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The Daily Wildcat

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The Daily Wildcat

The Daily Wildcat


    “Toyota fined $16.4 million, accused of hiding defect”

    WASHINGTON — The Obama administration fined Toyota $16.4 million Monday for a four-month delay in announcing defective accelerator pedals in 2.3 million vehicles that could trigger sudden acceleration — and warned that more could be coming.

    The fine, the largest ever levied by U.S. auto safety regulators against an automaker, forces Toyota to either accept a government judgment it ignored U.S. consumer complaints of a safety problem or fight a high-profile court battle with the National Highway Traffic Safety Administration. The world’s largest automaker declined to say what its next step would be.

    The U.S. Department of Transportation said Toyota knew about the pedal defect at least as early as Sept. 29, when it told dealers in Canada and 31 countries in Europe how to handle customer complaints about the problem and fix the pedals.

    In January, the automaker told NHTSA about the problem and issued a recall, revealing that the first complaints had been heard from customers as far back as 2007. It had changed the materials used to build the pedals in production twice — once in February 2008, and again in August of last year — without issuing a recall. And in its official notice to U.S. regulators, Toyota did not reveal the September bulletin to dealers outside the United States.

    Under federal law, once automakers discover a possible safety defect, they have five days to report it to the U.S. government.

    “”We now have proof that Toyota failed to live up to its legal obligations,”” said U.S. Transportation SecretaryRay LaHood. “”Worse yet, they knowingly hid a dangerous defect for months from U.S. officials and did not take action to protect millions of drivers and their families. For those reasons, we are seeking the maximum penalty possible under current laws.””

    Toyota has two weeks to determine whether to accept the fine. In a statement, the automaker did not say what it would do next, but touted the steps it took to tackle quality problems following the recall.

    “”While we have not yet received their letter, we understand that NHTSA has taken a position on this recall,”” the automaker said.

    The administration said it would consider assessing other fines against Toyota if it found evidence the Japanese automaker withheld more information about defects. Toyota has recalled 5.6 million vehicles in the United States to fix two problems it says can cause sudden acceleration, and NHTSA is probing whether any other defects could account for thousands of complaints about Toyota and Lexus models.

    In February, NHTSA opened three investigations into Toyota’s handling of its recalls and complaints of sudden acceleration. In theory, the agency could fine Toyota as much as $49 million if it found the company withheld information in all three cases. Before today, the largest fine NHTSA had ever levied over a recall was $1 million against General Motors in 2004.

    That same month, Toyota estimated it would earn about $840 million for the fiscal year that ended March 31, on revenues of $195 billion.

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