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Fallout Continues in Toyota Acceleration Pedal Recall

Posted: Jan 28, 2010 10:15 a.m.

As expected, Toyota is enduring a lot of fallout for its recent recall of 2.3 million vehicles due to unintended acceleration problems – which led to the subsequent freezing of sales and production for eight of its most popular models.

While some people applauded Toyota for making the right decision, the National Highway Traffic Safety Administration (NHTSA) has now revealed that Toyota didn’t make that decision on its own – the safety agency legally required Toyota to stop selling the vehicles. What’s more worrisome is that Toyota continued selling the vehicles in question for a full five days after the recall was issued.

“Although Toyota is now following the letter of the law, the company was slow to react on its latest recall of 2.3 million vehicles,” explains Left Lane News. “Per the rules and regulations of the NHTSA, Toyota should have immediately stopped sales of vehicles involved in the recall, but continued to sell potentially faulty vehicles for another 5 days.”

According to Autoblog, “Toyota spokesman Mike Michels is reported saying that the company's decision to stop selling the recalled vehicles was voluntary, but that they also had a legal requirement to do so. How do you voluntary do something that you're obligated to do?”

In addition to the sales halt, production for the eight models affected by the accelerator pedal recall will cease the week of Feb. 1. But that’s not the only consequence of the recall. Two of the largest rental car companies are now pulling Toyota cars from their fleets as a precautionary measure.

Autoblog writes, “Avis Budget estimates it will pull 20,000 units, while Enterprise Holdings, which manages its Enterprise, National and Alamo brands, didn't give a number, except to say that about four percent of its fleet would be affected.”

But the sales and production halt may not last long. According to several sources, Toyota already has a solution in the works and has designed a replacement part for the accelerator pedals in the recalled vehicles.

“The Japanese automaker has said the problem with accelerator pedals that could stick open as they aged was limited to a pedal mechanism supplied by CTS Corp., built in the supplier’s Canadian factory,” reports the Detroit Free Press. “CTS said today the problem identified by Toyota had been reported ‘fewer than a dozen’ times, and ‘in no instance did the accelerator actually become stuck in a partially depressed condition.’”

Edmunds Inside Line adds, “One dealer source told Edmunds.com that [the pedal sticking] generally occurs when the vehicle has reached 38,000 miles on the odometer.”

The new part means production can probably resume quickly, but current Toyota owners may not be as lucky.

Autoblog explains: “There are 2.3 million vehicles in customers' driveways that require the replacement part, but [Automotive News] sources say the plant that makes them has an annual capacity of just 2 million. Considering that Toyota's assembly plants also need to be supplied, we're wondering how Toyota will be able to fix each recalled vehicle in a timely manner.”

According to the Detroit News, Toyota will do what it can for owners and “is working with dealers to provide customers with alternative transportation if they're concerned about driving recalled vehicles.”

Still, though Toyota seems to be taking every measure it can, this problem has created a firestorm that may not burn out for a while.

“Toyota was once the pillar of reliability and quality, but now appears to be struggling under the strain of becoming the world’s largest automaker,” concludes Left Lane News. “Toyota was optimistic it could increase sales by 6 percent this year, but that goal will be difficult given U.S. Toyota dealers have virtually no products to sell."

Toyota’s stock has already taken a hit due to the sales freeze. According to the Detroit Free Press, “Toyota’s stock fell 8% or $7.01 to close at $79.77 a share. Ford stock rose 3.2% or 36 cents to close at $11.55 per share.” They add, “Other brands are likely to pick up the short-term slack -- including brands introducing a new competitive product, such as Ford and Hyundai.”

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