Toyota agrees to $1.2B recall settlement

BY GERRY MILES

No one really likes stories like these, at least I hope not, but Toyota has reached an agreement with the U.S. Attorney’s Office for the Southern District of New York to resolve its investigation initiated in February 2010 into the communications and decision-making processes related to the company’s 2009-2010 recalls to address potential “sticking” accelerator pedals and floor mat entrapment. As part of the agreement, Toyota will make a payment totaling $1.2 billion.

Call it what you will. The easy way out of a dire situation, check-book casualty calamity claims, or buying justice – just to name a few. In the end, if you or I were Acme Large Co., and facing all of the legal wrangling Toyota is over the alleged claims, you, too, might do the prudent thing given the deep pockets available and cut your losses. Quickly.

I’m not one to cow tow to large firms as it seems there’s always a smoking e-mail or memo from someone deep inside most Acme Large Firms to prove there had been an earlier fly in the ointments that got brushed over.

In Toyota’s case of the so-called sticking floor mats, I think otherwise. Like many folks nabbed for speeding who toss a drink on their lap to say they need a bathroom break to the state police, I tend to think that some of the claimants may have sped up and claimed similar problems. In the words of a former White House official who said “never let a tragedy escape as a teachable moment” or something similar, I think many jumped on the legal case bandwagon(s).

“At the time of these recalls, we took full responsibility for any concerns our actions may have caused customers, and we rededicated ourselves to earning their trust,” said Christopher P. Reynolds, chief legal officer, Toyota Motor North America. “In the more than four years since these recalls, we have gone back to basics at Toyota to put our customers first.”

“Specifically, we have taken a number of steps that have enabled us to enhance quality control, respond more quickly to customer concerns, strengthen regional autonomy and speed decision-making. And, we’re committed to continued improvement in everything we do to keep building trust in our company, our people and our products. Importantly, Toyota addressed the sticky pedal and floor mat entrapment issues with effective and durable solutions, and we stand behind the safety and quality of our vehicles.

With the lack of reported incidents since then – none in the news come to mind – it seems the fury over the sticking pedals is over. Let’s hope so.

Among the substantive actions the company has voluntarily taken since the recalls are:

  •  • Launching rapid-response teams to investigate customer concerns quickly;
  •  • Committing $50 million in 2011 to launch Toyota’s Collaborative Safety Research Center in Ann Arbor, Michigan to partner with more than 16 universities and institutions across North America on safety advances that will be shared to benefit the entire auto industry and society;
  •  • Expanding its network of field quality offices to improve customer responsiveness;
  •  • Enhancing regional autonomy, including naming the first American CEO of Toyota’s North American Region as well as Chief Quality Officers for North America and other principal regions – all of whom have direct lines to President Akio Toyoda;
  •  • Improving its quality control process; and
  •  • Extending the new vehicle development cycle by four weeks to help ensure reliability and safety.

Under the agreement, the Government agrees to defer prosecution and then dismiss its case, as long as Toyota makes the required monetary payment, abides by the terms of the agreement and continues to cooperate with the Government. The agreement also provides for an independent monitor to review policies and procedures relating to Toyota’s safety communications process, its process for internally sharing vehicle accident information and its process for preparing and sharing certain technical reports.

Toyota will record $1.2 billion in after-tax charges against earnings in the fiscal year ending March 31, 2014 for costs relating to the above agreement.

 

Toyota voluntarily recalls Highlander Hybrid, Lexus RX 400h, IS 350, IS 350C and GS 350

From Toyota News

TORRANCE, Calif., Sept. 3, 2013 – Toyota Motor Sales, U.S.A., Inc. today announced that it will conduct two voluntary safety recalls.  One involves approximately 133,000 MY 2006-2010 Highlander Hybrid and MY 2006-2008 Lexus RX 400h vehicles.  The other involves approximately 102,000 MY 2006-2011 Lexus IS 350, IS 350C, and GS 350 vehicles.In the involved Toyota Highlander Hybrid and Lexus RX 400h vehicles, transistors within the hybrid system’s inverter assembly can experience heat damage due to variations in characteristics of the transistors built in parallel circuits.  Should this occur, various warning lights on the instrument panel will illuminate, and in most cases the vehicle will enter “limp home mode.”  In limited instances, the hybrid system will shut down and resulting in the vehicle stopping while the vehicle is being driven.In the involved Lexus IS 350, IS 350C and GS 350 vehicles, bolts used to secure the variable valve timing control device can become loose, causing the vehicle to stop while being driven.  Early warning for this condition can be an abnormal noise just after start-up.Owners of vehicles subject to these recalls will receive a notification by first class mail.Detailed information is available to customers at www.toyota.com/recall and www.lexus.com/recall and by calling the Toyota Customer Experience Center at 1-800-331-4331.

Ford recalls 2005-2011 Crown Vics, Grand Marquis, Town Cars for possible steering issues

From NHTSA website.

Ford is recalling certain model year 2005-2011 Ford Crown Victoria (including Crown Victoria Police Interceptors), Mercury Grand Marquis, and Lincoln Town Car vehicles. The affected vehicles are currently registered or were originally sold in Connecticut, Delaware, the District of Columbia, Illinois, Indiana, Iowa, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Vermont, Virginia, West Virginia, and Wisconsin. Severe corrosion can seize the lower intermediate shaft which may cause the upper intermediate shaft to collapse and the steering column lower bearing to separate.

CONSEQUENCE:

If the lower bearing separates, the vehicle may experience a loss of steering, increasing the risk of a crash.

REMEDY:

Ford will notify owners and dealers will replace the lower intermediate shaft, free of charge. The upper intermediate shaft and steering column lower bearing will be inspected to identify any damage that may have occurred as a result of lower intermediate shaft corrosion, and repaired or replaced as necessary. If the steering column lower bearing has separated, a retainer clip will be installed. The recall is expected to begin October 21, 2013. Owners may contact Ford at 1-866-436-7332. Ford’s recall number is 13S08.

NOTES:

Customers located in non-corrosion states who have concerns regarding their steering will have a one-time option to have their vehicles inspected and, if necessary, repaired. Owners of these vehicles should contact Ford directly about these vehicles. Owners may also contact the National Highway Traffic Safety Administration Vehicle Safety Hotline at 1-888-327-4236 (TTY 1-800-424-9153), or go to http://www.safercar.gov.

Jaguar recalls XK drop tops over faulty roof switch

BY GERRY MILES

According to the NHTSA website, Jaguar Land Rover North America, LLC (Jaguar) is recalling certain model year 2011-2014 XK convertible vehicles manufactured October 1, 2010, through August 1, 2013 because the switch in the overhead roof console also activates the power operated windows when the convertible roof is opening or closing. The switch does not move downward to close the windows.

NHTSA says the stated Jaguars fail to conform to the requirements of Federal Motor Vehicle Safety Standard (FMVSS) No. 118, “Power-Operated Window, Partition, and Roof Panel Systems” and the power windows may inadvertently be activated, pinching a finger or arm.

Jaguar will notify owners, and dealers will replace the overhead roof console, free of charge. The recall is expected to begin by September 27, 2013. Owners may contact Jaguar at 1-800-452-4827. Jaguar’s recall number is J030.
Owners may also contact the National Highway Traffic Safety Administration Vehicle Safety Hotline at 1-888-327-4236 (TTY 1-800-424-9153), or go to http://www.safercar.gov.

Toyota announced voluntary recall of 342,000 Tacoma Access Cab trucks

TORRANCE, CA  August 7, 2013 – Toyota Motor Sales, USA, Inc. today announced that it will conduct a voluntary safety recall involving approximately 342,000 Toyota Tacoma Access Cab vehicles, produced from 2004 to 2011.
In the involved vehicles, screws that attach the seat belt pre-tensioner to the seat belt retractor within the seat belt assembly for the driver and front passenger can become loose over time due to repeatedly and forcefully closing the access door. If the screws loosen completely, the seat belt pre-tensioner and the retractor spring cover could detach from the seat belt retractor, which can affect retractor and pre-tensioner performance.Owners of vehicles subject to this recall will receive a notification by first class mail.
Detailed information is available to customers at www.toyota.com/recall and at the Toyota Customer Experience Center at 1-800-331-4331.

Edmunds.com’s Krebs: Voluntary Jeep recall decision is right

BY GERRY MILES
If there’s an organization, and a person that I respect as much as anyone in the auto industry with the appropriate connections it’s Edmunds.com’s Krebs. She knows what’s going on behind the scenes and what background noise should and should not be filtered out.
With that caveat, I offer up her take on the position by Chrysler to take on voluntary recalls of the affected Jeep Grand Cherokee and Liberty models. Some interesting demographics, mostly to my Northeast region are included. Her statement follows:
Edmunds.com Sr. Analyst Michelle Krebs offers the following analysis:

“We haven’t seen all of the details of the voluntary recall so we don’t know what precisely Chrysler and NHTSA have agreed to. But Chrysler obviously calculated the risks and benefits and concluded that the cost to repair these vehicles isn’t as expensive as the potential long-term damage that could come from bad PR. This was probably the right decision by Chrysler. Last year there were 659 recalls issued by NHTSA, and none of them appear to have had a lasting negative impact on any brand. Once the smoke settles, I expect that this will be just a minor blip in Jeep’s history.”

Edmunds.com has pulled some basic stats on the vehicles affected by the recall:

In total, there are 2.771 million affected Jeeps on the road:

Liberty: 850K
Cherokee:1.9M
Geographic Breakdown:
The most heavily concentrated areas are large cities where the most cars are sold New York, Los Angeles, Chicago. New York has the most of both vehicles.
Grand Cherokee:
New York: 6% of all Jeep Grand Cherokees are there
Los Angeles: 4%
Chicago: 3%
Jeep Liberty:
New York: 6% of all Jeep Liberties are there
Chicago: 3%
Philadelphia: 3%
Boston is #4 on both vehicles’ list
Age Breakdown:
There isn’t a unusual difference between the age breakdown of registered owners and the industry at large:
Liberty: 11% under 34
Grand Cherokee: 13% under 34
If you have a question about the recall process, Edmunds.com offers a quick primer on the process at http://www.edmunds.com/car-safety/how-nhtsa-gets-cars-recalled.html.

Chrysler, NHTSA to work out Jeep recall situation

BY GERRY MILES

After initially rebutting the request for a recall on alleged safety issues from NHTA, and drawing a large spotlight upon itself in the name of consumer safety, Chrysler issued the following statement yesterday on the situation, saying that it was sure a voluntary, visible recall effort would be effective. Below is the full statement from Chrysler.
Chrysler Group LLC and the National Highway Traffic Safety Administration (NHTSA) have resolved their differences with respect to NHTSA’s request to recall 1993-2004 Jeep Grand Cherokee and 2002-07 Jeep Liberty vehicles.

As a result of the agreement, Chrysler Group will conduct a voluntary campaign with respect to the vehicles in question that, in addition to a visual inspection of the vehicle will, if necessary, provide an upgrade to the rear structure of the vehicle to better manage crash forces in low-speed impacts.

Chrysler Group’s analysis of the data confirms that these vehicles are not defective and are among the safest in the peer group. Nonetheless, Chrysler Group recognizes that this matter has raised concerns for its customers and wants to take further steps, in coordination with NHTSA, to provide additional measures to supplement the safety of its vehicles.

Chrysler Group regards safety as a paramount concern and does not compromise on the safety of our customers and their families.