Toyota to pay $32.4M in extra fines
WASHINGTON
The Transportation Department said late Monday the civil
penalties will settle investigations into how Toyota dealt with
recalls over accelerator pedals that could get 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 the fall of 2009 as it scrambled to
protect its reputation for safety and reliability.
Toyota's board of directors agreed to pay the fines on Tuesday
at the company's board meeting in Japan, according to an official
familiar with the case, and the company said it agreed to the
penalties without admitting to any violations of U.S. laws.
However, that does not free Toyota from potential civil and
criminal penalties in private lawsuits and other federal
investigations.
The person had spoken earlier Monday on condition of anonymity
ahead of the formal announcement.
Steve St. Angelo, Toyota's chief quality officer for North
America, said in a statement that the company has "worked very
hard over the past year to put these issues behind us and set a new
standard of responsiveness to our customers. These agreements are
an opportunity to turn the page to an even more constructive
relationship with NHTSA (National Highway Traffic Safety
Administration)."
He said Toyota was grateful to its customers for "their
confidence in the quality and reliability of our vehicles."
In April, Toyota agreed to pay the maximum fine allowed under
law for a single case -- $16.4 million -- for failing to promptly
alert U.S. regulators to safety problems over sticking accelerator
pedals. Under federal law, automakers must notify NHTSA within five
days of determining that a safety defect exists and promptly
conduct a recall.
At the time, Toyota denied attempting to hide a safety defect
and said it agreed to the penalty to avoid a lengthy legal battle
with the government.
The latest fines involve two separate safety problems affecting
certain Toyota passenger cars and trucks.
The first case deals with recalls in 2009 and 2010 of about 5
million Toyota and Lexus vehicles with gas pedals that could become
entrapped in floor mats. Toyota had recalled 55,000 all-weather
floor mats in 2007 to address pedal entrapment, but the government
said its investigation found that simply removing the floor mats
was insufficient.
A high-speed crash involving a Lexus in August 2009 killed four
people near San Diego, prompting the government to investigate the
recall. After reviewing crash evidence and other data, NHTSA
investigators concluded that Toyota failed to notify the government
about a known safety defect within five days.
In the second case, Toyota conducted a recall in 2004 of Hilux
trucks in Japan with steering relay rods that could break and
affect steering. Toyota told U.S. regulators in 2004 that the
safety problem was limited to vehicles in Japan and the company had
not received similar complaints in the U.S.
But a year later, Toyota told NHTSA the steering defect was also
found in several U.S. models and recalled nearly 1 million
vehicles. NHTSA said in May 2010 it learned about complaints from
U.S. consumers that Toyota failed to disclose to the government
when it conducted the recall in Japan in 2004.
Toyota turned over thousands of documents to the government as
part of the investigation. The two most recent fines are also the
maximum allowed under law, and are adjusted for inflation.
"Safety is our top priority and we take our responsibility to
protect consumers seriously," said Transportation Secretary Ray
LaHood. "I am pleased that Toyota agreed to pay the maximum
possible penalty and I expect Toyota to work cooperatively in the
future to ensure consumers' safety."
The Japanese automaker faces dozens of lawsuits from families of
people killed or injured in crashes linked to unintended
acceleration. The government's safety agency has received about
3,000 reports of sudden acceleration incidents involving Toyota
vehicles during the past decade, including 93 deaths. NHTSA,
however, has confirmed only the four deaths from the California
crash.
Toyota says their recalls have directly addressed the safety
problems with their vehicles and the company is making progress in
responding to concerns. The company has established engineering
teams to examine cars that are the subject of consumer complaints
and appointed a chief quality officer for North America, giving its
U.S. offices a larger role in safety related decisions.
Toyota has found no link to electronic problems, an issue raised
by safety groups as a potential cause of the vehicle problems. A
separate investigation by the Transportation Department and NASA
has not uncovered any electronic problems, but the probe is
expected to continue into 2011.
The National Academy of Sciences is reviewing potential causes
of unintended acceleration in vehicles across the entire auto
industry and expects to issue its findings in the fall of 2011.
Before Toyota's recall crisis, the largest automaker fine was $1
million paid by General Motors in 2004 for a slow response to a
recall of nearly 600,000 vehicles with faulty windshield wipers.