- The Washington Times - Tuesday, April 6, 2010

Toyota Motor Corp. faces a maximum penalty of more than $16 million, a record civil penalty against an automaker, for failing to promptly notify the U.S. government about defective gas pedals among its vehicles, federal officials announced Monday.

Toyota has recalled more than 6 million vehicles in the U.S., and more than 8 million worldwide, because of reports of acceleration problems in multiple models and braking issues in the popular Prius hybrid model.

Transportation Secretary Ray LaHood said Monday that documents obtained from the Japanese automaker showed that Toyota knew of the problem with the sticking gas pedals in late September, but did not issue a recall until late January. The sticking gas pedal recall involved 2.3 million vehicles.

“We now have proof that Toyota failed to live up to its legal obligations,” Mr. LaHood said in a statement. “Worse yet, they knowingly hid a dangerous defect for months from U.S. officials and did not take action to protect millions of drivers and their families.”

For those reasons, Mr. LaHood said, the government is seeking a fine of $16.375 million, the maximum penalty possible under law. In 2004, General Motors paid a record $1 million fine for responding too slowly on a recall of nearly 600,000 vehicles over windshield-wiper failure.

The automaker has two weeks to accept or contest the penalty.

“While we have not yet received their letter, we understand that NHTSA has taken a position on this recall,” the company said in a statement, a reference to the National Highway Transportation Safety Administration. “We have already taken a number of important steps to improve our communications with regulators and customers on safety-related matters as part of our strengthened overall commitment to quality assurance.”

The company noted that it has appointed a new chief quality officer for North America and has given its North American office a greater role in making safety-related decisions.

Under federal law, automakers must notify NHTSA within five days of determining that a safety defect exists and promptly conduct a recall.

The Transportation Department said the penalty against Toyota is specifically tied to the sticking-pedal defect and Toyota could face additional penalties under the government’s investigation.

The government has linked 52 deaths to crashes suspected of being caused by accelerator problems in Toyotas. The recalls have led to congressional hearings, a criminal investigation by federal prosecutors, dozens of lawsuits and an intense review by the Transportation Department.

Toyota, which has seen its global reputation for quality and reliability battered by the revelations, has attributed the problem to sticking gas pedals and accelerators that can become jammed in floor mats, and officials have strongly denied that an electrical problem - a far more expensive fix - was at fault. Toyota dealers have serviced 1.7 million vehicles under recall so far.

Consumer groups have said electronics could be the culprit, and dozens of Toyota owners who had their cars fixed in the recall have complained of more problems with their vehicles surging forward unexpectedly.

After the recalls, the Transportation Department demanded in February that Toyota turn over documents detailing when and how it learned of the problems with sticking accelerators and with floor mats trapping gas pedals.

NHTSA said documents provided by Toyota showed the automaker had known about the sticky pedal defect since at least Sept. 29, 2009, when it issued repair procedures to distributors in 31 European countries and Canada to address complaints of sticking pedals, sudden increases in engine RPM and sudden vehicle acceleration.

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