goes through what amounts to many years of hard, in-service use. We have to replicate that in a lab. Obviously we can't have 15 years worth of experience on it because there wasn't 15 years of experience between the first report and the time we were able to take a recall.

Once we've identified the problem, once we think we have a solution in development, we still can't take that solution to Transport Canada until we're convinced that it's something we can deploy into the marketplace. So we trigger a recall, and in some cases in the industry we trigger a recall many months before there's a solution to the problem. In this case, because of the technical issues related to trying to pinpoint the problem, the engineering was basically running on a parallel track. So there was about a week time lag between the time we were able to speak to Transport Canada and say we'll issue the recall, and the time we came back to them with support from engineering to say we believe this is a viable response to the problem and it will fix the problem.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

The reports came from the field somewhere in Canada, I presume. What process do you have in place to share and exchange information with your counterparts in the U.S. and understand the owner experience there, given that 70% of your cars are exported?

[Stephen Beatty]

The same customer quality groups are responsible for the United States and Canada. The vehicle data in essence is merged as we move to that step. There are unique road conditions in Canada that will give rise to unique Canadian problems. So we first try to isolate those to determine whether there's something that is so unique to Canadian operating conditions that it isn't what is causing the problem. In general, all of that engineering data is merged and is looked at together. In fact in respect of sticky pedal, my understanding is that you had a similar number of complaints in the United States at the same time. The process was tracking together for both Canada and the U.S.

[The Chair, Conservative, Merv Tweed]

Thank you, Mr. Braid.

Just before I go to Mr. Volpe, Mr. Beatty, in your opening comments, on page four, your statement reads, "that in the event of a malfunction shuts down the engine speed". You used the word “reduce” instead. I'm just wondering, do I read it as it reduces, or it actually shuts it right off?

[Stephen Beatty]

No, it will never shut it off. It takes it back toward idle, just to be clear.

[The Chair, Conservative, Merv Tweed]

That's fine. I just wanted to be clear on that.

Mr. Volpe.

[Joe Volpe, Liberal, Eglinton—Lawrence, ON]

Mr. Chair, I'm still disturbed by the fact that we don't have a common safety-related defects definition, and I'm even more perturbed by the fact that Mr. Beatty keeps talking about things that can be explained away when he is telling us that the engineering is taking place in Japan.

I wonder if we could go to Mr. McTeague.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Thank you, Chair.

Arigato gozaimasu.

It's good to see you here today. Thank you for being here.

I will go very quickly to a series of four questions. I believe my colleague Bonnie Crombie has the remaining questions.

In very quick and short order, how far back does the electronic throttle control fix go? What models are we talking about, and what years? That's the first question. Each of the panellists can answer later, if you wish.

We have a discrepancy in the number that you furnished, Mr. Beatty, with respect to the number of people, 17, who have complained, and it has been raised by Transport Canada. Transport Canada has 125. I appreciate the fact that those may be over several years.

I'd like to know whether the fix that you have provided has seen a response by Toyota owners corresponding to what we see in the United States, which is that on cars that have been repaired, complaints of about 60% continue to demonstrate a persistence in the problem.

Finally, could I also ask the extent to which your company is involved in lawsuits relative to these complaints? Could you give us an actual specific number?

Arigato gozaimasu.

[Stephen Beatty]

Thank you. I'll try to remember all the questions.

With respect to lawsuits, as you know, when it comes to class action, class action needs to be certified. I'm not aware that there are any certified class actions in Canada at this point. We've heard, obviously, from a number of parties about the possibility, but at this stage I'm not aware of certified actions.

With respect to the number of complaints, if you go back to last Thursday, Transport Canada was talking about 17 complaints from 2006 to September 1. They then also supplied you with data for complaints that have come in since September 1, basically for the time period that coincides with publicity around campaign recall, specifically in the United States.

One of the things we know is that for any type of recall, no matter what it is, publicity increases the number of complaints that come in. In some of those complaints, they are going back in time to say that now that they think about it, this case some years ago may have been related to it. The difficulty with a report going back in history is that there may be no evidence anymore of the vehicle, let alone what was taking place in the vehicle at that time, so some of those may remain unresolved.

I'm afraid I've forgotten....

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

It was just a question of persistence. Of those that have been fixed, have customers returned to complain that the problem has not been fixed?

[Stephen Beatty]

I'm aware of one case in Canada in which a customer came back to us and said, after the pedal remedy, that they had the same problem that they had reported to us beforehand. We sent a technician and engineer on site, and what we discovered was that the customer had been looking at the vehicle tachometer and had been reporting, both before and after the pedal, a normal operating condition, which was fast idle on cold-weather startup of the vehicle, so in fact it wasn't an issue related to the pedal; it was an issue related to the management of the engine itself, which was a normal operating condition.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Mr. Beatty, before I turn this over to Ms. Crombie, are you absolutely convinced that the structure of Toyota Canada reporting to Nagoya or to Toyota City or to Torrance is sufficient to give Canadians a modicum of protection consistent with the integrity of your company?