Toyota to pay an additional $32.4 million in civil penalties

The United States Transportation Secretary Ray LaHood announced today that Toyota has agreed to pay an additional $32.425 million in civil penalties as a result of two separate investigations into the automaker’s process of handling recalls.

“Toyota will pay the maximum fines allowable under the law – $16.375 million in one case and $16.050 million in the other – in response to the Department’s assertion that it failed to comply with the requirements of the National Traffic and Motor Vehicle Safety Act for reporting safety defects to the National Highway Traffic Safety Administration (NHTSA),” the Department of Transportation said in a statement released tonight.

“Safety is our top priority and we take our responsibility to protect consumers seriously,” said U.S. 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 first investigation which was completed today result in a $16.375 million fine and involved the Japanese automaker’s recall of nearly 5 million vehicles with accelerator pedals that can become trapped by floor mats.

The second investigation, also completed today, results in a $16.050 million fine and involves a safety defect in several Toyota models that could result in the loss of steering control.

“Automakers are required to report any safety defects to NHTSA swiftly, and we expect them to do so,” said NHTSA Administrator David Strickland. “NHTSA acknowledges Toyota’s efforts to make improvements to its safety culture, and our agency will continue to hold all automakers accountable for defects to protect consumers’ safety.”

The latest settlement, on top of a $16.4 million fine from earlier this year, brings the total penalties levied on the Japanese automaker to $48.8 million. Toyota will pay the fines to the Treasury Department’s General Fund.

Toyota Issues Statement Regarding NHTSA Settlement

Toyota Motor Corporation (TMC) announced today that it has reached two settlement agreements with the National Highway Traffic Safety Administration related to the timeliness of recalls conducted by the company in 2005 to address potential concerns with steering relay rods and from 2007 to early 2010 to address the potential for pedal entrapment by unsecured, incompatible or improperly installed floor mats. Toyota has agreed to pay $32.425 million as part of these settlements, without admitting to any violation of its obligations under the U.S. Safety Act.

Steve St. Angelo, Toyota’s Chief Quality Officer for North America, said:

“Toyota is pleased to have resolved these legacy issues related to the timeliness of prior recalls dating back to 2005. All 30,000 of our U.S. team members, and the tens of thousands of Americans at dealers and suppliers across the country, have 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 and focus even more on listening to our customers and meeting their high expectations for safe and reliable vehicles.

“As we have demonstrated in recent months, our North American operations now have a greater voice in making safety decisions, and we are taking appropriate action whenever any issues emerge. We’ve substantially strengthened our ability to investigate customer concerns through our rapid-response SMART evaluation process and other measures. And, we are continuing to equip our vehicles with advanced features, including our Star Safety System and Smart Stop Technology, both of which are standard on all new models sold in the U.S.

“We are grateful to Toyota drivers for their confidence in the quality and reliability of our vehicles, as reflected in our position as America’s leading retail auto brand. In keeping with the values that have always defined Toyota, we will always put our customers first in everything that we do.”

– By: Omar Rana