NEW YORK (AP) —
NEW YORK (AP) — Toyota's suspension of U.S. sales on an unprecedented scale to fix faulty Toyota's suspension of U.S. sales on an unprecedented scale to fix faulty gas pedals deals a blow to the automaker's reputation for quality and endangers its fledgling earnings recovery.
The suspect parts are made by a U.S. supplier, but they are also found in its European-made vehicles, an official with the automaker said Wednesday. Toyota said it hasn't decided what to do there.
Japan's Toyota Motor Corp. announced late Tuesday it would halt sales of some of its top-selling models to fix gas pedals that could stick and cause unintended acceleration. Last week, Toyota issued a recall for the same eight models affecting 2.3 million vehicles.
Toyota is also suspending production at six North American car-assembly plants beginning the week of Feb. 1. It gave no date on when production could restart.
The timing could not be worse for Toyota. Two years ago, the company beat out General Motors Co. to become the world's largest automaker. Now just weeks into 2010, it is stopping some sales in its biggest market, the U.S., at a time when it desperately needs to sell cars here after reporting its first-ever annual loss last year.
The sales and production halt involves several best-selling U.S. models, including the Camry and Corolla sedans and the RAV 4 crossover, a blend of an SUV and a car. RAV 4's sales surged last month.
In addition, the problem could spread to Europe, where a similar accelerator part is being used, said Toyota spokeswoman Ririko Takeuchi. She declined to give the number of vehicles affected. The company was studying possible responses there, including a recall, she said.
"For Europe, the number and models potentially concerned are under evaluation," said Philippe Boursereau, spokesman for Toyota France.
The supplier is CTS Corp., based in Elkhart, Ind., and the problem part was manufactured at its plant in Ontario, Canada, according to a report Toyota handed to the U.S. National Highway Traffic Safety Administration last week.
CTS has not replied to a request for comment sent earlier this week.
Toyota's report says it first received reports in March 2007, of gas pedals being slow to come back in the Tundra pickup, and fixed the problem in February 2008.
Starting in December 2008, similar problems were reported in Europe with the Aygo and Yaris models. Toyota said it lengthened a part and changed the material to fix the problem, starting in August 2009.
The latest problem emerged in North America, culminating in the decision for the recall earlier this month, Toyota said in the report.
John Wolkonowicz , a longtime auto analyst with IHS-Global Insight, said Toyota is fortunate in that it has a loyal customer base — primarily baby booners who have been buying Toyotas for decades. That, he said, will help minimize the sales impact in the short term.
"But it will further impede their ability to get the younger buyers that they so dearly want to get into the Toyota fold," Wolconowicz said.
Toyota has said it was unaware of any accidents or injuries due to the pedal problems associated with the recall, but could not rule them out for sure.
The sales halt calls into question the aggressive growth strategy pursued under former President Katsuaki Watanabe, a cost-cutting expert, who led the Japanese automaker to the No. 1 spot in global vehicle sales in 2008, analysts say.
Hitting that milestone coincided with a 437 billion yen ($4.86 billion) loss during its last fiscal year, marking the worst performance in the company's 72-year history.
The automaker said the U.S. sales suspension includes the following models: the 2009-2010 RAV4, the 2009-2010 Corolla, the 2007-2010 Camry, the 2009-2010 Matrix hatchback, the 2005-2010 Avalon large sedan, the 2010 Highlander crossover, the 2007-2010 Tundra pickup and the 2008-2010 Sequoia large SUV.
"This action is necessary until a remedy is finalized," said Bob Carter, Toyota's group vice president and general manager.
Toyota spokesman Mike Goss said most workers were expected to be at their jobs during the assembly line shutdown. Workers will receive additional training or work on improvements to their assembly processes. They can also take vacation or unpaid leave, he said.
About 300 workers who build V8 engines at a Toyota plant in Huntsville, Ala., will be affected, said Stephanie Deemer, a spokeswoman for the plant. Goss said the shutdowns will also affect engine plants in Georgetown, Ky., and Buffalo, W.Va.
Toyota dealers said they were concerned the move would hamper sales. They hoped parts to fix the problem could be distributed quickly.
John McEleney, who owns a Clinton, Iowa, Toyota dealership, said the sales stoppage affects about 60 percent of the inventory on his lot. He said he was hopeful Toyota would come up with a fix soon — especially because the longer a vehicle stays on a dealer lot, the more money a dealer pays in interest fees.
"Short term, it's goign to be difficult," he said. "It will certainly set us back, but I think the impact will be very short lived."
Mamoru Katou, analyst at Tokai Tokyo Research, said Toyota was likely reorganizing production plans, such as switching suppliers, and shipping in parts from Japan.
"The problem is extremely serious," said Katou. "The models are precisely those Toyota had been preparing to sell in big numbers."
Toyota expects to sell 2.19 million vehicles in North America in 2010, up 11 percent from 2009, according to sales targets released Tuesday. Globally, Toyota said it was planning sales of 8.27 million vehicles this year, up 6 percent from 2009.
But those numbers have not figured in the U.S. sales stoppage, Takeuchi said.
The automaker's problems in the U.S. may be an extension of the spate of quality problems that plagued Toyota several years ago in Japan, its home market, during the aggressive growth strategy pursued under Watanabe.
In 2006, the Japanese government launched a criminal investigation into accidents suspected of being linked to vehicle problems, though nobody was charged. Watanabe later acknowledged overzealous growth was behind the quality problems.
Watanabe was replaced last year by Akio Toyoda, the grandson of Toyota's founder.
Tuesday's announcement follows a larger U.S. recall months earlier of 4.2 million vehicles because of problems with gas pedals becoming trapped under floor mats, causing sudden acceleration. That problem was the cause of several crashes, including some fatalities.
About 1.7 million vehicles fall under both recalls.
The auto company said the sales suspension wouldn't affect Lexus or Scion vehicles. Toyota said the Prius, Tacoma, Sienna, Venza, Solara, Yaris, 4Runner, FJ Cruiser, Land Cruiser and select Camry models, including all Camry hybrids, would remain for sale. Those vehicles contain gas pedals produced by a different North American supplier from the one whose parts are invovled in the current sales halt, Toyota has said.
Toyota sold more than 34,000 Camrys in December, making the midsize sedan America's best-selling car. It commands 3.4 percent of the U.S. market and sales rose 38 percent from a year earlier. Sales of the Corolla and Matrix, a small sedan and a hatchback, totaled 34,220 last month, with 3.3 percent of the market and sales up nearly 55 percent from December of 2008.
The suspect parts are made by a U.S. supplier, but they are also found in its European-made vehicles, an official with the automaker said Wednesday. Toyota said it hasn't decided what to do there.
Japan's Toyota Motor Corp. announced late Tuesday it would halt sales of some of its top-selling models to fix gas pedals that could stick and cause unintended acceleration. Last week, Toyota issued a recall for the same eight models affecting 2.3 million vehicles.
Toyota is also suspending production at six North American car-assembly plants beginning the week of Feb. 1. It gave no date on when production could restart.
The timing could not be worse for Toyota. Two years ago, the company beat out General Motors Co. to become the world's largest automaker. Now just weeks into 2010, it is stopping some sales in its biggest market, the U.S., at a time when it desperately needs to sell cars here after reporting its first-ever annual loss last year.
The sales and production halt involves several best-selling U.S. models, including the Camry and Corolla sedans and the RAV 4 crossover, a blend of an SUV and a car. RAV 4's sales surged last month.
In addition, the problem could spread to Europe, where a similar accelerator part is being used, said Toyota spokeswoman Ririko Takeuchi. She declined to give the number of vehicles affected. The company was studying possible responses there, including a recall, she said.
"For Europe, the number and models potentially concerned are under evaluation," said Philippe Boursereau, spokesman for Toyota France.
The supplier is CTS Corp., based in Elkhart, Ind., and the problem part was manufactured at its plant in Ontario, Canada, according to a report Toyota handed to the U.S. National Highway Traffic Safety Administration last week.
CTS has not replied to a request for comment sent earlier this week.
Toyota's report says it first received reports in March 2007, of gas pedals being slow to come back in the Tundra pickup, and fixed the problem in February 2008.
Starting in December 2008, similar problems were reported in Europe with the Aygo and Yaris models. Toyota said it lengthened a part and changed the material to fix the problem, starting in August 2009.
The latest problem emerged in North America, culminating in the decision for the recall earlier this month, Toyota said in the report.
John Wolkonowicz , a longtime auto analyst with IHS-Global Insight, said Toyota is fortunate in that it has a loyal customer base — primarily baby booners who have been buying Toyotas for decades. That, he said, will help minimize the sales impact in the short term.
"But it will further impede their ability to get the younger buyers that they so dearly want to get into the Toyota fold," Wolconowicz said.
Toyota has said it was unaware of any accidents or injuries due to the pedal problems associated with the recall, but could not rule them out for sure.
The sales halt calls into question the aggressive growth strategy pursued under former President Katsuaki Watanabe, a cost-cutting expert, who led the Japanese automaker to the No. 1 spot in global vehicle sales in 2008, analysts say.
Hitting that milestone coincided with a 437 billion yen ($4.86 billion) loss during its last fiscal year, marking the worst performance in the company's 72-year history.
The automaker said the U.S. sales suspension includes the following models: the 2009-2010 RAV4, the 2009-2010 Corolla, the 2007-2010 Camry, the 2009-2010 Matrix hatchback, the 2005-2010 Avalon large sedan, the 2010 Highlander crossover, the 2007-2010 Tundra pickup and the 2008-2010 Sequoia large SUV.
"This action is necessary until a remedy is finalized," said Bob Carter, Toyota's group vice president and general manager.
Toyota spokesman Mike Goss said most workers were expected to be at their jobs during the assembly line shutdown. Workers will receive additional training or work on improvements to their assembly processes. They can also take vacation or unpaid leave, he said.
About 300 workers who build V8 engines at a Toyota plant in Huntsville, Ala., will be affected, said Stephanie Deemer, a spokeswoman for the plant. Goss said the shutdowns will also affect engine plants in Georgetown, Ky., and Buffalo, W.Va.
Toyota dealers said they were concerned the move would hamper sales. They hoped parts to fix the problem could be distributed quickly.
John McEleney, who owns a Clinton, Iowa, Toyota dealership, said the sales stoppage affects about 60 percent of the inventory on his lot. He said he was hopeful Toyota would come up with a fix soon — especially because the longer a vehicle stays on a dealer lot, the more money a dealer pays in interest fees.
"Short term, it's goign to be difficult," he said. "It will certainly set us back, but I think the impact will be very short lived."
Mamoru Katou, analyst at Tokai Tokyo Research, said Toyota was likely reorganizing production plans, such as switching suppliers, and shipping in parts from Japan.
"The problem is extremely serious," said Katou. "The models are precisely those Toyota had been preparing to sell in big numbers."
Toyota expects to sell 2.19 million vehicles in North America in 2010, up 11 percent from 2009, according to sales targets released Tuesday. Globally, Toyota said it was planning sales of 8.27 million vehicles this year, up 6 percent from 2009.
But those numbers have not figured in the U.S. sales stoppage, Takeuchi said.
The automaker's problems in the U.S. may be an extension of the spate of quality problems that plagued Toyota several years ago in Japan, its home market, during the aggressive growth strategy pursued under Watanabe.
In 2006, the Japanese government launched a criminal investigation into accidents suspected of being linked to vehicle problems, though nobody was charged. Watanabe later acknowledged overzealous growth was behind the quality problems.
Watanabe was replaced last year by Akio Toyoda, the grandson of Toyota's founder.
Tuesday's announcement follows a larger U.S. recall months earlier of 4.2 million vehicles because of problems with gas pedals becoming trapped under floor mats, causing sudden acceleration. That problem was the cause of several crashes, including some fatalities.
About 1.7 million vehicles fall under both recalls.
The auto company said the sales suspension wouldn't affect Lexus or Scion vehicles. Toyota said the Prius, Tacoma, Sienna, Venza, Solara, Yaris, 4Runner, FJ Cruiser, Land Cruiser and select Camry models, including all Camry hybrids, would remain for sale. Those vehicles contain gas pedals produced by a different North American supplier from the one whose parts are invovled in the current sales halt, Toyota has said.
Toyota sold more than 34,000 Camrys in December, making the midsize sedan America's best-selling car. It commands 3.4 percent of the U.S. market and sales rose 38 percent from a year earlier. Sales of the Corolla and Matrix, a small sedan and a hatchback, totaled 34,220 last month, with 3.3 percent of the market and sales up nearly 55 percent from December of 2008.
It's nice to see you do something about Toyota. I work at Sterling Hts. Plant II Ford and proud UAW 228.
ReplyDeleteChris, this is indeed a serious problem. I think you should remember too that Toyota employs almost 40,000 Americans in their plants in the United States of America, workers that pay taxes to the United States goverment and tax dollars that help support valuable program here in America.
ReplyDeleteI've personally owned several Toyotas and American made vehicles and every Toyota I've owned has been trouble free.
How many are from Michigan? I retired from GM and it is statements like that hurt the UAW. Don't tell me you are a Jap rice burner lover. How many Americans work for GM,Ford and Chrysler? by the way most of the money Toyota gets goes back to Japan not America. When you buy a jap car you are putting UAW workers out on the street. I think these posters are right about you Bruce.
ReplyDeleteWhoa J. Higgins, calling people "japs"? I assume you are comfortable with calling blacks "negros"? After all, the more you say it the more comfortable you are with it. Are you still having flash-backs from Charlie in the rice-paddys?! BWAAAAHAHAHAHAHA
ReplyDeleteBWAAAAHAHAHAHA ... I about spit out my gum laughing at FAILk's knee-jerk (or is it just JERK) reaction to Chris posting this story about the Toyotas.
ReplyDeleteRELAX FAILk. Sounds to me like there are quite a few unsafe Toyotas out there. Looks like you were lucky enough to stumble onto one of the few models that don't have problems. Is that their way of selling more useless hybrids?!? ROFLMAO ... buy a hybrid or DIE. That's a catchy slogan, they can have it for their ad department.
God forbid you don't get more tax dollars to squander, eh FAILk? Boy, tamper with FAILk's influx of tax revenue and he about fills his panties with the poopy-poo!
Chris, why are these LIEberal Hypocrats such nut-jobs? Take for instance Ellie Light, who it is now coming to ... excuse the pun ... light is just some dude who writes in his little DailyKos diary and wants to get teabagged by Obummer in the worst way. Check out this article about another astro-turfer Hypocrat, and make sure you check out his picture. Is this guy the prototypical redneck Hypocrat LIEberal or what?!?! BWAAAAHAHAHAHA ... looks just like several of the people at FAILk's violent mob rallies!
ReplyDeleteRevealed! Meet the real 'Ellie Light'
Letter writer is male health-care worker tied to Daily Kos, Obama-Ayers machine
http://www.wnd.com/index.php?fa=PAGE.view&pageId=123327
Are people that buy foreign cars un-American in your view?
ReplyDeleteThe Marxist Roots of Obama’s Economic ‘Pivot’
ReplyDeleteby Joel B. Pollak
President Obama’s advisers assure us that he will use his State of the Union address tonight to deal with our nation’s ailing economy. Americans have already begun to hear talk of a “hard pivot” at the White House, away from health care and towards jobs.
Yet in economic terms, the president’s shift thus far has been more of the same: more government control and less individual freedom.
His attacks on banks—including a new tax that will invariably be passed on to consumers—caused stocks to plummet last week. He has targeted some banks for being “too big,” but without ending the costly policy of “too big to fail,” which removes the discipline of risk and reward. He crowed, “We want our money back,” but wants to use “our” money for his own spending programs, not for tax relief.
The central idea of the President’s new plan appears to be shaping up as a jobs program, in imitation of FDR’s public employment programs during the Great Depression, and funded by new taxes on Wall Street.
The plan is not about job creation—more jobs could be created by the private sector—nor is it about recouping the bailout. It is primarily about redistribution—and is based on old, bad ideas.
Read more about this and why this policy smacks of anti-semitism at the following link:
http://biggovernment.com/2010/01/27/the-marxist-roots-of-obamas-economic-pivot/
Who the hell are you talking to FAILk?
ReplyDeleteAnd why would anybody answer your questions, since you never answer any.
This comment has been removed by the author.
ReplyDeleteJophn you are one of the funniest guys around. I can't stop laughing.
ReplyDeleteBruce you may want to check out why Toyota first tryed to say it was floor mats and then fest up. Look at the engine sludge problem Toyota/Lexus have had for a very long time and they have been covering it up.
ReplyDeleteHere's a true American patriot RE-introducing comprehensive health care reform legislation. Yes, that's right, I said RE-INTRODUCING because this was originally introduced in 2008. Unfortunately the party of NO was already in power, and shut it down. Those Hypocrats, they don't want to help anyone out they only want control and power. Meanwhile, as the Republicans are introducing cost-saving measures, Obummer will be introducing where his next waste of $8 billion taxpayer dollars will be going to in the form of a monorail boondoggle.
ReplyDeletehttp://dailycaller.com/2010/01/27/rep-paul-ryan-to-introduce-alternative-to-health-care-and-spending/
Rep. Paul Ryan to introduce alternative to health care and spending
By Alex Pappas — The Daily Caller 01/27/10
Rep. Paul Ryan is re-introducing legislation in Congress today — amid criticism that his is ‘a party of no’ — to offer Republican alternatives to health care and spending the same day President Barack Obama will deliver his State of the Union address to Congress.
Ryan, the House Budget Committee Ranking Republican and chief sponsor of the bill, said the legislation will “restore our long-held legacy of leaving the next generation of Americans better off.”
The legislation, “A Roadmap for America’s Future,” was initially introduced in 2008, yet the version introduced today “will reflect the dramatic decline in our nation’s economic and fiscal condition” since then, according to a release from Ryan’s office.
“Simply saying ‘no’ to the further government expansions – simply maintaining today’s ‘status quo’ – is no longer an option: our health care sector must be reformed; our economy needs sustained job creation and real growth; and we must tackle the greatest threat to our economic and fiscal future – the crushing debt burden driven by the unsustainable growth in entitlement spending,” Ryan said in a statement.
Highlights of the plan, according to the release:
Health Care
• Provides a refundable tax credit — $2,300 for individuals and $5,700 for families — to purchase coverage in any state, and keep it with them if they move or change jobs.
• Allows Medicaid recipients to take part in the same variety of options by using the tax credit to purchase high-quality care.
Medicare
• Establishes and fully funds Medical Savings Accounts for low-income beneficiaries to cover out-of-pocket costs, while continuing to allow all beneficiaries, regardless of income, to set up tax-free MSAs.
Social Security
• Offers workers under 55 the option of investing over one third of their current Social Security taxes into personal retirement accounts, similar to the Thrift Savings Plan available to federal employees.
Tax Reform
• Provides taxpayers a choice of how to pay their income taxes – through existing law, or through a highly simplified income tax system that fits on a postcard with just two rates and virtually no special tax deductions, credits or exclusions (except the health care tax credit).
• Promotes saving by eliminating taxes on interest, capital gains and dividends and eliminates the death tax.
Job Training
• Performance measures will be developed to make sure the 49 job training programs, scattered across eight federal agencies, will prepare the nation’s workforce for a global economy. States will also have more flexibility in determining how to allocate program funds.
I'm tellin' ya Chris, these Hypocrat idiots supply the material. It's difficult to NOT laugh when you talk about the LIEberals! LOL
ReplyDeleteAnd word for word, Al is far and away the funniest. I'm still laughing about these regressives saying Obummer needs to be even more to the left and Al said something like "that's like Custer asking for more indians". I had to read that one to the wife, I was laughing so hard.
http://mjperry.blogspot.com/2010/01/what-you-wont-hear-tonight-obamas.html
ReplyDeleteWhat You Won't Hear Tonight: About How Obama's Interventionism is Eroding U.S. Prosperity
"His grandiose legislative ambition has become the partially free economy's biggest debt problem."
Neil Reynolds writing in today's Toronto Globe and Mail:
"When President Barack Obama delivers his State of the Union address tonight, he should - but won't - report the significant U.S. decline in economic freedom during his first year in the Oval Office.
Jointly published last week by the conservative Washington-based Heritage Foundation and The Wall Street Journal, the 2010 Index of Economic Freedom (a 480-page work) strips the United States of its traditional designation as a "free economy," listing it instead - and ranking it as No. 8 in the world - as "partially free." More embarrassing for Mr. Obama, it elevates Canada to the No. 7 spot that the United States surrendered, making Prime Minister Stephen Harper the leader of the economically freest country in the Western Hemisphere (see top ten below, click to enlarge)."
John that guys picture is great. He does look like those libtards at Bruces last protest. Isn't it funny that Bruce didn't even know about the Oak Park antiObama rally for progressives? I can't wait for that photo album to come out.
ReplyDeleteGreat post Chris. I found it on Google. Thanks for sticking up for the American workers. Bruce you are not worth it. Can't you people support our country and state? Michigan is in a Depression and Bruce gets a Toyota. You are a traitor to the American workers in Motown. I hope someone beats the tar out of your car one night.
ReplyDeleteNever Mind
ReplyDeleteby Gregory of Yardale
January 27, 2010
I heard a blathering idiot liberal caller on the radio today whose argument in favor of ObamaCare consisted of whining, "After the sick people are gone, who are they going to come after next?" repeatedly to the incredulous host.
In that spirit, Hot Air notices a marked change in Dingy Harry's tone over the last month.
Dec. 21, 2009:
"All over America, people are dying too soon. More and more, Americans who come down with the flu, or develop diabetes, or suffer a stroke are dying far earlier than modern science says they should die. More and more, Americans who contract skin cancer or have a heart condition are dying rather than being cured. ... But what is really killing more and more Americans every day are complications of our health care system."
That was when Dingy Harry was pushing the Senate to rush rush rush and pass a bill they had never even read.
January 26, 2010:
"We're not on health care now," Mr. Reid said. "We've talked a lot about it in the past."
He added, "There is no rush."
So, does he not care any more that thousands of Americans are dying because of our horrible health care system? Or was that just a big fat lie in the first place?
LIARS! LYING LIARS AND THE LIARS THAT TELL THE LIES, THE HYPOCRATS!
You wait and see how good Obama union address is. He will knock it out of the park and the progressive movement will gain strength.
ReplyDelete2.3 million vehicles and counting. That will cost Toyota a ton of cash. I wonder how much of our tax dollars went to Toyota for the purchase of an unsafe Toyota under Cash for Clunkers?
ReplyDeleteIt's a shame what happened to Toyota. Thank goodness it wasn't Ford. My co workers love this blog at the plant. It's like a fight club for politics and social issues. Got to go. Thanks again. John, you rock buddy.
ReplyDeleteRecall up to 5 million. Problem not limited to gas pedals, and sudden acceleration problem has existed since 2004, including models with different gas pedal mechanisms. 20 dead, 2000 accidents so far. Toyota is in deep shit. So much for superior quality.
ReplyDeleteBush's Fault!
ReplyDeleteHonda is in trouble now too. There is a God and he loves American made cars.lol
ReplyDelete