Mattel to China: We didn't play nice

Recalled Mattel toys are piled in a shopping cart after being pulled from the shelves at a Chicago store in August 2007.

TEXT OF STORY

KAI RYSSDAL: There was another major recall of Chinese-made goods today -- the Consumer Product Safety Commission announced a voluntary recall of a million cribs due to worries about suffocation. They're manufactured and marketed under the brand names Simplicity for Children and Graco.

Meanwhile, the company at the center of this summer's big toy recalls, Mattel, had something interesting today say today: essentially, "oops." Our New York bureau chief Jill Barshay has that story.


JILL BARSHAY: Love may mean never having to say you're sorry, but business is another matter.

Today a Mattel executive met with a Chinese official in Beijing. The Mattel exec apologized for harming China's reputation -- it was really Mattel's design flaws, not China's shoddy manufacturing, he said. He went even further than that. He said Mattel had recalled too many lead-painted toys, even ones that were safe.

RICHARD GOTTLIEB: I find it hard to believe that they would have recalled product that didn't need to be recalled. It's irrational to me.

That's Richard Gottlieb. He's a toy manufacturing consultant.

GOTTLIEB: For Mattel to have gone through the expense, to have damaged their brand equity, to have had the cost of taking these products back, and then to have lost the sales that these products represent -- it's enormous.

Gottlieb wonders if politics weren't at play. Mattel did not return our phone calls.

Ulice Payne is president of Addison-Clifton -- he advises U.S. companies that do business in China. Payne says the apology shows how savvy Mattel is about the local Chinese market.

ULICE PAYNE: The biggest thing is admitting mistakes. It will go a long way in what they call "guanxi." Guanxi is personal relationships -- even if you don't believe 100 percent you were totally at fault, if it helps keep the harmonious relationship. That is most important in China.

Mattel's going to need harmony if its long-term plans in China are to succeed. It wants to keep producing toys there; the company wants to sell there too. Mattel announced today it's investing $30 million in a Barbie store in Shanghai.

In New York, I'm Jill Barshay for Marketplace.

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