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TOYOTA LIMITED RECALL SAVED $100 MILLION
Posted by: Darrell Castle
February 22, 2010
Topic: Personal Injury
What is a single human life worth? How about 10 lives or a hundred? News media across the country are reporting on a story that comes from discovery requests by the House Committee on Oversight and Government Reform. I quote from the New York Times, "Toyota estimated that it saved $100 million by negotiating with regulators for a limited recall of 2007 Toyota Camry and Lexus ES models for sudden acceleration, the same problem that has since prompted it to recall millions of cars, documents turned over to a Congressional committee showed Sunday." The estimate came from a confidential presentation made in July 2009 listing legislative and regulatory "wins" for the company.
This limited recall, which was apparently blamed on defective floor mats instead of electronics, allowed Toyota to keep millions of defective cars on the road which it was later forced, by crashes and lawsuits, to recall. Since the initial recall, Toyota has recalled more than 8 million vehicles worldwide related to stuck accelerator pedals. It has temporarily stopped selling and building vehicles in the U.S. and Canada that were involved in the recalls and dealers have begun repairing defective models. The company announced that the 8 million recalls plus one recall involving brakes on its hybrid Prius could cost it 2 billion.
Congressional investigators are now asking whether regulators did their original job effectively or not. This is a very easy question to answer. Regulators allowed Toyota to limit its early recall to 55,000 floor mats and avoid investigation of the far more serious electronics issues. The company also was allowed to head off an investigation of its Tacoma Truck series. These regulatory failures allowed defective vehicles to continue killing and injuring people. The regulators, as well as Toyota, should be held accountable for the injuries.
Transportation Secretary Ray LaHood has been critical of the way the recalls were handled, and his spokes person, Olivia Alair, said in a statement, "We're going to hold Toyota's feet to the fire and make sure they do what's necessary." Well, we're watching what they do. Time will tell.
