Toyota to announce Prius recall this week: report

By Harumi Ozawa, AFPFebruary 7, 2010 4:02 AM
http://www.vancouversun.com/business/Toyota+announce+Prius+recall+this+week+report/2534023/story.html
TOKYO, Feb 7, 2010 (AFP) - Toyota will recall 300,000 Prius hybrid vehicles because of brake flaws, newspapers reported Sunday, in the latest blow to the Japanese car giant reeling from safety woes that have sullied its reputation.
The move will affect the latest model of the Prius, a car beloved of Hollywood stars and environmentalists, following scores of complaints about malfunctioning brake systems.
The Prius problems have dealt a new blow to Toyota, after it had to recall eight million cars around the world because of sticky accelerator pedals.
The Yomiuri Shimbun reported that the Prius recall, to repair a software programme for the anti-lock braking system designed to prevent skidding, is expected to affect some 270,000 vehicles in Japan and the United States alone.
"The company has notified its dealers in Japan that it would recall all the (new model Prius) vehicles sold in the country," the mass-circulation paper said, without giving a source.
"The company will also repair the software free of charge in the United States and other countries in a similar manner," Yomiuri said, adding that the company would make an official announcement this week.
The Nikkei business daily said Toyota would also repair about 30,000 vehicles sold in Europe, China, Australia, Middle East and other areas.
"We’ve been told the automaker will soon give us an official instruction about Prius," said a Toyota dealer in Tokyo.
Company representatives were not available for comment.
Toyota, the world’s largest car maker, has sold over 300,000 of the latest Prius in 60 countries and territories since the new model rolled out in May.
Toyota had originally considered a voluntary repair for the problem, which the company said is not a fundamental defect, but decided on a recall to try to regain customer trust, Yomiuri and Kyodo News reported.
Problems can be fixed at Toyota dealerships in less than an hour, media reports said, adding that units manufactured in January and later already have the updated software.
Toyota came under fire after it said it had fixed the Prius brake system last month without warning drivers who already own the model about the possibility of brake failure.
Japan’s transport ministry reportedly received about 80 complaints this month about brake malfunctions and called for an investigation, while Toyota has separately received more than 100 complaints since the crisis broke.
Local media have said that five cases reported to the government relate to crashes, according to the drivers.
The Prius — which combines a petrol combustion engine with a battery-powered electric motor — is Toyota’s flagship hybrid car and key to its efforts to stay in pole position in fuel-efficient vehicles.
Toyota, which in 2008 dethroned General Motors as the world’s biggest car maker, produced 530,000 hybrids in 2009, spanning 15 models from sport utility vehicles to sedans, mini-vans and the luxury Lexus series.
The company has come under heavy fire for its handling of massive recalls affecting about eight million vehicles worldwide — more than its entire 2009 global sales of 7.8 million vehicles — due to accelerator trouble.
Toyota, which suspended output of eight models including the Corolla due to the defective accelerator pedals, will Monday restart operations at five factories in North America, Japan’s Jiji Press reported.
Vehicles to be assembled at the factories will be installed with redesigned pedals, it said.
The accelerator problems have been blamed for several accidents, including one in California in August in which four family members were killed when their Lexus sedan accelerated on a highway and crashed in a ball of flames.
A class action lawsuit on behalf of owners in the US has alleged Toyota hid problems that have led to the rash of recalls.
Company president Akio Toyoda said Friday he was "deeply sorry" for the string of quality issues and said he would head a new task force to raise standards and investigate the cause of the problems.
But Japanese newspapers have lashed out at Toyota’s slow response to the fiasco and warned it could hurt Japan’s hard-won reputation for trustworthy technology.
Toyota is facing a two-billion-dollar bill from the global recall but last week said it was on course to earn 80 billion yen (880 million dollars) in the fiscal year to March.
© Copyright (c) AFP





Toyota Has Pattern of Slow Response on Safety Issues
By JAMES KANTER, MICHELINE MAYNARD and HIROKO TABUCHI - February 7, 2010
http://www.nytimes.com/2010/02/07/business/global/07toyota.html?hp
This article is by James Kanter, Micheline Maynard and Hiroko Tabuchi.
Toyota’s recalls and disclosures in recent months are part of a lengthy pattern in which the automaker has often reacted slowly to safety concerns, in some instances making design changes without telling customers about problems with vehicles already on the road, an examination of its record shows.
Toyota received complaints from customers in Europe about sticking accelerator pedals as early as December 2008 and started installing redesigned pedals on new vehicles there last August. Months later, in January, similar concerns in the United States led to a pedal recall of 2.3 million vehicles. The European cars have now been recalled, too.
In a Congressional committee meeting on Jan. 27, Toyota officials said they first learned of this problem through reports of sticking pedals in vehicles in England and Ireland in the spring of 2009. But Toyota later acknowledged it had received reports there as early as December 2008.
Three years ago, it recalled 2007 and 2008 Toyota Camrys and Lexus ES 350s because the accelerator could stick under floor mats, a precursor to a much bigger recall last fall.
And in early 1996, Toyota engineers discovered that a crucial steering mechanism could fracture on the Hilux Surf, which was sold as the 4Runner in the United States. Toyota started installing a stronger version on new models.
Yet it took Toyota eight more years to start recalling Hilux Surfs and 4Runners built before the 1996 design change, after an accident involving an out-of-control Hilux Surf prompted a police investigation. Toyota received a rebuke from the Japanese government and was ordered to overhaul its recall system.
Many automakers address problems discreetly when feasible, hoping to avoid an uncomfortable spotlight.
But Toyota, a company that built its reputation with meticulous attention to quality, is now facing a credibility crisis as little-known problems are surfacing with many of its models.
Most recently, Toyota acknowledged it had identified a flaw in the antilock braking systems of its Prius hybrids and altered the system for models built since January. Facing new investigations, Toyota said it was considering a recall. Late Friday it began telling dealers that it would announce a fix early this week.
Toyota officials, when asked about their handling of previous safety issues, responded largely with comments about how they would handle the matter now and in the future.
“The company is prepared to cooperate fully and sincerely, and we are doing our utmost to deal with the matter in a way that brings safety and peace of mind to our customers,” the company’s chief executive, Akio Toyoda, said Friday at a news conference.
“We acknowledge that we could have communicated better as a company,” said James Wiseman, a spokesman for Toyota’s United States division. “However, we have taken significant steps to address these issues.”
Toyota’s handling of safety problems contrasts with steps Toyota took 30 years ago, when it was building its American operations.
Faced with engine and transmission problems on early Camrys, the company’s engineers addressed them, and by the mid-1980s, the Camry’s quality was considered on par with that of the Honda Accord.
After defects showed up on the first Lexuses in 1989, Toyota put together a team to solve them quickly. In many instances, the company went to customers’ homes to collect the cars.
Years later, many consumers started seeing evidence of a more reactive and defensive approach from the company.
In 2002, for example, Toyota faced thousands of complaints from customers who said their cars’ engines could become clogged with oil sludge.
Toyota initially faulted drivers, saying the problem was a result of infrequent oil changes. It agreed to extend warranties to eight years on 3.3 million 1997-to-2002 models. Customers then complained that Toyota made it too difficult to file claims, and the company was soon defending itself from a class-action suit.
Now the company is facing more public accusations of being slow to respond.
The transportation secretary, Ray LaHood, decided to confront Toyota late last year when it did not announce a recall for sticking pedals, although it had recalled millions of cars because their floor mats could interfere with the accelerator.
“Maybe they were a little ‘safety deaf’ in their North American office,” Mr. LaHood told The Associated Press last week.
Japan’s Transport Ministry appeared to be a step ahead of Toyota last week. It ordered the company to investigate problems on the 2010 Prius hybrid that could cause its brakes to be unresponsive when driving slowly on bumpy or icy roads.
Toyota then said it had corrected the problem on cars built since mid-January. But it now faces a decision on whether to recall more than 300,000 cars sold since the newest version of the Prius was introduced last spring.
The most severe criticism has been over Toyota’s handling of the pedal problem.
The company did not recall cars with sticky pedals in Europe, after it made a design change for new cars, because it considered the problem a “customer satisfaction” issue rather than a defect. None of the 26 complaints it received involved cars that had been in accidents, Toyota officials said.
It introduced the design change for new cars being built in Europe last summer, before sticky pedal problems came to a head in the United States.
Only after Toyota announced a recall in the United States did it then extend the recall to 1.8 million European vehicles as well.
In a filing with the National Highway Traffic Safety Administration, Toyota said it had not realized until October that the pedals in cars made in the United States used the same material as those in Europe — even though both are supplied by the same parts maker, CTS of Elkhart, Ind.
Although it made the change on European models last summer, Toyota initially told American authorities it was unaware of any problems with the CTS-made pedals. Instead, Toyota said it believed gas pedals were becoming trapped in floor mats, the subject of an advisory to consumers that was later followed by a recall.
Toyota had “not been able to single out or verify any other cause” for the unintended acceleration, the company said when the floor-mat recall was made.
Analysts questioned Toyota’s explanation.
“There is no way that Toyota in America or Japan would not have known about a replacement taking place in Europe,” said Tadashi Nishioka, an auto industry expert at the University of Hyogo in Japan. “At Toyota, all information flows to headquarters. It’s that kind of company.”
Colin Hensley, the general manager of corporate affairs at Toyota Motor Europe, said the change would eventually have been brought to cars in the United States under Toyota’s practice of sharing new production methods among its plants.
Shinichi Sasaki, the Toyota executive in charge of quality, added last week: “We did realize that it was not good that pedals were not returning to their proper positions, but we took some time to consider whether we needed to take market action.”
When American regulators visited Japan, they “directed us to think of things from a customer’s perspective,” Mr. Sasaki added. “We took this seriously and made the decision to recall the cars.”
Last week, Toyota dealers began replacing pedals on millions of cars. Factories will start installing them in new cars this week.
Keith Bradsher and Michael Parrish contributed reporting.


Toyota's troubles add notch to list of disputes
Attempts to slow, block recalls not new, NHTSA says
BY JUSTIN HYDE, FREE PRESS WASHINGTON STAFF, Posted: Feb. 7, 2010
WASHINGTON -- Toyota's recall of vehicles over sudden acceleration have highlighted an uneasy détente between automakers and the National Highway Traffic Safety Administration -- a relatively small, overworked bureaucracy that relies on public outrage as an enforcer for recalls.
Toyota and NHTSA's battle over faulty parts in 5.6 million vehicles -- and a half-dozen probes into other models -- is expected to be a key topic in at least three congressional hearings set this month.
U.S. Transportation Secretary Ray LaHood said last week that at every crucial step from March 2007 to the present, NHTSA officials had to goad Toyota into acting, whether it was launching the first floor mat recall or expanding it last year after four people died in a California crash.
"When you look at what I've done since we've been there, it's been very aggressive. It will continue to be aggressive," LaHood said last week.
But the agency faces critiques, too.
NHTSA probes "have been too brief and cursory to find other causes," Safety Research & Strategies said in a report last week. The advocacy firm works with attorneys suing Toyota.
Tense relations highlighted
The showdown between Toyota and U.S. auto safety regulators over sudden acceleration in vehicles last week added to a history of disputes between the two sides, going back to when Toyota threatened to recall 157,000 pickups to remove a safety feature.
In 2005, the National Highway Traffic Safety Administration found that 2003 through 2005 model year Toyota Tundras had been built without child-seat latches on the front passenger side, a violation of federal safety rules.
Toyota asked for an exemption, saying the problem was not a safety issue. When NHTSA declined, Toyota warned that the only possible repair that could meet federal rules would be to disable switches allowing the passenger air bag to be shut off -- a feature added after concerns about how air bags could harm children in rear-facing child seats.
Under pressure from regulators, Toyota relented in 2006 and offered to install latches for customers who sought them. A year later, the U.S. agency would pressure Toyota into the first recall involving floor mats in its vehicles that could stick under gas pedals, which includes 5.4 million cars and trucks in the U.S.
Making an example of Toyota?
For an agency that's often dwarfed by the companies it regulates, NHTSA has to rely on suasion as much as its legal powers. Industry officials say the push back by regulators over Toyota's behavior in recent weeks may be an attempt to make an example that the rest of the industry would heed.
"It was not an uncommon occurrence for us to urge a company to do something," said Ricardo Martinez, who served as NHTSA's chief during the Clinton administration. "That is, unfortunately, the typical approach for some companies.
"The thing that is disappointing to me is that Toyota was once one of the more proactive companies."
Compared with the companies it regulates, NHTSA's resources are meager. It has 650 employees and an $850-million annual budget. Besides crash tests, safety research and public campaigns against drunken driving, its Office of Defect Investigations oversaw 608 recalls of faulty vehicles, parts and tires last year, ranging from mopeds to Mack trucks.
With limited resources, NHTSA must rely on manufacturers to police themselves to a large degree; for any given defect, studies have shown the agency gets only 10% of the complaints generated by consumers, with the rest sent to automakers.
Of last year's recalls, just 179, or 29%, were spurred by a NHTSA probe, either based on customer complaints or testing. The rest were launched by manufacturers without government action.
Stalling recalls
Automakers regularly work the agency's probes; they try to limit the scope of investigations, question what the data show and argue for the smallest recalls necessary. There's also a typical revolving door of people moving from the agency to the industry.
But in recent years, automakers have avoided fighting NHTSA head on, often attempting to minimize recalls by jumping on problems quickly rather than letting them build to involve millions of vehicles.
"Manufacturers don't want to do a recall if it's a lot of vehicles or a lot of money," said Joan Claybrook, NHTSA chief during the Carter administration. But if the agency launches a probe into a safety issue, "the company knows they're going to eventually figure it out."
All of 2009's recalls were legally considered voluntary because NHTSA didn't need to issue a formal recall order, which can open a floodgate of legal claims and bad publicity. The last time the agency took such a step with an automaker was in 2008, when BMW rejected NHTSA's directive to recall 28,000 Mini Coopers over exposed exhaust pipes that could burn people's legs.
Just before NHTSA held a hearing, BMW ordered the recall.
The last time an automaker took NHTSA to court over a defect decision was in 1996, when Martinez ordered Chrysler to fix seat belts in 91,000 sedans and the automaker refused.
In the end, both sides lost: A court threw out NHTSA's order and chastised the agency for overreaching, but Chrysler had to recall many of the 91,000 sedans anyway, and suffered from public relations scrutiny.
Challenging U.S. regulators
The idea that NHTSA's decisions should go unchallenged isn't universally accepted. Kevin McDonald, an assistant general council at Volkswagen's U.S. arm, wrote in a Cato Institute magazine last summer that the benefits of NHTSA's defect recalls are "dubious and largely unproven."
McDonald said each recall typically costs automakers at least $100 per vehicle, and no studies conclusively show any benefit to auto safety. He said the recalls could make people less safe because they have to drive extra trips to their dealerships.
"It is certainly worth asking whether, in the aggregate, more lives are put at risk by recalls than are saved," McDonald wrote.
McDonald said his article was his opinion only, and not that of his employer, but those sentiments were once common among industry officials. Just as debacle over defective tires on Ford Explorers that was linked to hundreds of deaths eventually led to Congress requiring automakers to share more data with NHTSA, the Toyota case could lead to more power for U.S. regulators to pursue recalls.
"That's something we need to think about," U.S. Transportation Secretary Ray LaHood said, "and we will think about it."


Sudden-acceleration timeline
July 2003: The National Highway Traffic Safety Administration (NHTSA) opens its first probe of sudden-acceleration complaints in Lexus (a Toyota luxury brand) sedans at an owner's request.
September 2003: The Lexus probe is closed with no defect found.
March 2004: After another customer petition, NHTSA opens a wider probe into Lexus sedans.
July 2004: NHTSA closes its investigation again, with no defect found. It turns down two more requests from owners for new looks at the problem.
March 2007: NHTSA launches probe into floor mats in Lexus models. Toyota says issue is not a safety concern.
July 26, 2007: For the first time, NHTSA verifies fatal crash link to floor mats.
September 2007: Under pressure from NHTSA, Toyota recalls 55,000 floor mats.
January 2008: NHTSA, again at a customer's request, launches probe of sudden acceleration in Tacoma pickups.
August 2008: NHTSA closes Tacoma probe, finding no defect despite hundreds of complaints.
August 2009: Fatal crash of a Lexus ES350 in California kills four people. NHTSA quickly links to floor mats.
September 2009: NHTSA tells Toyota it expects wider recall of mats by the end of the month.
October 2009: Toyota issues floor mat warning but has to be pushed by NHTSA to issue a recall.
December 2009: NHTSA officials fly to Tokyo to meet with Toyota executives, asking for quicker response to safety concerns.
Jan. 16: Toyota tells NHTSA it may have an issue with sticking accelerator pedals.
Jan. 19: NHTSA meets with Toyota in Washington, telling automaker it must conduct a recall.
Jan. 21: Toyota issues recall for 2.3 million vehicles for sticking accelerator pedal.
Jan. 26: Toyota stops selling eight models under pressure from NHTSA.
Jan. 27: Toyota expands pedal recall by 1.1 million vehicles.
Thursday: Toyota admits problems with brake software in 2010 Prius hybrids.
Friday: Akio Toyoda, president of Toyota and grandson of its founder, apologizes for recalls.