Detroit’s Big Three must be breathing a huge sigh of relief. Toyota recently sped past General Motors to become the largest seller of vehicles in the United States globally.
But the Japanese carmaker, which cherishes its reputation for quality, has been forced to stop selling eight of its top models while it tries to fix a problem involving accelerator pads that stick. This glitch has caused 275 crashes and 18 deaths since 1999. Toyota is also recalling 2.3 million vehicles and halting production for a week. But American automakers shouldn’t get too giddy.
Bank of America’s crew on Wall Street can breathe a sigh of relief. It looks like the Charlotte-based bank is set to hand out 2007-like bonuses to all its investment bankers and traders. If so, that will prevent a repeat of last year’s mess when Merrill Lynch staff scored big in the firm’s last bonus round as an independent company – while their new BofA colleagues got squat. But leveling the bonus playing field is not a cultural cure-all.
There’s no guarantee this will remove the lingering resentment the two-tier pay muddle caused. But even if that’s no longer an issue, it requires more than better bonuses to heal the wounds inflicted when two former rivals are forced together. It took years before tensions settled down after Chase bought JPMorgan, for example. In the latter case, last year’s ousting of investment bank co-chief Bill Winters exposed raw merger nerves long considered soothed.