DOT Seeking Maximum Civil Penalty of Nearly $16.4M from Toyota; Largest Civil Penalty Ever Assessed Against an Automaker by NHTSA
05 April 2010
US Transportation Secretary Ray LaHood announced that the National Highway Traffic Safety Administration (NHTSA) is seeking the maximum civil penalty of $16.375 million against Toyota Motor Corporation for failing to notify the auto safety agency of the dangerous “sticky pedal” defect for at least four months, despite knowing of the potential risk to consumers.
Approximately 2.3 million vehicles in the US were recalled in late January for the sticky pedal defect. The penalty being sought against Toyota would be the largest civil penalty ever assessed against an auto manufacturer by NHTSA.
Auto manufacturers are legally obligated to notify NHTSA within five business days if they determine that a safety defect exists. NHTSA learned through documents obtained from Toyota that the company knew of the sticky pedal defect since at least September 29, 2009. That day, Toyota issued repair procedures to their distributors in 31 European countries and Canada to address complaints of sticky accelerator pedals, sudden increases in engine RPM, and sudden vehicle acceleration. The documents also show that Toyota was aware that consumers in the United States were experiencing the same problems.
We now have proof that Toyota failed to live up to its legal obligations. Worse yet, they knowingly hid a dangerous defect for months from US officials and did not take action to protect millions of drivers and their families. For those reasons, we are seeking the maximum penalty possible under current laws.
—Secretary LaHood
Under NHTSA’s current authority, the maximum possible civil penalty for related violations is $16.375 million. The penalty announced today relates specifically to the “sticky pedal” defect and NHTSA is still investigating Toyota to determine if there are additional violations that warrant further penalties.
On February 16, NHTSA launched an investigation into the timeliness and scope of the three recent Toyota recalls and required the automaker to turn over documents and explanations related to its adherence to US auto safety laws. NHTSA made a preliminary determination on the fine announced today based on a review of documents Toyota has provided. To date, Toyota has submitted more than 70,000 pages of documents, which NHTSA officials are continuing to review.
NHTSA says that it has the most active defect investigation program in the world, opening or closing an investigation almost every week. Over the last three years, NHTSA’s defect and compliance investigations have resulted in 524 recalls involving 23.5 million vehicles.
This could go a long way to further reduce USA's worldwide popularity and perceived sense of fair play.
GM, after 800+ recalls (the highest rate in the industry) gets $30+B in handouts.
Toyota, with one of the lowest recall rate, gets $19B penality.
Fair play will get a fatal blow?
An International Court is truly required to set things right.
Posted by: HarveyD | 05 April 2010 at 05:27 PM
1. This is a penalty for "failing to notify the auto safety agency of the dangerous “sticky pedal” defect for at least four months".
2. It is probably more like 4 years - but probably cannot be proven.
3. Toyota's recall rate is not as low now, as it was before before they admitted the defect.
Posted by: ToppaTom | 05 April 2010 at 08:02 PM
I remember that something called 'Unsafe to drive at any speed' was allowed to be sold and used during almost 10 years without penalties. Fatalities and injuries were not even counted because....
Posted by: HarveyD | 06 April 2010 at 03:35 PM
Because it did not have a hidden flaw that was hidden by the auto company.
It had a swing axel like the revered VW bug (and the Porsche) .
The high rear roll center (of swing axels) makes for very flat cornering and over steer and subsequent high speeds by drivers who judge their speed by how much the car leans and how reluctant it is to turn.
Posted by: ToppaTom | 06 April 2010 at 07:15 PM