Toyota may face 2nd fine over delay to big sticky pedal recall
By Soyoung Kim |
April 12, 2010, Monday
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Print Edition
Print Edition
UNITED States safety regulators may seek a second penalty against Toyota Motor Corp for knowingly delaying a massive recall over defective accelerator pedals, after imposing a record US$16.4 million fine against the auto maker last week.
The US National Highway Traffic Safety Administration, in an April 5 letter to Toyota, said the Japanese car maker's recall of 2.3 million vehicles in January for faulty accelerator pedals came at least four months after the auto maker had determined there were safety defects in the vehicles.
The agency may pursue a second fine based on documents submitted by Toyota, which indicated there were two separate defects in the recalled pedals, the letter showed. The agency said Toyota would have faced a fine totaling US$13.8 billion if not for caps set by US law.
The proposed US$16.4 million civil penalty against Toyota on April 5 is the maximum allowed by US law and the largest that the Department of Transportation has ever sought.
"Here, the gravity of Toyota's apparent violations is severe and potentially life-threatening," NHTSA Chief Counsel O. Kevin Vincent said in the letter, a copy of which was reviewed by Reuters.
US law allowed a US$6,000 penalty for each defective vehicle sold by Toyota, adding to US$13.8 billion. Due to a law that limits individual fines against a manufacturer, the maximum the government could seek was US$16.375 million, Vincent said in the letter.
Toyota has until April 19 to decide whether to appeal that penalty for the first official finding that the world's largest auto maker violated US safety regulations.
"If Toyota will not agree to pay the demanded penalty, NHTSA will refer this matter to the US Department of Justice with the recommendation that the Attorney General commence a civil action in federal court ...," Vincent said.
The New York Times first reported the NHTSA letter.
Car makers are legally obliged to tell US safety regulators within five days if they discern a safety defect exists.
US safety regulators said the auto maker's own records showed it had issued repair notices for the sticky pedal problem in Canada and Europe in September but did not take action in the US market until January.
The US National Highway Traffic Safety Administration, in an April 5 letter to Toyota, said the Japanese car maker's recall of 2.3 million vehicles in January for faulty accelerator pedals came at least four months after the auto maker had determined there were safety defects in the vehicles.
The agency may pursue a second fine based on documents submitted by Toyota, which indicated there were two separate defects in the recalled pedals, the letter showed. The agency said Toyota would have faced a fine totaling US$13.8 billion if not for caps set by US law.
The proposed US$16.4 million civil penalty against Toyota on April 5 is the maximum allowed by US law and the largest that the Department of Transportation has ever sought.
"Here, the gravity of Toyota's apparent violations is severe and potentially life-threatening," NHTSA Chief Counsel O. Kevin Vincent said in the letter, a copy of which was reviewed by Reuters.
US law allowed a US$6,000 penalty for each defective vehicle sold by Toyota, adding to US$13.8 billion. Due to a law that limits individual fines against a manufacturer, the maximum the government could seek was US$16.375 million, Vincent said in the letter.
Toyota has until April 19 to decide whether to appeal that penalty for the first official finding that the world's largest auto maker violated US safety regulations.
"If Toyota will not agree to pay the demanded penalty, NHTSA will refer this matter to the US Department of Justice with the recommendation that the Attorney General commence a civil action in federal court ...," Vincent said.
The New York Times first reported the NHTSA letter.
Car makers are legally obliged to tell US safety regulators within five days if they discern a safety defect exists.
US safety regulators said the auto maker's own records showed it had issued repair notices for the sticky pedal problem in Canada and Europe in September but did not take action in the US market until January.
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