Toyota faces $200m bill as it recalls 530,000 faulty US vehicles
By Stephen Foley in New York
Published: 20 January 2007
Toyota has been forced to recall more than half a million of its pick-up trucks and sports utility vehicles in the US after steering problems caused a rash of accidents.
The problems with its Tundra pick-up and the Sequoia SUV are a blow to the company as it aims to win a larger share of the American market for these gas-guzzling vehicles.
Some analysts put the cost of the recall of the 533,000 vehicles at more than $200million (£101m), when parts and labour have been factored in. Toyota has promised to replace steering joints, which have been found to wear away too quickly or to become loose, making it difficult to handle the vehicle.
The company said it thought the problem had caused 11 accidents, injuring six people.
The latest recall comes less than two years after Toyota recalled about 800,000 pick-up and sport utility vehicles, including Tundra and Sequoias from model years 2002 to 2004, over a front suspension-related problem. The vehicles involved in yesterday's recall were made at the company's factory in Indiana between 2004 and the end of last year.
Toyota's Camry is the biggest selling car in the US, and the company is increasingly challenging the big domestic carmakers for dominance of American highways. It is expected to surpass Ford's sales in the US this year, and the launch of a new range of super-size Tundras at the Detroit Motor Show this month signalled how the Japanese company is threatening one of the last bastions of the American carmakers' power.
The recall of the faulty Tundras comes at a sensitive time, therefore, and threatens to chip away at the popular perception that the Japanese make the best cars. Christopher Richter, a motor industry analyst at CLSA Asia-Pacific Markets, said: "Toyota has a lot of goodwill built up."
In another setback for a Japanese carmaker in the US, Honda said yesterday that it is recalling 81,000 Accord sedans because of faulty wiring in the sensor on the driver's airbag. The airbag can inflate in the wrong way, increasing the risk of injury for smaller drivers in a frontal crash, regulators found. The Accord is Honda's top selling model in the US, with more than 350,000 sold last year.
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2007/01/22 01:36am 
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