Toyota Motor Corp. has agreed to pay the U.S. government a record $32.4 million in additional fines to settle an investigation into its handling of two recalls at the heart of its safety crisis.
The civil penalties will settle probes into how Toyota dealt with recalls over accelerator pedals that could become trapped in floor mats and steering relay rods that could break and lead to drivers losing control.
The latest settlement, on top of a $16.4 million fine Toyota paid earlier in a related investigation, brings the total penalties levied on the company to $48.8 million. It caps a difficult year for the world’s No. 1 automaker, which recalled more than 11 million vehicles globally since fall 2009 as it scrambled to protect its reputation for safety and reliability.
Toyota’s board of directors agreed at a meeting Tuesday to pay the fines, according to an official, and the carmaker said it agreed to the penalties without admitting to any violations of U.S. laws. However, that doesn’t free Toyota from potential civil and criminal penalties in private lawsuits and other federal investigations.
Toyota Motor Corp.’s recall of 1.53 million autos worldwide for a flaw linked to brake-fluid leaks boosts the company’s tally of U.S. vehicles requiring repairs to more than 5 million this year. Honda Motor Co. plans to fix hundreds of thousands of vehicles for the same defect.
Toyota said yesterday it will repair about 740,000 vehicles in the U.S. and 599,000 in Japan with rubber seals at risk of allowing leaks. U.S. models affected include Avalon sedans, Highlander sport-utility vehicles and Lexus GS 300, IS 250 and IS 350 luxury cars. The Toyota City, Japan-based company has announced recalls covering 5.4 million U.S. autos this year.
“They seem to know they must be very open about this to restore customer confidence,” said Ian Fletcher, an analyst at IHS Automotive in London. “They can’t afford anymore to have the massive political trial they had in the U.S.”
Toyota is recalling 412,000 passenger cars, mostly the Avalon model, in the U.S., and another 16,420 vehicles in Japan for steering problems, the automaker said Thursday.
The 373,000 Avalons being recalled in the U.S. range from the 2000 model year through to 2004 and have improper casting of the steering lock bar — a component for the steering system — causing cracks to develop on the surface.
Toyota on Monday began recalling more than 90,000 luxury Lexus and Crown vehicles in Japan as part of a global recall over defective engines — the latest setback for the automaker beset with quality problems.
On Friday, Toyota Motor Corp. said it would recall a total of 270,000 Lexus and Crown vehicles worldwide to fix flaws in the valve springs, a crucial engine component, that could make the automobile stall while in motion. That includes 138,000 vehicles in the U.S., 91,903 in Japan, 15,000 in Europe, 10,000 in the Middle East, 6,000 in China, 4,000 in Canada, and 8,000 in other regions.
“We apologize for inconveniencing our customers. We hope to fix the problem soon,” Toyota spokesman Paul Nolasco said in a statement.
The Transportation secretary, Ray LaHood, said Monday that the federal government would seek a $16.375 million civil fine, the largest allowed, against Toyota Motor over a recall of sticking accelerator pedals on 2.3 million vehicles.
Mr. LaHood, in a statement, said the company had failed to promptly notify the government when it learned of problems with vehicles elsewhere in the world.
If the fine were levied, it would be the largest civil penalty assessed by the government against a car company, although fines against other companies, like airlines, have been far higher.
Under the law, Toyota has two weeks to accept or contest the fine. It has not replied to the department, a Transportation spokeswoman said. If the company decided to fight the penalty, the government could seek to have it imposed in court.
“Otoko naki”—crying while maintaining masculinity is Toyoda’s latest achievement in his efforts to win back the confidence of the people.
The Toyota Motor Corp. President Akio Toyoda’s tearful public appearances during and after his Congressional testimony in the U.S. won sympathetic votes in Japan on Friday as images and sound bites of the media-shy executive monopolized headlines.
Following Toyoda’s Congressional hearing at which he apologized and assumed full responsibility for the series of events and lapses in judgment that led to the recall of 8.5 million vehicles globally, a tearful Toyoda addressed local Toyota employees.
Yukio Hatoyama, Japan’s prime minister, said Thursday: “It was good for the Toyota president to appear in person at the hearing and testify” on the company’s massive recalls, but he added, “I don’t think this has put an end [to the issue].”
Japan’s transport authorities are planning to tighten rules related to vehicle recalls, responding to criticism that insufficient government oversight in the nation’s recall process may have contributed to delays in the handling of safety problems at Toyota Motor Corp.
Transport minister Seiji Maehara said Tuesday the government will review several aspects of the recall system with an eye toward strengthening its authority and capability in gathering information on vehicle problems and enforcing remedial action when necessary.
“I tend to think there is a great possibility that Toyota didn’t share information with the government properly,” Mr. Maehara said at a press conference. “I think it’s extremely important to strengthen our information-gathering system so the [transport] ministry and the consumers are given full explanations even when the problems seem trivial to the manufacturers.”