Toyota Pays Record Fine for Delay in Reporting Sudden Acceleration and Steering Defects

December 21, 2010

Toyota Motor Corporation has agreed to pay $32 million dollars in penalties, in addition to $16 million the company paid already earlier this year, for failing to report sudden acceleration and steering rod defects to the U.S government in a timely manner.

"Safety is our top priority and we take our responsibility to protect consumers seriously," said U.S. Transportation Secretary Ray LaHood said in a statement. "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 fines are the result of two separate investigations into recent Toyota recalls. The first into sudden acceleration incidences first thought caused by entrapment of the floor mat, but later proved to be a defect in the design of the gas pedal. Toyota eventually recalled nearly five million Toyota vehicles between September 2007 and January 2010.

The second investigation involved a steering relay rod prone to breaking, resulting in a recall of nearly one million vehicles since 2005.

The investigations found that Toyota violated the National Traffic and Motor Vehicle Safety Act by failing to report safety defects to the National Highway Traffic Safety Administration (NHTSA) in the time specified. Under the federal law, car manufacturers must notify the NHTSA of any defect within five days and promptly conduct a recall.

"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."

Money from the penalties goes into the Treasury Department’s General Fund.

“Toyota is pleased to have resolved these legacy issues related to the timeliness of prior recalls dating back to 2005,” said Steve St. Angelo, Toyota’s Chief Quality Officer for North America. “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.”

Although Toyota agreed to pay the penalties, they refused to admit to any violation of the National Traffic and Motor Vehicle Safety Act.