Toyota's Steering Rod Recall: A Preventable Tragedy

Toyota Pays Record Penalty for Failing to Notify Regulators of Potential Safety Defects

Tuesday, December 21, 2010—Toyota Motor Corp. has agreed to pay the government a record $32.4 million in additional fines to settle an investigation into its handling of two recalls.

The Department of Transportation accused Toyota of failing to tell officials about a potentially dangerous steering defect that could cause a complete loss of steering control without warning and a tendency of floor mats on certain cars to entrap accelerator pedals, which could cause sudden, rapid acceleration.   The civil penalties will settle investigations into how Toyota dealt with the two recalls.

Toyota has now paid a total of $48.8 million in penalties this year alone for failing to inform officials of potentially lethal safety defects in its cars and trucks.

NHTSA's investigation of the steering recall began on May 10, 2010, when the law firm of O’Reilly Collins requested the agency open a timeliness query into Toyota Recall 05V389. The 2005 recall to replace defective steering relay rods in the United States came almost a full year after the Japanese manufacturer issued a Japan-only recall for the same trucks. Nearly 1 million trucks in the United States were affected by the recall.

Federal law requires a manufacturer to notify NHTSA within five days of determining a motor vehicle defect or noncompliance.

Toyota’s internal records show that the automaker was aware of many relay rod failures that occurred in the U.S. well before it issued the 2005 recall. However, Toyota told NHTSA they were not issuing a recall in the United States because they had no field information as of 2004.

Toyota's board of directors agreed to pay the fines on Tuesday at the company's board meeting in Japan. 

The company has already faced a criminal investigation in Japan over its handling of faulty steering relay rods. Though no Toyota officials were charged, the automaker received a rebuke from the Japanese government and was ordered to overhaul its recall system.

O’Reilly Collins will continue to pursue the depositions of Toyota Motor Corporation’s General Manager, Hiroyoki Yokoyama, who was behind the decision to delay the American recall, and Mitsatiru “Mitch” Kato, the executive who helped draft the 2004 false claims that Toyota was unaware of any problems with relay rods in America.