Toyota faces criminal probe
Toyota Motor Corp’s woes deepened ahead of its testimony to the American Congress on safety issues, as it revealed it faces a US criminal probe into the handling of its massive recalls, while Japan voiced concern over the economic impact of the automaker’s problems.autos Updated: Feb 23, 2010 21:38 IST
Toyota Motor Corp’s woes deepened ahead of its testimony to the American Congress on safety issues, as it revealed it faces a US criminal probe into the handling of its massive recalls, while Japan voiced concern over the economic impact of the automaker’s problems.
New US documents showed on Monday how the company beat back US safety regulators’ efforts for a wider probe in 2007 and disclosure of a US Securities and Exchange Commission request for documents.
The setbacks came at a time when Toyota’s top executive prepared for a hearing on Capitol Hill over unintended acceleration problems that have been linked to at least five US deaths, with 29 other fatality reports being examined.
In a gesture it said was intended to reassure customers, Toyota said it would install brake-override systems on three more models of vehicles already on US roads: the Tacoma truck going back to 2005 model year, the Venza crossover from 2009 and the Sequoia SUV.
Shares of Toyota fell 0.5 percent to 3,325 yen on Tuesday in Tokyo, matching the Nikkei 225’s fall, suggesting little investor reaction to news of the criminal investigation and the plan for an additional brake override upgrade.
“Investors are not worried about such one-time costs. Instead they welcome Toyota’s efforts to restore confidence in its products and its relations with the US government regardless of the costs,” said Yoshihiko Tabei, analyst at Kazaka Securities.
He said Toyota’s earnings forecast for the year ending next month will likely be unaffected by the costs.