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Live Coverage of Toyota in the Hot Seat
Aired February 24, 2010 - 11:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: Tony Harris, everything starts in your hour, my friend.
TONY HARRIS, CNN ANCHOR: Yes. It looks like we get started in just a couple of minutes. I just saw some movement in the room, in the hearing room.
We've got a full show for you. I can't wait to see the testimony. It looks like that's going to happen from the top man at Toyota. It looks like it's going to happen in Ali Velshi's hour. But Ali is here, Paul is going to stick around with us, and we are ready to rock 'n' roll, Kyra.
PHILLIPS: All right. We'll debrief tomorrow. We're all watching.
HARRIS: Great. Yes. Absolutely.
PHILLIPS: Good to see you, Tony.
HARRIS: Have a great day.
Welcome, everybody. It is Wednesday, the 24th day of February.
He is the man of the hour. CNN live coverage as Congress questions Toyota's president about his company's safety recalls and the way he has handled it.
On the story, congressional correspondent Brianna Keilar covering the House Oversight Committee hearing. Chief business correspondent Ali Velshi is here, focusing on the financial fallout for Toyota. And Kyung Lah watching repercussions in Japan as the nation's revered brand navigates a crisis of confidence.
Good morning, everyone. I'm Tony Harris, and you are in the CNN NEWSROOM.
So let's go.
Round two of the Toyota recall hearing starts right now on Capitol Hill, and you are looking at live pictures of the House Oversight Committee session. The much-anticipated testimony from the company president, Akio Toyoda, coming today. A main part of his challenge, addressing victims like the woman who gave emotional testimony yesterday about the horror of being in a runaway car. (BEGIN VIDEO CLIP)
RHONDA SMITH, FORMER LEXUS OWNER: I prayed for God to help me. I called my husband on the Bluetooth phone system. I knew -- I'm sorry. I knew he could not help me, but I wanted to hear his voice one more time. After six miles, God intervened, as the car came very slowly to a stop.
(END VIDEO CLIP)
HARRIS: Toyota's president now needs to win back customers' trust starting with this hearing today.
CNN congressional correspondent Brianna Keilar on Capitol hill.
Brianna, if you would, set the scene for us. What can we expect to hear today?
BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: I'm outside of the House Oversight Committee hearing room. And actually, Akio Toyoda, the head of Toyota Global, he arrived quite early today. This allowed him to escape some of the attention of cameras, which you could argue might have been a smart move on his part. But he, as I understand, should be off to the side, in sort of a waiting room next to the hearing.
Right now, the panel we're going to see going first after these opening statements by the top Republican and top Democrat on this committee, we're going to be seeing Ray LaHood, the transportation secretary. And he's going to be talking about the role of federal regulators.
And certainly members of this committee have criticism both for Toyota and for federal regulators known as the National Highway Traffic Safety Administration. In fact, Ed Towns, who is speaking right now, is going to tell the committee -- is going to tell, really, the whole hearing room that NHTSA failed the taxpayers and Toyota failed their customers. If the Camry and the Prius were airplanes, they would be grounded.
And I have to tell you, Tony, there's a bit of a controversy right now because earlier, when we were in the room, there was a placard there, and we've been told that David Strickland, who is the head of NHTSA, was going to be testifying today. Then we learned from Republicans on the committee that he is not going to be testifying.
This is creating some rancor between Republicans and Democrats on the committee. Republicans say the Obama administration is circling the wagons. Democrats on the committee are insisting that, no, our Democratic aides are telling us this is Ray LaHood, the transportation secretary, who's saying, no, he's going to handle it all.
Either way, I have talked to Democrats and Republicans who are pretty ticked off that they are not going to be hearing from the head of NHTSA, who is in charge of the federal regulators who many of these lawmakers say missed huge red flags when it came to these Toyota vehicles -- Tony.
HARRIS: OK. I think you're absolutely right. I think everyone expected to hear from Mr. Strickland, and it looks like we're not going to hear from him today.
But let's do this -- let's take you inside the hearing room now and let's listen to the chairman, Representative Towns.
REP. EDOLPHUS TOWNS (D-NY), CHAIRMAN, OVERSIGHT COMMITTEE: Thousands of complaints, multiple investigations and serial recalls are bad enough, but we now have 39 deaths attributed to sudden acceleration in Toyotas. To give that horrifying number some perspective, there were 27 deaths attributed to the famous Pinto exploding gas tank of the 1970s.
In short, if the Camry and the Prius were airplanes, they would be grounded.
These facts raise several important questions. Is it safe to drive these cars? Is Toyota now serious about solving the problem? Can NHTSA say the cause of the problem has been identified and fixed?
What can we do to prevent this kind of thing from happening again? Can the American people trust NHTSA to ensure vehicle safety?
Hopefully we will find some answers to these and many other questions today.
On that note, I yield to the gentleman, ranking member from California, Congressman Darrell Issa, for his opening statement.
REP. DARRELL ISSA (R-CA), RANKING MEMBER, OVERSIGHT COMMITTEE: Thank you, Mr. Chairman.
A little housekeeping.
Mr. Chairman, I'd ask unanimous consent Mr. Jeff Davis of the Commonwealth of Kentucky be allowed to participate in the hearing as a deus (ph) member, recognizing that there will be -- unlikely that there will be any time for him to ask questions.
TOWNS: Without objection, it's accepted.
ISSA: Thank you, Mr. Chairman.
Mr. Chairman, it is the obligation of yourself, primarily, and then myself to set the tone for hearings, to tee up, if you will, through our opening statements how we view what we're going to accomplish here today. And I'd like to commend you for the work you have done in your opening statement and add just a little bit more to it.
I'd first like to put up a slide of the recalls, from recall to recovery.
This slide shows a little of the history that the chairman alluded to: the 1978 recall of the Ford Pinto; the 1981 GM recalls for steering problems, 5.8 million vehicles; the very sad, with great loss of life, 1982 Tylenol recalls of 31 million bottles of Tylenol pills, which of course led to the tamper-proof bottles we all take for granted today; the 1996 Ford recalls of eight million vehicles for fires; and of course the well-publicized GM recall after their pickup trucks would spontaneously explode if hit from the rear.
Mr. Chairman, this is an example of companies, both auto and non- auto, who, over the years, have faced clear challenges.
In the case of the auto companies, we expect to see them again. We judge them not by whether or not they from time to time have unseen and developed problems in their vehicles, but how quickly they respond and how they, in fact, react after scrutiny, either within their own company or from without, brings these to their attention.
I will not call any of these five a success except for Tylenol. Tylenol was a victim of other people, in all likelihood, poisoning their product, and yet they took a step that has changed safety of the medicines we take for granted today.
Recently, Mr. Toyoda's company, Toyota Motor Cars, began airing a television commercial, and I will take the liberty of using his words today. In it, they said that, in fact, good companies fix the mistakes they have made, but great companies learn from them.
Today, we will be asking Mr. Toyoda and Mr. Inaba those very questions as to whether or not they are a good company or a great company.
My second slide I think depicts one of the challenges of why prior to today, we cannot say that Toyota was a great company. Perhaps not even a good company, when in 2007 what we know for fact is that floor mat problems or gas pedal entrapment problems were discovered in similar vehicles in both the United States and Japan.
In the United States, working with NHTSA, a negotiated fix related to the carpets occurred. In Japan, the gas pedal, like the one seen here today, was shortened.
In 2009, nearly two years later, we had the sad and fatal loss of life in what is, in all likelihood, and has been at least documented, reported and not formally contested, to be a carpet entrapment problem of an automobile loaned by Bob Baker, a local dealer in my city, that led to this loss of life.
Today, in 2010, gas pedals are being shortened at dealers around the country.
It is very clear that at least at Toyota, a possible solution now seen as superior was available, contemplated and executed, but not for the very car that ultimately -- the ES 350 -- that led to this loss of life.
So today we will be asking two questions. How could NHTSA, in this modern age in which I can Google Secretary LaHood's name, get pictures from all over the world of the secretary, to get information and bio and almost anything from databases around the globe, how is it that NHTSA does not formally have a system to know about every repot, whether it is a sticky accelerator in Great Britain, whether it is a troubled system in Canada, whether it is a different but similar vehicle in Japan, NHTSA is not prepared to proactively act?
Some would say that we should in fact add to our bodies of laws. I believe that both NHTSA and Secretary LaHood will tell us that our body of law is sufficient, and yet modernization is required.
I'm delighted to have my friend and former colleague, Secretary LaHood, here today, because it will be on his watch that either the Department of Transportation will be a good organization dealing with these specific problems, or a great organization learning from the mistakes of the past.
Mr. Chairman, I thank you for holding this hearing. I look forward to our witnesses and I yield back.
TOWNS: I thank the ranking member for his statement.
At this time, we would like to introduce our first witness, the honorable Raymond H. LaHood, secretary of transportation.
HARRIS: OK -- let's do this very quickly as the housekeeping is being taken care of and the transportation is being introduced and sworn in. We want to talk to our chief business correspondent, Ali Velshi. He's also the anchor of CNN NEWSROOM, that follows this program at 1:00 p.m. Eastern Time.
Ali, good to see you. It's good to have you spend a couple of minutes with us.
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Yes.
HARRIS: What's at stake here for this company and Mr. Toyoda as he testifies today?
VELSHI: Right. The smaller matter is the cost of repairing these cars. While that's billions of dollars, the reality is that's not important here.
Toyota's reputation is built on reliability, and the fact people don't buy them to be flashy, they buy them because they're safe and the company is reliable. The delays in responding to this have been -- and you just heard that. That's what the problem is for Toyota.
So, Mr. Toyoda is going to have to, later on this afternoon, convince people that they are on the case. The problem Toyota has is this issue of whether or not the fix for these accelerators is actually correct, because there are a lot of people who are saying it's an electronic problem and Toyota is not fixing the right thing.
HARRIS: Yes.
VELSHI: That's a big problem for them because they need to rebuild their reputation. Others have done it -- Tylenol, Ford. It's happened. And Toyota is a big company, but he's got to come out and say we're on the case.
If they don't, look at the constituencies. Workers, all of -- its investors, it's drivers, a lot of people out there listening to this.
HARRIS: Yes.
And let's do this -- let's get you back to the hearing room now and the transportation secretary, Ray LaHood.
(JOINED IN PROGRESS)
RAY LAHOOD, U.S. SECRETARY OF TRANSPORTATION: -- crashed in Buffalo, we learned right away what many of the problems were and we did not wait one year for the NTSB to conclude its investigation. We began working with the aviation industry immediately to enhance airline safety and pilot training, holding 12 safety summits around the country. This spring, the FAA will issue a new rule to combat pilot fatigue, and it has already begun to overhaul pilot certification qualifications.
One of the hallmarks of my time as transportation secretary has been our work on distracted driving. For all of you with cell phones and BlackBerrys and other electronic devices, I want you to know that I'm on a rampage about people talking and texting while driving a bus, train or plane -- and an automobile. It's a menace to society, and we recently exercised our authority to ban truck drivers from texting while driving.
Now for Toyota.
The Toyota recall situation is extremely serious and we are treating it extremely seriously. The three recalls involving Toyota are among the largest in automobile history affecting more than six million people in the country.
And I'd like to say a word to consumers. If you notice your gas pedal or your brake is not responding as it normally would, contact your Toyota dealer now.
The recent recalls involve three issues.
One, accelerator pedal entrapment by floor mats which can lead to uncontrolled acceleration at very high speeds. It is important to take your floor mats out of your driver's side of your vehicle until your car has been repaired for this problem by a authentic Toyota dealer.
Second, accelerator pedals sticking or returning slowly after being depressed. If the pedal is harder to depress or slower to return after releasing it, this could be the precursor to what is known as a sticky pedal. If your pedal has these symptoms, contact your Toyota dealer immediately. If your gas pedal becomes stuck for any reason, steadily apply the brake, put the car in neutral, bring it to a stop in a safe place and call your dealer.
Finally, with the Toyota Prius for model year 2010 and the Lexus HS 250, if you experience a change in your car's braking performance, contact your Toyota dealer.
Now, I want everyone to know that the National Highway Traffic Safety Administration has the most effective defect investigation program in the world. Known as NHTSA, its job is to investigate complaints and to look for defects.
NHTSA receives more than 30,000 complaints from consumers every year, and we take every one seriously. We look at every one, we don't set any of them aside, and we review them quickly to make sure that if there's a serious issue, we will look at it and ultimately investigate it.
Over just the last three years, NHTSA's defect and compliance investigation have resulted in 524 recalls involving 23 million vehicles.
We haven't been sitting around on our hands. When people complain, we investigate. When there needs to be a recall, we do it.
Of the 100 investigations NHTSA opens in an average year, there are currently 44 open defect investigations, five of which involve Toyota. Every step of the way, NHTSA officials have pushed Toyota to take corrective action so that consumers would be safe.
Unhappy with Toyota's responsiveness to our safety concerns, the acting administrator of NHTSA, Ron Medford, and two associates flew to Japan in December of '09 to clarify for Toyota management what the company's legal obligations are to find and remedy safety defects in vehicles sold here in America.
In January, our new administrator of NHTSA, David Strickland, and Ron Medford, now our deputy administrator, told the president of Toyota North America in no uncertain terms that we expect prompt action following the disclosure of the sticky pedal problem. Toyota publicly announced that recall two days later. I have been on the phone with Mr. Toyoda from here to Japan, and I'm so pleased that he accepted the invitation to appear before this committee.
With potential fatal defects on the road, NHTSA has pressed hard to expedite these safety fixes. If NHTSA had opened a formal investigation, and Toyota had resisted a recall, that would have consumed an enormous amount of time and resources. In effect, extending the period in which owners of affected vehicles are at risk. By engaging Toyota directly and persuading the company to take action, the agency avoided a lengthy investigation that would have delayed fixes for a year or more.
Last week, I announced that we are investigating whether Toyota acted quickly enough in reporting these safety defects to NHTSA, as well as whether they took all appropriate action to protect consumers. We have asked Toyota to turn over a wide range of the documents that will show us when and how they learned about these safety problems. NHTSA will continue to make sure Toyota is doing all it promised to make its vehicles safe, and we will continue to investigate all possible causes of unintended acceleration.
While the recalls are important steps in that direction, we don't maintain that they answer every question. Some people believe that electromagnetic interference has a dangerous effect on these vehicles.
Although we are not aware of any incidents proven to cause such interference, NHTSA is doing a thorough review. We will get in the reads on this. We will do everything we can to find out if electronics are a part of the problem. And if we find a problem, we'll make sure it's resolved.
I have been assured by Mr. Toyoda that it takes U.S. safety concerns very seriously and that safety is the company's top priority. And we will hold him to that.
Finally, I want to remind everyone that there is a reason we investigate safety defects and there's a reason we push automakers to do the right thing. I listened to the 911 tape of the Saylor family's harrowing last moments. Mark Saylor, a California highway patrolman, died last year, along with his wife and daughter and his brother-in- law, when the accelerator got stuck in the Lexus they were driving crashed at more than 120 miles per hour.
Last evening, after I finished my testimony before the Energy and Commerce Committee, I met with the Saylor family to offer our sympathy and to offer any assistance we could give to them. It was a horrible tragedy, and I hope that no other family has to endure that.
Mr. Chairman, let me conclude by saying this -- I was sworn in on January 23rd of '09. I've traveled to 36 states and 80 cities. Everywhere that I've gone, I've talked about safety. That has to be our number one priority, whether it's in trains, planes or automobiles.
You look at any statement I've ever made, any speech I've ever given, there's always something about safety in it. We will not sleep at DOT and we will work 24/7 at NHTSA to make sure that every Toyota is safe to drive. And we will continue to make safety our number one priority at DOT and at NHTSA.
I look forward to your questions.
TOWNS: Thank you very much, Mr. Secretary. I really appreciate your commitment to safety. I think that's so important.
Let me just raise a couple of questions with you very quickly.
The committee has reviewed thousands of complaints sent to NHTSA regarding sudden acceleration in the Toyota vehicles. Before the crash that killed members of the Saylor family in August, 2009, there were almost 2,000 complaints at the time of Toyota's floor mat recall in 2007. The agency had already received more than 1,300 complaints.
My question is, why did it take NHTSA so long to act? LAHOOD: Well, Mr. Chairman, I would say this -- I've been in this job a little more than a year. And prior to my time, which would have been prior to January 23rd of '09, if there are issues that I can't answer, I'll get back to you for the record.
But I'm going to tell you this -- 30,000 complaints come to NHTSA every year. And we look at every one of them. We think everyone is important.
Some come from people who are driving cars, some come from the industry. We look at what's going on from stakeholders, people who are in the automobile business. Sometimes they file complaints with us.
And then when we see a pattern, we will do an investigation and we will look at it. And if our investigation shows there needs to be a recall, it will be done. That has been the work of NHTSA.
With respect to your specific question, during that time period, what I'd like to do, Mr. Chairman, is put it on the record after I really can get the facts for you.
TOWNS: Thank you very much, Mr. Secretary. Again, I know you, as all of us, recognize how important safety is. So let me ask you this. Do you think it's safe to drive a Toyota today?
LAHOOD: Pardon me?
TOWNS: Do you think it's safe to drive a Toyota today?
LAHOOD: I will say this -- I will say that if people check our Web site, DOT.gov, we have listed every Toyota that is up for recall. I want anybody that has one of those cars to take it to their dealer and to make sure that it gets fixed. And we -- again, we are going to work 24/7 and we are going to continue until every Toyota is safe for their customers to drive.
TOWNS: Well, thank you for your commitment and your dedication in this regard.
I now yield to the ranking member, Mr. Issa.
LAHOOD: This is on, Mr. Issa, but --
UNIDENTIFIED MALE: It just dropped off all of a sudden. It has nothing to do with you, I'm sure.
LAHOOD: OK. Yes.
UNIDENTIFIED MALE: Maybe they can give you the other one.
TOWNS: Switch to the other mike.
LAHOOD: See if this works.
TOWNS: Yes, just switch to that one. In fact -- LAHOOD: OK. Yes, this one works.
TOWNS: -- you can use two.
LAHOOD: OK. I'll use two.
ISSA: Very presidential.
Mr. Secretary, I'll pick up where the chairman left off.
Some companies, including Toyota, I'm told, you can go to their Web site and you can punch in a VIN, which is the one piece of information that anyone who's in possession of the car can see. At your Web site, you have to put in make and model, so you kind of have to know your trim level, et cetera, et cetera.
Can you commit to us that in the foreseeable future, the Department of Transportation could, and if you agree, should have every automobile sold in America, a VIN number on file so if somebody punches in the VIN number, they can see every recall and every piece of safety information that you know of that needs to be applied to that vehicle?
LAHOOD: Given the right amount of time, I will commit to you that that -- we should make that information available. In the simplest possible way for even people who are, you know -- maybe don't have access to a computer or whatever, we should make it available to people.
ISSA: I appreciate that.
And a lot of my questions from my opening remarks are about, what do we do proactively for the future? And I appreciate that we'll have all questions for you and for NHTSA and follow-up questions about the past. But let me go on to another one.
Currently, NHTSA, as I understand it, has 41,000, 42,000, 49,000 in the high-year inquiries or complaints. And, of course, the auto companies also have theirs.
If an auto company reaches a certain threshold, they have a requirement to send that in, in the U.S. If an auto company has a recall in another country, they have an obligation to inform NHTSA. I understand sort of that system.
Now, you and I served in our past lives on the Select Intelligence Committee, so you're very familiar with what our open source system is. Can you tell me today that there's any technological reason or commonsense reason that, in fact, we should not -- we, the United States government and NHTSA -- should not be able to transparently see all claims from all of our first world partners -- now, obviously to be arranged -- and all the collateral material from all the people who want to sell vehicles in this country? Meaning, is there any reason you have to wait until there's a recall to get information? As you know, Great Britain, they didn't actually have a recall, but they had a similar sticky pedal that they didn't see as significant because they thought it only happened there on right-hand- drive cars. And yet, when we were getting a relatively small amount of sticky pedals, had we had that information, like any open source bringing together of information, an agency of the government would have fairly easily have been able to have an alert that could have been sent to the auto company for their attention and response.
Do you see any reason that that's not something that should be part of a great organization rather than a good one?
LAHOOD: I agree that it should be part of it. We believe in transparency. I personally think information can be very powerful. And the more, the better.
ISSA: Now, I know that you can't answer everything about NHTSA, but I think you're familiar with the Toyota Blade sold in Japan, the one that had a pedal similar to this, even though it was not an automobile sold in the United States, in which they shortened the pedal because of entrapment.
Are you familiar with that?
LAHOOD: I'm not intimately familiar with that, Mr. Issa.
ISSA: Well, I would appreciate it if you would respond for the record of how in the future a similar automobile in another country that does have a change can have a change consistent in the U.S.
As I understand in my opening remarks, we took a shortcut with NHTSA's acquiescence and awareness. We took a shortcut on the mats in 2007 here, while in Japan they reduced -- they increased the clearance on the pedal. The difference is the difference in San Diego of that family still being alive.
So that's probably the most important question I have for you, is between open source information and consistency of similar or even sometimes dissimilar parts around the world. Can you commit to me that it is within your vision and authority with existing law to bring about a real change so that this will not happen again?
LAHOOD: I take your point on this. It's a good point, and you have my commitment.
ISSA: OK, I appreciate that.
And if you would do us one favor. And that is, if at some time in the future, you do see the potential need for more authority or more specific legislation, that you would also come back to us --
LAHOOD: Absolutely.
ISSA: Thank you.
Mr. Chairman, thank you again. And I yield back. TOWNS: Thank you, the gentleman from California.
I now yield five minutes to the gentleman from Pennsylvania, Congressman Kanjorski.
REP. PAUL KANJORSKI (D), PENNSYLVANIA: Thank you very much, Mr. Chairman.
Welcome, Mr. Secretary.
LAHOOD: Thank you.
REP. PAUL KANJORSKI (D), PENNSYLVANIA: Thank you very much, Mr. Chairman.
Welcome, Mr. Secretary.
LAHOOD: Thank you.
KANJORSKI: From arriving at this meeting today, I assume this is one of the more uplifting sessions that you've had since in office. I think this is probably the greatest attendance I've seen in the hallways and of the press --
LAHOOD: I would agree.
KANJORSKI: -- at any one of our occasions. Obviously, we've struck a nerve, this committee and the occurrence that happened in California. I wanted to take a moment, Mr. Secretary, to congratulate you. I think --
HARRIS: I think we're going to do this. We're going to sneak in a quick break and then we're going to come back and reset where we are in the hearing process. If you'd like to keep watching this hearing on CNN.com, you can do that now and CNN iPhone.
And just another programming note here, Toyota's president will testify, we believe, at 1:00 p.m. Eastern time.
Coming up, as we weave between the Q&A that's going on right now, we will be hearing from Toyota customers and investors as well.
We're going to take a quick break and come back. You're in the CNN NEWSROOM.
(COMMERCIAL BREAK)
HARRIS: Let's see here, if you want to follow the testimony that's going on right now live a couple of ways to do that -- CNN.com, CNN iPhone, also you can follow the action on Twitter. We have created a list of those inside the hearing room who are tweeting right now. You can find that list at CNN/Toyota.
Toyota taking the heat on Capitol Hill. We are watching as lawmakers probe the car giant over recalls and allegations of slow response time. The transportation secretary, Ray LaHood, is testifying now. He's actually in the Q&A portion after giving an opening statement.
We will dip back in on the Q&A shortly, but let's bring in our personal finance editor Gerri Willis right now. She has been looking into the process of filing a complaint over car trouble.
Gerri, what's the secret to getting your complaint heard?
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Well, it's pretty darn tough. Let's look at some of the facts around this.
OK, you file a complaint with the National Highway Transportation Safety Administration, but the agency is really not obligated to investigate your complaint and there's really no consistency with the way they deal with these complaints. As few as five complaints have triggered an investigation that led to a recall. In other cases, other investigations that led to a recall haven't started until 1,500 complaints.
HARRIS: Hey, Gerri -- Gerri, I apologize. If I could, I think we've got an interesting moment developing in the hearing room. We want to get you back here now.
The question is why isn't NHTSA's administrator testifying and it's a question that's been put to the Transportation secretary.
Let's have a listen.
(JOINED IN PROGRESS)
LAHOOD: -- that's the reason for it.
REP. DAN BURTON (R), INDIANA: Now don't get mad at me, Ray, that was "The Los Angeles Times."
(LAUGHTER)
LAHOOD: Well, just because I raised a little decibel in my voice doesn't mean I'm mad, I can tell you that.
BURTON: Mr. Secretary, I've known you for 20 years, don't give me that stuff.
(LAUGHTER)
You know, there's a question about whether or not there might be some kind of a sweetheart arrangement with some of the people that preceded you working at NHTSA. And there are a number of people, I think at least two NHTSA employees, who now work for Toyota. They're on the Toyota payroll. And I have their names here.
Are you familiar with that at all, sir?
LAHOOD: I've read the reports of that, and we've looked into it. And what the -- what the law requires is that if you've been an employee at DOT and you go to work for a company that does work with DOT, you cannot communicate or participate in the work that you did with this company. So if you go to work for a company, if you go to work for Toyota, you cannot communicate on issues that you dealt with at DOT.
So, for example, if those employees worked at NHTSA, which they did, they can't come back and be talking about these things. They can talk about a highway project or, you know, something like that, I suppose.
But -- and here's my pledge to all of you. If anybody here knows that there's violations, let me know. I'll refer it to the IG and there will be an investigation. We're not going to -- there has been no more higher standard set for ethics than this administration. At the first cabinet meeting the president made it clear, I don't want any ethical problems with anybody.
BURTON: Well, this preceded you anyhow, Mr. Secretary.
LAHOOD: Right.
BURTON: But this Mr. Christopher Santucci (ph), now Toyota's assistant manager of technical and regulatory affairs, did work for the agency. And according to General Motors, Ford and Chrysler, they don't have anybody that's formerly worked for NHTSA that's working for them in those capacities.
But you're saying that these gentlemen that went --
LAHOOD: They can work for Toyota, but they cannot come back and talk about issues that they worked on. They can't do that. They can talk to people in other modes, FAA or some other mode, but they cannot come back and talk to our folks about issues that they --
BURTON: Well, the one thing I would suggest is that the appearance is one of the things that right now I think the public is very concerned about. And a couple of people that worked at NHTSA that go to work and they're in a public relations position, they can talk to people at NHTSA and the appearance may be that they're influencing some decision-making that's going on. So I --
LAHOOD: Look, I agree with you on this, Mr. Burton, and I think this law probably should be tightened up. I really do, because I agree with you. Perception is reality, anybody that's been in politics knows that and I take your point on this.
BURTON: Well, thank you very much. I still love you, Ray.
LAHOOD: Thank you.
(LAUGHTER)
TOWNS: Gentleman, yield back?
BURTON: Yield back.
TOWNS: I recognize the gentleman from Maryland, Representative Cummings. REP. ELIJAH CUMMINGS (D), MARYLAND: Thank you very much, Mr. Chairman. And to Mr. LaHood, Secretary LaHood, it's good to have you here.
One of the things that -- we find ourselves in quite a dilemma here. On the one hand, as Mr. Kanjorski has said, we want to be very careful about what we're doing here because we do have, number one, one of our main trading partners, Japan involved.
On the other hand, though, we have the safety of citizens. Many of our constituents who spend thousands upon thousands of dollars to buy an automobile and they have a right to expect to be safe. And to that end, yesterday, there was some very telling testimony before the Commerce Committee -- and I know you were there and heard about it -- where the president of Toyota Sales USA, when asked about the mat issue, whether it's the sticky pedal or the mat problem, whether recalls in regard to those issues would solve the problem, he was not sure.
Are you familiar?
LAHOOD: Yes, sir. I was there and I heard his testimony.
CUMMINGS: And, you know, as I sat here and I listened to you and you talked about -- you said go to the website and you said if they were -- if people were having certain problem, they should go to the dealership.
And then I heard you, in answer to the chairman's question, I don't think you ever really answered the question because he asked you whether or not you considered Toyota to be safe. You are our safety guy, just as you just said. You said it, I didn't. And I believe that, I believe you are concerned about safety. The question still becomes for our constituents, you as our safety guy --
LAHOOD: Well, let me answer you very directly, Mr. Cummings --
CUMMINGS: Sure, thank you.
LAHOOD: -- for those cars that are listed on our website, dot.gov, for recall to go back, those are not safe. We've determined they're not safe.
CUMMINGS: All right.
LAHOOD: We believe that we need to look at the electronics in these cars, because people have told us they believe there's an issue. And we're going to do that. We're going to have a complete review on the electronics. But for now, any car that's on the website needs to go back to the dealer to be fixed.
CUMMINGS: Now --
LAHOOD: We've determined that those are not safe.
CUMMINGS: All right. LAHOOD: Because of a floor mat problem, because of a sticky pedal, and --
CUMMINGS: It's the "and" that I'm wondering about. Right there. Is -- in other words, you said you didn't consider those safe.
HARRIS: Let's do this, because I promised you the exchange between Representative Burton and the transportation secretary, Ray LaHood, I want to get to that in just a moment, but we're interrupting the Q&A going on right now between the transportation secretary and a Maryland representative, Elijah Cummings.
Let's do that now. Jen, we've got that queued up? All right, this was to the question of why the administrator, the NHTSA administrator wasn't testifying before today's hearing. His name is David Strickland, and you'll get a shot here of Ray LaHood in just a second and you'll see that David Strickland is to the right of the screen and he is over the transportation secretary's left shoulder. So he's in the room, he's just not testifying today. We've been told it's because he's only been on the job for about six weeks or so.
So let's get to that exchange now between Representative Burton and the transportation secretary, Ray LaHood.
(BEGIN VIDEO CLIP)
LAHOOD: Well, look, Mr. Burton, Mr. Strickland has been on the job 40 days. I've been on the job about 13 months. I'm not going to have our NHTSA administrator who's been on the job 40 days appear.
And look it, I'm taking responsibility for this. As I said in my testimony, safety is number one. And I'm going to be accountable. If somebody wants to criticize NHTSA or the department, I'll be responsible for that. Not somebody else. That's my job. I'm not going to duck it and I'm not going to give it to somebody who's only been on the job 40 days.
(END VIDEO CLIP)
HARRIS: Yes, but the issue there is NHTSA is the watchdog, the auto industry watchdog. So maybe one of the questions moving forward here is why isn't the former transportation secretary in the second term of the Bush administration, Mary Peters, testifying? Why isn't the NHTSA administrator in the second term of the Bush administration testifying, Nicole Naison? Still open questions at this point.
Moving forward, let's get back to Gerri Willis. And Gerri had some terrific information that she was sharing with us. And, Gerri, the question I was asking they time we needed to jump back to the hearing was what's the secret to getting your complaint heard by NHTSA?
WILLIS: Well, and I was telling you how this typically works, and I think you'll be surprised at what we found here.
You know, NHTSA investigates only sometimes, not always. And we looked at the history of their investigations. And sometimes it takes five complaints to initiate an investigation, sometimes it takes 1,500.
Once an investigation is launched, the average length of time it takes to conclude that investigation, 262 days, a year. And the longest time it ever took to implement a recall, six years. So you could be waiting a very, very long time. You're never guaranteed that your complaint is going to be investigated.
But as a consumer, you have little choice. NHTSA is really your only outlet to complain. If your brakes are performing unpredictably and the mechanic at the dealership hasn't been able to fix the problem, you have to file a complaint online at NHTSA.gov and click on "Report a Defect" or call 888-327-4236. But I'm not saying it's going to be handled tomorrow.
HARRIS: Well, OK, I've done what you suggested. I've made the call or I've filed the complaint, and I guess you're telling me that it may not be responded to quickly.
WILLIS: That's correct. Now, it's a process, right. So the next thing that happens is that you are investigated to see if it's part of a safety defect trend. There is some info that you're going to have to fill out and give them, including the model of the car, the vehicle identification number -- we're all familiar with VINs now. You'll be prompted to fill out the following information. You have to say the events leading up to the failure, how often the failure occurs, and any consequences of the failure, plus any repairs or replacements you've done on your own.
You'll also want to describe all of the conditions of the road, what you were doing at the time. The more quality you have in that complaint, the more accurate it is, the better chance something can be done about it -- Tony.
HARRIS: OK, and one more question, if I could, Gerri. What if you have a complaint about a defective appliance or computer product?
WILLIS: All right, let's broaden what we're talking about here.
Obviously, first off, you have to see if the product is under warranty. If you paid for the product with a credit card, either a Visa, MasterCard Gold or Platinum card, or American Express, you may have an extra year of warranty. You can also complain to the customer service department, writing a letter to the CEO or another top exec is a pretty good route.
But if you think the problem could be dangerous, you want to file a complaint with the Consumer Product Safety Commission and your state attorney general's office. They're able to identify trends, they get complaints from everywhere.
And don't forget the power of the media. Sound off on consumerists.com or ripoffreport.com. And of course, if you have any questions, send them to me at gerri@CNN.com.
HARRIS: Terrific information, wanted to get that it. Geri, appreciate it, thank you. Thanks for sticking around.
WILLIS: My pleasure.
HARRIS: Let's squeeze the hearing room as well and maybe we can make this work for you.
If you'd like an in-depth look into the Toyota recall, a couple of things you can do. First and foremost go to CNN.com/Toyota. There you can find out if your car has been recalled and what to do about it. It all comes to you from the worldwide leader in news.
Toyota's image at stake to be sure. Will customers buy again? We are talking to a Toyota owner who used to work for Ford and GM. Will he buy American brands from now on?
We're back in a moment.
(COMMERCIAL BREAK)
HARRIS: Hey, you just saw Ali Velshi there, just a moment ago. Ali is still listening to the hearing. If he hears something that he thinks is particularly important, that he needs to bring to our attention, he's going to pop back in. The hearing now continues.
You know, Toyota owners are watching the hearings especially closely. William Ericson owns a 2008 Camry, he is in the shop right now.
William, thanks for taking the time. Let me -- let me ask you, first of all, what specifically are you having worked on right now? Is it the accelerator? Is it the floor mat? A combination of both?
WILLIAM ERICSON, OWNS RECALLED 2008 TOYOTA CAMRY: I brought the car in to have the oil and filter changed. And the service manager said, while it's here, we'd like to do the recall work. It will take longer than changing the oil, but we'd like the car to be brought up to current standards.
HARRIS: William, would you have brought it in otherwise?
ERICSON: If I had been notified by the dealer, yes.
HARRIS: And you hadn't been notified of the recalls?
ERICSON: No. No.
HARRIS: Was that a little surprising to you, given all the public attention on the recalls?
ERICSON: No, I find that understandable. They've got an enormous volume of business as a result of the recall.
HARRIS: Well, that's awfully understanding. You know, this is a pretty serious matter. The transportation secretary said so and that he wants all these cars that are impacted by this recall to get in as quickly as possible to get them fixed. You seem awfully understanding of the dealership not reaching out to you and sending you a letter. Why is that, sir?
ERICSON: I can't explain that, but I can tell you the car has been absolutely satisfactory in the two years I have owned it and I wouldn't hesitate to buy another Toyota.
HARRIS: So, your view of the company has not been impacted at all, negatively, by the news of the recalls, the news of deaths associated with this problem of sudden acceleration?
ERICSON: I have driven many different cars, and I have had fewer problems with a Toyota than previous models.
HARRIS: What do you think of the hearings so far, to the extent you had an opportunity to watch and listen? The transportation secretary, LaHood, says essentially the buck stops with him. What do you think so far?
ERICSON: How many people have been killed in automobiles over the last 100 years? I think it's remarkable that only 39 have been killed in Toyota safety-related incidents.
HARRIS: You are -- you are an awfully understanding man, and I want to let you go so you can get back to hopefully watching a little bit more of the hearing and watching the testimony from the top man at Toyota in the 1:00 p.m. hour, and the best of -- best of luck with your vehicle.
Thank you, sir. Thanks for your time.
ERICSON: You're most welcome.
HARRIS: If you would like an in-depth look into the Toyota recall, just go to CNN.com/Toyota. There you can find out if your car has been recalled and what to do. Take it in? It all comes to you from the worldwide leader in news.
Did Toyota's management style make its recall problems worse? We are live at Toyota in Tokyo to see how the clash of cultures may have compounded the problem.
We're back in a moment.
(COMMERCIAL BREAK)
HARRIS: OK. Transportation Secretary -- you see him right there -- Ray LaHood is still answering questions from representatives. He is taking questions now from Ohio Representative Dennis Kucinich.
Let's listen in.
(JOINED IN PROGRESS)
LAHOOD: -- raised enough then we need to do that. Been raised by people who drive Toyotas, it's been raised by members of Congress, and we're going to do it.
REP. DENNIS KUCINICH (D), OHIO: The distance between Washington and Japan is well established, but the question is, what kind of ability do you have to send those who have the technical skills to analyze documents to Japan to get Toyota's cooperation in being able to review records of research from, let's say, 2004-2005 on these models, internal documents, that would tend to show whether or not Toyota was aware of any of these problems? Do you -- have you sent people specifically to do that? And if you haven't, do you intend to as part of your findings and your investigation?
LAHOOD: We have asked for a voluminous amount of information from Toyota. Which I -- we will review. If we need to go to Japan and meet with their engineers and get more information, that will be a part of our review.
KUCINICH: And so, but you, no doubt, are aware that as an established and respected automobile manufacturer, that Toyota would have research documents within their control that would show the function of various components --
LAHOOD: Of course.
KUCINICH: -- of their system?
LAHOOD: Yes, of course.
KUCINICH: And I think this is important, Mr. Chairman or Madam Chair, that we hear from the secretary on this. Because his department does have the ability to get in to this, and we as members, we can get the documents and analyze them, we have help to be able to understand.
In the time that I have remaining for the instruction of the membership and the public, could you walk us through how complaints are investigated? You know, who does the investigation? Can you enable us to -- to learn? Is this all in-house? Do you outsource any of your investigations?
LAHOOD: Almost all of our investigations are done in-house by our experts. People file complaints with us and we take them seriously, we look in to them. When we decide this is serious enough, we interview people. We look at all the possible written material from the automobile manufacturers, from people themselves, from what -- we gather the most comprehensive amount of information through interviews and research, and then make a judgment if -- if a car needs to be recalled.
KUCINICH: Well, I'm asking -- thank you, Mr. LaHood.
I just want to make sure that you put on your agenda the -- the issue of the redesign of softwares -- software by Toyota engineers in 2005, because we want to see if Toyota's claim that electronics were not to blame, we want to see how that squares with the software redesign that occurred, apparently in response to some kind of an electronics problem. LAHOOD: It's on our radar.
KUCINICH: Thank you very much, Mr. Secretary, and thank you for your service to our country.
LAHOOD: Thank you.
