Amid the recent flood of recalls by Toyota Motor (TM), the federal government has appeared about as meek in looking into the matters as the carmaker has been less than forthcoming. But it seems Uncle Sam has finally got some backbone. Regulators on Tuesday demanded that the world's largest automaker supply documents proving that it acted "in a timely manner" in recalling some 6 million cars in the U.S.In announcing the decision, the National Highway Traffic Safety Administration said it's using its statutory authority to compel Toyota to comply with its request for information. Federal law requires that auto manufacturers act within five days of the discovery of a safety defect by notifying the agency and promptly issuing a recall. "Safety recalls are very serious matters and auto makers are required to quickly report defects," Transportation Secretary Ray LaHood said in a written statement.
If Toyota is determined to have violated its duty under the law, it could be liable for civil penalties of up to $16.4 million. No automaker, however, has been fined more than $1 million for such a violation, the The Wall Street Journal reports.
Seeking More Information
The NHTSA announced the move a day after the agency said the number of people reportedly killed in accidents involving unintended acceleration in Toyota vehicles rose to 34 from 21 in late January. In addition, 22 people have reportedly been injured as a result of the acceleration problems.
NHTSA officials want to know if Toyota has accounted for all problems in all models, and it's seeking information from the company related to production, incidents, complaints, tests and more to make that determination, it said. The three recalls involve Toyota and Lexus models that in some instances have exhibited unintended acceleration. The first of those recalls was issued in September 2007 for accelerator pedals that get hung up on floor mats. That recall was followed by a subsequent one for the same problem last October.
The third recall, announced Jan. 21, involves "sticky" gas pedals, which also resulted in Toyota halting production and sales of the vehicles involved until a fix could be fashioned and retrofitted. The repair involves placing a postage-stamp-size shim between two parts, to eliminate the friction that causes the pedal problems.
Toyota dealers have been working round the clock since the shims became available to repair customers' cars as well as those on their lots. About 500,000, or 22%, of vehicles with the problem have been repaired thus far, Toyota said Monday.
On Tap: A Grilling Before Congress
Production at Toyota's five North American plants resumed Feb. 8, as planned. But Toyota said Tuesday it will stop production at two U.S. plants for a total of 14 days between late February and early April to counter falling sales of Camry, Avalon, Tundra and other models, attributable to consumer concern about the problem. Toyota reported earlier this month that January sales slipped 16%, to the lowest level in a decade.
In addition to the recalls involving unintended acceleration, Toyota has issued two separate recalls for braking problems in 2010 4-cylinder Camry sedans and 2010 Prius and Lexus HS250h gas-electric hybrid vehicles. Federal investigators are also looking into more than 80 reports of steering problems in 2009-10 Corolla models.
Company President Akio Toyoda plans to travel to the U.S. to meet with government officials and members of Congress. It remains unclear whether he'll testify in congressional hearings involving Toyota. Toyoda has apologized several times, and the company has undertaken a massive advertising campaign on TV and in newspapers vowing to put quality and customers first.
Toyota has its work cut out for it.
Bonds for Beginners
Learn about fixed income investments.View Course »